Australia's Job Market Defies Odds: 32,200 New Jobs Amid Global Uncertainty and Weather Challenges

Resilience in the Face of Adversity

Australia’s labour market showcased remarkable resilience in March 2025, adding 32,200 new jobs despite facing extreme weather events and rising global economic uncertainty. The national unemployment rate slightly increased to 4.1%, which is still below expectations, reflecting a rise in labour force participation to 66.8%, as reported by the Australian Bureau of Statistics (ABS).

Insights from ABS

Sean Crick, ABS head of labour statistics, stated, “With employment increasing by 32,000 people and the number of unemployed rising by 3,000, the unemployment rate rose slightly to 4.1% for March.” He also pointed out a rare weather-driven decline in monthly hours worked, which fell 0.3% despite the job gains. This decline can be attributed to a higher than usual number of workers reporting reduced hours due to severe weather, including ex-Tropical Cyclone Alfred affecting New South Wales and Queensland.

Wage and Employment Trends

According to Employment Hero, Australia’s job market continues to evolve, showing a year-on-year wage growth of 4.7% and an employment growth of 5.9%. Casual employment led with a 10.1% annual increase, while part-time and full-time growth remained steady at 2.6%.

Despite these positive trends, wage growth has moderated across all employment types, with casual wages slowing to 3.4% annually—a 12-month low. The construction and trade services sectors recorded the strongest wage gains at 7.8%, while retail, hospitality, and tourism lagged at 3.3%.

Economic Outlook

Dwyfor Evans, Head of Asia Pacific Macro Strategy at State Street Markets, commented: “The combination of a low jobless rate and a tighter labour force signals a lower commitment from the Reserve Bank towards further monetary accommodation and underpins what remains a relatively strong labour force.”

However, Krishna Bhimavarapu, an economist at State Street Global Advisors, cautioned about external risks: “In the middle of an escalating trade war, Australia’s labour market remains a blessing in disguise. However, a slower growth in China may impact Australia eventually… it is ideal for the Bank to deliver rate cuts to further safeguard Australia’s economy.”

While the Reserve Bank of Australia (RBA) had forecasted unemployment to reach 4.4% by mid-year, March’s lower-than-expected figure may complicate its monetary policy. Nevertheless, markets anticipate the RBA to proceed with 25 basis point rate cuts in May and July, reflecting broader global pressures and a softened inflation outlook.