{"id":12699,"date":"2025-08-16T01:16:38","date_gmt":"2025-08-15T15:16:38","guid":{"rendered":"https:\/\/www.hiringlab.org\/au\/?p=12699"},"modified":"2025-08-21T03:18:56","modified_gmt":"2025-08-20T17:18:56","slug":"july-au-labour-force-survey-employment-growth-struggling-to-keep-pace","status":"publish","type":"post","link":"https:\/\/www.hiringlab.org\/au\/blog\/2025\/08\/16\/july-au-labour-force-survey-employment-growth-struggling-to-keep-pace\/","title":{"rendered":"July 2025 AU Labour Force Survey: Employment Growth Struggling to Keep Pace"},"content":{"rendered":"\n<p><strong>Key points:<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Australian employment rose in July, but growth in 2025 has so far been disappointing. Employment is no longer keeping pace with growth in Australia\u2019s working-age population.\u00a0\u00a0<\/li>\n\n\n\n<li>Australia\u2019s underemployment rate fell to its lowest level since August 2008.\u00a0<\/li>\n\n\n\n<li>Australian wages rose 3.4% over the past year, comfortably exceeding inflation.\u00a0<\/li>\n<\/ul>\n\n\n\n<p><a href=\"https:\/\/www.abs.gov.au\/statistics\/labour\/employment-and-unemployment\/labour-force-australia\/jul-2025\" target=\"_blank\" rel=\"noreferrer noopener\">Australian employment<\/a> rose by 24,500 people in July, consistent with <a href=\"https:\/\/www.investing.com\/economic-calendar\/employment-change-94\" target=\"_blank\" rel=\"noreferrer noopener\">market expectations<\/a>,\u00a0and the unemployment rate declined to 4.2%. But while Australian employment increased by 263,700 people over the past year, it has climbed by just 113,300 people through the first seven months of 2025. If that pace continues, Australian employment may grow by fewer than 200,000 people this year \u2014 insufficient to keep up with working-age population growth.<\/p>\n\n\n\n<p>Maintaining the pace of employment growth from 2023 and 2024 was always going to be difficult, but the drop-off has been swift, and the magnitude somewhat unexpected, given the ongoing strength in measures (including Indeed\u2019s <a href=\"https:\/\/data.indeed.com\/#\/postings\" target=\"_blank\" rel=\"noreferrer noopener\">Job Posting Index<\/a>). Job vacancies are jobs waiting to be filled, so a high number of job postings typically indicates strong future employment growth. That hasn\u2019t been the case in 2025 so far.\u00a0<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/lh7-rt.googleusercontent.com\/docsz\/AD_4nXfo87BCGY4eLGU4bu1W6drooNn0D2NgPA3B0ECbrcaobQ-EJCQ46qKh1wxzsmUa1FAWqoi9IBciRiNnGvvm-qsFyjPuJtV57n_XRIKQ8Ql1V9PEJUnC2iv2cwXTVl8HbpQBFfWOow?key=CtHn38eu_hvc4_0_QbmpUQ\" alt=\"Line graph titled \u201cAustralian employment growth.\u201d With a vertical axis ranging from -100,000 to 500,000, employment growth this year has been much weaker than in both 2023 and 2024.\u00a0\" \/><figcaption class=\"wp-element-caption\"><em>Line graph titled \u201cAustralian employment growth.\u201d With a vertical axis ranging from -100,000 to 500,000, employment growth this year has been much weaker than in 2023 and 2024.\u00a0<\/em><\/figcaption><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Upside risks for the unemployment rate<\/strong><\/h2>\n\n\n\n<p>Employment growth that no longer keeps pace with growth in Australia\u2019s working-age population is concerning because, if it continues, the unemployment rate will rise considerably. We\u2019ve already seen that recently, with the unemployment rate rising by around 0.3 percentage points since the beginning of the year.<\/p>\n\n\n\n<p>The Reserve Bank of Australia <a href=\"https:\/\/www.rba.gov.au\/publications\/smp\/2025\/aug\/outlook.html#3-5-detailed-forecast-information\" target=\"_blank\" rel=\"noreferrer noopener\">expects the unemployment rate<\/a> to increase to 4.3% by the end of the year,\u00a0slightly above the current rate of 4.2%.\u00a0But geopolitical and economic uncertainty, combined with recent employment trends, suggest that forecast may be optimistic.\u00a0<\/p>\n\n\n\n<p>If there was a genuine positive to emerge from the latest labour force figures, it was the underemployment rate falling to its lowest level since August 2008. A larger share of working Australians are finding the hours they need, which is crucial as people continue to deal with cost-of-living pressures.&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/lh7-rt.googleusercontent.com\/docsz\/AD_4nXfkRpywnILtW9Uk_KwSWWUyKt7hCeZiHRPQD-QhvU8M2SFVHJxA09xfY0zR4xhWU7uBMr58oILSgd6ebJzr0I0dM21Zg99duMs1PzqYVb6-BHo8xL4M3Cn6j16joPRlKf9CEVO1nQ?key=CtHn38eu_hvc4_0_QbmpUQ\" alt=\"Line graph titled \u201cAustralian unemployment measures.\u201d With a vertical axis ranging from 0 to 25%, Australian unemployment measures remain low, with the unemployment rate (4.2%), the underemployment rate (5.9%) and the underutilisation rate (10.1%) all low by historical standards.