Doubt the jobs data at your peril - again

Thu, 10 Dec 2015  |  

Today's labour force data, showing a further nice lift in employment and a further tick lower in the unemployment rate, has been met with howls of derision. The bagging and slagging of the ABS labour force release has been especially strong from those calling for rate cuts in September, whoops; October, whoops; November, whoops; December, whoops some time in 2016.

“The numbers are wrong”, they scream; “it’s sample rotation”, they holler; the strong GDP data (which fit with the solid pace of job creation) was all exports so the jobs numbers, especially in NSW, “can’t be right”.

Any fund manager investing on the basis of these data doubters will have been smoked. The data doubters have been very bearish the Aussie dollar – calls for low to mid 60s are common (some even were looking for 50 cent if I recall correctly), linked it appears to aggressive interest rate cuts from the RBA. The recession, so often forecast, remains ellusive. 

In the last few months, the Aussie dollar has been strong and is currently holding around 72.5 to 73 US cents, with nice gains against the Euro, British pound and Canadian dollar. The futures pricing for official interest rates has gone from two further rate cuts (to 1.5 per cent) just a couple of months ago, to now having less than a 50% possibility of one final 25bp cut. That is jump of 40bps. The bond market has been similarly smashed – the yield on 10 year government bonds, for example, are up 35bps or so from the October low and are up around 70bps from April.

And how do the smarties know the ABS data are so horribly wrong? To be sure, the monthly results are choppy and a little over a year ago there was a problem that the ABS appears to have addressed. And oddly enough, there is no other data source for employment so how can they be sure the level of employment is not what the ABS suggests? The local shops were quiet? A housing crash?

And for those of us who undertake sober analysis of the growth in ANZ job advertisements, job vacancies, economic growth and its composition, and the effect of record low wages growth on labour demand, the ABS labour force data are more “right” than not and the rise of the Aussie dollar and bond yields is entirely sensible. 

comments powered by Disqus



Wed, 29 Jul 2020



Covid19 has opened a door for Australians to positively accept significant changes that will lead to a shared good. This rare opportunity enables us to achieve sustainable economic and social goals that create a new ‘normal’ as our way of life.

These Ten Steps are presented as non-partisan recommendations to the Australian Parliament in the firm belief that, if they embrace them, the Australian economy and society will be greatly enhanced after the Covid19 pandemic has passed.

*A job for you if you want one.
A significant increase in part time and casual employment can be created that will enable you to enjoy a more creative and peaceful lifestyle and to live longer and better. The traditional age at which you would have been expected to retire will become obsolete as a result. An access age for pension and superannuation will become your choice. This will enable you to remain in paid work for as long as you want to, on a basis that you choose, while boosting the productivity and growth of Australia.

*You will get wage increases that will be greater than your cost of living.
A demand for enhanced innovative skills at all levels of employment will be created as the economy grows in strength, thereby enhancing your stature in the workforce and enabling executive salaries and bonuses to drop to levels that are accepted as justifiable by employees, shareholders and customers.

The misplaced objective of the government of delivering a surplus, come hell or high water, has gone up in smoke

Tue, 07 Jan 2020

This article first appeared on the Yahoo Finance web site at this link:   


The misplaced objective of the government of delivering a surplus, come hell or high water, has gone up in smoke

For many people, the cost of the fires is immeasurable. 

Or irrelevant. 

They have lost loved ones, precious possessions, businesses and dreams and for these people, what lies ahead is bleak.

Life has changed forever.

As the fires continue to ravage through huge tracts of land, destroying yet more houses, more property, incinerating livestock herds, hundreds of millions of wildlife, birds and burning millions of hectares of forests, it is important to think about the plans for what lies ahead.

The rebuilding task will be huge.

Several thousands of houses, commercial buildings and infrastructure will require billions of dollars and thousands of workers to rebuild. Then there are the furniture and fittings for these buildings – carpets, fridges, washing machines, clothes, lounges, dining tables, TVs and the like will be purchased to restock.

Then there are the thousands of cars and other machinery and equipment that will need to be replaced.