A strong recovery in Australia’s labor market signals the economy is rapidly recovering as the country lifts coronavirus restrictions, Treasurer Josh Frydenberg said on Friday.
Data from the Australian Bureau of Statistics showed on Thursday the nation added a record 366,100 jobs in November, overshadowing market forecasts for a recovery of 200,000, data from the Australian Bureau of Statistics showed. on Thursday.
“Yesterday’s job numbers were better than what the Treasury expected, what the Reserve Bank had forecast,” Frydenberg told CNBC’s “Squawk Box Asia,” adding that the labor market was “very strong in its return.”
The unemployment rate fell to 4.6%, from 5.2% in October, much lower than the forecast of 5.0%.
Frydenberg noted that the recovery has been broad-based, with more work being added across multiple sectors.
“You’re seeing a million jobs in manufacturing. We’ve seen hospitals reopening and accommodation services reopening. We’ve seen medical and other professional services re-opening. And of course, we have a very strong construction and mining sector as well as agriculture,” Frydenberg pointed out.
“It’s been a broad-based recovery. It’s something we’ll continue to work hard to sustain,” he added.
On Thursday, Reserve Bank of Australia Governor Philip Lowe said the labor market is expected to tighten further over the next few years. He also said the RBA’s “central scenario” is for unemployment to hit 4.25% by the end of 2022 and 4% by the end of 2023.
“If we can achieve this, these will be good outcomes – Australia has not experienced a prolonged period of unemployment this low since the early 1970s,” he said.
General risks to economic outlook
Still, Lowe said the omicron outbreak represents a “danger of downside and it’s difficult to know how things will develop from here.”
“But we expect the positive momentum in the economy to be sustained throughout the summer, underpinned by the reopening of the economy,” he added.
The outbreak of the delta variant in late June forced some of Australia’s largest cities, such as Sydney and Melbourne, to close for months. But restrictions have since been lifted following an increase in vaccinations.
Frydenberg also told CNBC keeping borders open to international travelers is key to sustaining the economic recovery.
“We had a two-week pause for skilled migrants and returning international students due to the omicron variation,” he noted. “But the early signs are the omicron variant while the high transmissibility is less severe than the earlier variants.”
“So we removed that pause and we are now welcoming international students and skilled migrants back to our country and that is a good thing,” said Frydenberg. .
