The jobless rate declined to 3.9%, a level last recorded in August 1974, government data showed Thursday. Employment rose by 4,000 from a month earlier, as a surge in full-time roles was partly offset by a drop in part-time.
Tightness in the labour market is a key reason why the Reserve Bank of Australia expects wages growth to accelerate to 3% this year from 2.4% now, allowing it to extend a rate hiking cycle that began this month.“Together with business surveys, this data shows that wage growth should accelerate in coming months and supports the case for the RBA to undertake a series of rate hikes to push the cash rate off crisis settings,”said Jo Masters, chief economist at Barrenjoey Markets Pty.
He is backing bigger pay rises for workers, pointing out the economy recorded the biggest fall in real wages in more than two decades in the first three months of the year.