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Australia’s labor market bounced back in July, showing signs of strength that could make the Reserve Bank of Australia more cautious about cutting rates further.
Data from the Australian Bureau of Statistics showed that the economy added 24,500 jobs during the month. That was just shy of the 25,300 economists expected, but a big improvement from the tiny 2,000-job gain in June. The unemployment rate slipped to 4.2% from 4.3%, matching forecasts, while total hours worked also increased after falling the previous month.
The rebound was driven by a surge in full-time employment, which jumped by 60,000 positions. This was a sharp turnaround from June, when full-time jobs fell by more than 38,000. The gains were partly offset by a loss of 36,000 part-time roles, suggesting employers were favoring more permanent hires.
The participation rate—the share of the population in the workforce, held steady at 67.0%, slightly below expectations of 67.1%.
The stronger job figures come just days after the RBA cut interest rates by 25 basis points, its third cut this year. Policymakers also signaled they were open to easing further if economic data justified it. However, a labor market that is still tight could complicate that decision, as strong employment often keeps upward pressure on wages and inflation.
For now, the numbers suggest Australia’s economy is holding up better than some feared, even as the central bank tries to balance supporting growth with keeping inflation under control.