Australia’s jobless rate rose in May but there was some positives in the figures, with employers adding the most full-time jobs since November 2010.
The unemployment rate last month inched higher to 5.1% from a revised 5.0% in April, according to the Australian Bureau of Statistics figures released today.
The economy added 46,100 full-time jobs in May, with the net gain of 38,900 when the loss of 7,200 part-time positions was deducted.
The Australian stock market jumped at the opening, as positive local sentiment returns following solid gains on US and European markets overnight and strong GDP figures yesterday.
At the market open, the benchmark S&P/ASX 200 index gained 1.1% to 4,100.3 points, while the broader All Ordinaries Index rose 1.11% to 4,105.4 points.
“Australian employment figures are due later today and if the figures beat forecasts we may see the market rally even further,” says Miguel Audencial, sales trader at CMC Markets.
“Even if the figures disappoint, I can still see the Australian market finish in the green thanks to optimism brought about by the strong sessions of the European and US markets.”
Construction industry contracts for 24 months now
The national construction industry recorded its 24th consecutive month of contraction in May, according to the latest Australian Industry Group Australian Performance of Construction Index releases in conjunction with the Housing Industry Association.
The index remained in the red in May, down 0.2 points to 34.7, with readings below 50 indicating a contraction in activity and the distance from 50 indicative of the strength of the decrease.
By sector, commercial construction registered the sharpest fall in more than three years coinciding with a further weakening in new orders.
House and apartment building activity continued to contract substantially.
Julie Toth, Australian Industry Group chief economist, says the index continues to reflect the cyclical downturn in residential housing activity as well as the downturn in non-residential building and construction, outside the mining sector.
“While the two consecutive cash rate cuts from the RBA in May and June are very welcome and will help to improve sentiment among home builders and investors, it will take some time for this benefit to flow through to actual construction activity levels.
“In the meantime, the forward indicators such as building and credit application approvals all point to a further period of extended weakness in construction activity levels from here,” Toth said.