Inflation

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Question 37
Easy

The Australian labour market in 2023

The Australian labour market experienced notable shifts following global economic adjustments. Data published by the Australian Bureau of Statistics (ABS) in November 2023 showed steady employment gains alongside shifting participation rates.

Fig. 1 – Australian labour market statistics for August to October 2023

Number ('000)Change on previous quarter ('000)Change on previous year ('000)
Employed14 12085312
Unemployed530–15–54
Economically Inactive (Aged 15–64)3 650–812

Source: ABS

Key observations from the November 2023 data release included:

  • average weekly earnings for full-time employees increased by 4.5% in nominal terms compared to the previous year.
  • average weekly earnings for employees decreased by 1.2% in real terms compared to the previous year.
  • sector growth was strongest in health care and social assistance, while retail trade saw minor contractions.
  • underemployment remained a structural feature, with 10.4% of part-time workers wanting more hours but unable to secure them.

Refer to the bullet points above. Identify and explain why the change in average weekly earnings in nominal terms is greater than the change in real terms.

[2]

Inflation Questions

  1. A Level
  2. /Economics
  3. /Inflation