Australian unemployment drops to 9.5% in August – as lockdowns force contractions in key workforce estimates

The lockdowns of over 15 million Australians in Sydney, Melbourne and Canberra throughout August led to all the key employment measures including the workforce, employment and unemployment to contract during the past month.The latest Roy Morgan employment series data shows 1.36 million Australians were unemployed in August, down 60,000 on July, for an unemployment rate of 9.5%, while under-employment was down 0.9% points to 8.2% (1.18 million).

• Lockdowns force contraction in workforce, down over 200,000 to 14.4 million:
  
  The workforce in August was 14,403,000 (down 217,000) – comprised of 13,041,000 employed Australians (a drop of 157,000) and 1,362,000 unemployed Australians looking for work (down 60,000). This is the first time since the first half of 2020 the workforce has contracted for two months in a row.

• There were 13 million Australians employed in August:
  
  Australian employment was down by 157,000 to 13,041,000 in August including 8,654,000 workers employed full-time, a drop of 111,000 from July. There was also a decrease in part-time employment, down by 46,000 to 4,387,000. This is the first time that the workforce, full-time employment and part-time employment have all dropped for consecutive months in a row for fifteen years since August 2006.

• Unemployment dropped in August as fewer people looked for full-time work due to the lockdowns:
  
  1,362,000 Australians were unemployed (9.5% of the workforce), down 60,000 from July. Driving the fall was far fewer more people looking for full-time work (down 127,000 to 492,000) while there was an increase in people looking for part-time work (up 67,000 to 870,000).

Roy Morgan Unemployment & Under-employment (2019-2021)

Source: Roy Morgan Single Source January 2019 – August 2021. Average monthly interviews 5,000.

Note: Roy Morgan unemployment estimates are actual data while the ABS estimates are seasonally adjusted.

Roy Morgan’s unemployment figure of 9.5% for August is nearly 5% points higher than the current ABS estimate for July 2021 of 4.6%. However, the ABS figure for July counts as employed an additional 181,000 Australians who were working zero hours for ‘economic reasons’ and 207,000 Australians who were working zero hours for ‘other reasons’ – such as being forced out of work by mandatory lockdowns.

If these 388,400 non-workers are added back the ABS unemployment estimate for June increases to 1.03 million (7.4%). The ABS also claims there are nearly 1.15 million Australians (8.3%) under-employed for a total of over 2.17 million unemployed or under-employed (15.7% of the workforce).

• Under-employment was also down in August during a month of widespread lockdowns:

In addition to those who were unemployed, 1.18 million Australians (8.2% of the workforce) were under-employed – working part-time but looking for more work, a drop of 159,000 (down 0.9% points) from July.
In total 2.54 million Australians (17.7% of the workforce) were either unemployed or under-employed in August, a drop of 220,000 on July. The drop was driven by the contracting workforce during lockdowns as both unemployment and under-employment fell from a month ago.
Compared to February 2020, before the nation-wide lockdown was implemented, in August 2021 there were over 100,000 more Australians either unemployed or under-employed (+0.4% points) even though overall employment (13,041,000) is still higher than it was pre-COVID-19 (12,913,000).

Michele Levine, CEO Roy Morgan, says the lockdown of Australia’s two largest States throughout the month of August has led to drops across all key employment estimates including the workforce as a whole as well as employment and unemployment – all down on July:

“Although the latest Roy Morgan employment estimates for August show unemployment falling 0.2% points to 9.5%, the broader picture shows this is not due to increasing jobs but rather the impact of lockdowns directly impacting over half of the Australian population.

“In August all the key employment estimates were down on July with the workforce down for a second straight month and down by 365,000 since June when the long Sydney lockdown began. Australian employment also dropped in August, by 157,000, while unemployment was down by 60,000 as rather than getting new jobs people looking for work stopped looking and were forced to stay at home.

“Unfortunately, the lockdown of over 15 million Australians in NSW, Victoria and the ACT during August is set to continue throughout the current month of September. However, the ‘relatively’ positive news is that the vaccination program has significantly accelerated in recent weeks as locked down people in NSW and Victoria rush out to get vaccinated and the full vaccination targets of 70% and 80% of the population are set to be reached earlier than initially forecast.

“Already over 70% of people in NSW have had their first vaccine dose and over 40% are now fully vaccinated. Victoria is a bit behind but has seen an accelerating uptake in recent weeks as the state endures its sixth lockdown. At current rates of vaccination some restrictions are set to be eased later in September and there is the prospect that the lockdowns in both States could be lifted entirely by late October or perhaps early November.

“Given the unprecedented forces being exerted on the labour market the declines in key employment estimates in August provide a superficially positive comparison to the results from prior months. However, it is worth noting that overall unemployment and under-employment of 2.54 million (17.7% of the workforce) is the lowest monthly figure since February 2020 (2.44 million) prior to the pandemic.

“Despite the positive trends on vaccination the next two months are still set to be very hard for the retail, hospitality, recreational and personal businesses that rely on close personal contact. During this period it remains absolutely imperative that both Federal & State Governments offer businesses negatively impacted by the lockdowns a sufficient level of support to ensure business closures over this period are kept to a minimum.

“Although for many Australians currently stuck in lockdown the lifting of restrictions appears far away in reality we should finally emerge into a new ‘COVID-Normal’ in around two months’ time. The vision of people going about their daily lives from the highly vaccinated countries of the UK, USA and in Europe shows that there is an end in sight that we are approaching.”

This Roy Morgan survey on Australia’s unemployment and ‘under-employed’* is based on weekly interviews of 778,122 Australians aged 14 and over between January 2007 and August 2021 and includes 7,446 telephone and online interviews in August 2021. *The ‘under-employed’ are those people who are in part-time work or freelancers who are looking for more work.

Contact Roy Morgan to learn more about Australia’s unemployed and under-employed; who and where they are, and the challenges they face as they search for employment opportunities.

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Roy Morgan Unemployed and ‘Under-employed’* Estimates

Roy Morgan Research cf. ABS Unemployment Estimates

Source: Roy Morgan Single Source October 2006 – August 2021. Average monthly interviews 4,000.
Note: Roy Morgan unemployment estimates are actual data while the ABS estimates are seasonally adjusted.

Roy Morgan Research cf. ABS Unemployment Estimates

Source: Roy Morgan Single Source October 2006 – August 2021. Average monthly interviews 4,000.
Note: Roy Morgan unemployment estimates are actual data while the ABS estimates are seasonally adjusted.

Source: Roy Morgan Single Source October 2006 – August 2021. Average monthly interviews 4,000.
Note: Roy Morgan unemployment estimates are actual data while the ABS estimates are seasonally adjusted.

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