ABS Revises May Underemployment Rate Up to 6.6% After 0.5-Point Systems Error
Updated
Updated · Westpac IQ · Jul 17
ABS Revises May Underemployment Rate Up to 6.6% After 0.5-Point Systems Error
1 articles · Updated · Westpac IQ · Jul 17
Summary
May’s underemployment rate was lifted to 6.6% from 6.1% after the ABS said a systems error had skewed the original release, taking the measure to its highest level since August 2024.
The revision also nudged up recent months and shifts the trend from broadly flat to clearly rising, reinforcing signs that labour-market slack is building beyond the headline 4.4% unemployment rate.
Westpac said employment growth has effectively stalled across April and May, while business surveys point to weaker hiring ahead, including a 9-point drop in NAB’s year-ahead employment expectations in Q2.
Broader ABS 'u-series' underemployment gauges have risen even faster since February—up 0.6 percentage points for UD-4 and 0.9 points for UD-1—suggesting more workers are actively seeking extra hours.
The ABS plans to make the broader underutilisation measures official by mid-2027, while Westpac expects slow job growth and resilient participation to push unemployment higher later this year.