\u00a0\" \/><figcaption class=\"wp-element-caption\"><em>Line graph titled \u201cAustralian unemployment measures.\u201d With a vertical axis ranging from 0 to 25%, Australian unemployment measures remain low, with the unemployment rate (4.2%), the underemployment rate (5.9%) and the underutilisation rate (10.1%) all low by historical standards.\u00a0<\/em><\/figcaption><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Australian wage growth remains healthy<\/strong><\/h2>\n\n\n\n<p><a href=\"https:\/\/www.abs.gov.au\/statistics\/economy\/price-indexes-and-inflation\/wage-price-index-australia\/jun-2025\" target=\"_blank\" rel=\"noreferrer noopener\">Australian wage growth<\/a> comfortably exceeded inflation over the past year, allowing workers to claw back some of their losses from the cost-of-living crisis. Wages rose 0.8% in the June quarter and are 3.4% higher than a year ago. That said, households aren\u2019t out of the woods yet.\u00a0<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/lh7-rt.googleusercontent.com\/docsz\/AD_4nXcT6avvUlPfhI-XO7eGQ9uGR_fsocSe5aXXWPoNqgA4IEEajE25A7tWcO1MHb2tA-m98M3Uklf4XZ6FMkt8CUwYZa6b2BOtjceyCIaZ0vEjYQPjuN2MPFPe1Z9X7kcRltcGYSgNIw?key=CtHn38eu_hvc4_0_QbmpUQ\" alt=\"Line graph titled \u201cAustralian wage growth and inflation.\u201d With a vertical axis ranging from -2 to 8%, Australian wages rose by 3.4% over the past year, outpacing inflation.\u00a0\u00a0\" \/><figcaption class=\"wp-element-caption\"><em>Line graph titled \u201cAustralian wage growth and inflation.\u201d With a vertical axis ranging from -2 to 8%, Australian wages rose by 3.4% over the past year, outpacing inflation.\u00a0\u00a0<\/em><\/figcaption><\/figure>\n\n\n\n<p>Adjusted for inflation, Australian wages are 5.8% below their peak, despite improving in the June quarter. A full recovery may take years, with the latest forecasts from the RBA suggesting little improvement this year or next. These figures highlight how damaging the cost-of-living crisis has been.<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/lh7-rt.googleusercontent.com\/docsz\/AD_4nXdUBaLXNDaIxZjgb5SqYTyHOu9gmAmSFqXzAJUUZFRjRkZwBfCKBhTo9EMNqyuwuYo-ZkQk8jX92Hr0PJCYa6rX0MY9A0lz-RVjG8t2RTVijEGNh6YQYgNMDfjVrvLkx79Wu_xarg?key=CtHn38eu_hvc4_0_QbmpUQ\" alt=\"Line graph titled \u201cAustralian inflation-adjusted wages.\u201d With a vertical axis ranging from 90 to 110 (indexed so that 2010 average = 100), Australian inflation-adjusted wages are 5.8% below their peak.\u00a0 The most recent forecasts from the RBA suggest that won\u2019t change in either 2025 or 2026.\u00a0\" \/><figcaption class=\"wp-element-caption\"><em>Line graph titled \u201cAustralian inflation-adjusted wages.\u201d With a vertical axis ranging from 90 to 110 (indexed so that 2010 average = 100), Australian inflation-adjusted wages are 5.8% below their peak.\u00a0 The most recent forecasts from the RBA suggest that won\u2019t change in either 2025 or 2026.\u00a0<\/em><\/figcaption><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Assessment and implications<\/strong><\/h2>\n\n\n\n<p>While the headline labour market data looked better in July \u2014 including employment growth and the unemployment rate \u2014 it is clear that momentum has slowed. The RBA\u2019s three rate cuts this year have been vindicated by the considerable slowdown in employment growth in the first seven months of the year.<\/p>\n\n\n\n<p>We expect another rate cut in November to provide sufficient support to households and businesses, while also ensuring that the unemployment rate remains low and we avoid recession. As of today, the RBA\u2019s job isn&#8217;t quite done yet.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Australia\u2019s labour market remains tight, but there is growing evidence that momentum has slowed. Job growth was fair in July, but overall gains have disappointed this year.<\/p>\n","protected":false},"author":103,"featured_media":12700,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"recruiter-hub-blocks.php","format":"standard","meta":{"_acf_changed":true,"footnotes":""},"categories":[1],"tags":[141],"post_mwm_category":[224],"post_topic":[],"post_content_type":[],"post_duration":[],"post_actions":[],"post_franchise":[],"post_mwm_author":[182],"class_list":["post-12699","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-uncategorized","tag-multimedia","post_mwm_category-state-of-the-labour-market","post_mwm_author-cpickering"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.2 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>July 2025 AU Labour Force Survey: Employment Growth Struggling to Keep Pace - Indeed Hiring Lab Australia<\/title>\n<meta name=\"description\" content=\"Australia\u2019s labour market remains tight, but there is growing evidence that momentum has slowed. 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