Rachel Mealey: Australia’s unemployment rate has risen to 4.1 per cent despite tens of thousands of new jobs being created. The Bureau of Statistics says more Australians entered the jobs market looking for work, pushing the unemployment rate higher. Our business reporter David Taylor joined me a short time ago. David, what are the key numbers from this employment report and what do they tell us about the health of the jobs market?

David Taylor: Bottom line, Rachel, the unemployment rate has edged up ever so slightly to 4.1 per cent. That’s up from 4 per cent in May. Now, the participation rate increased ever so slightly in other words more people looking for work, but it’s come up to near historical highs. So there’s an enormous number of Australians think they might be able to get a job and have gone out looking for work. Whilst they’ve been looking, you’ve got full-time employment up 43,300 and Rachel, part-time employment increased by 6,800. Now, of course, in the May figures we saw a leaning towards part-time employment and that was perhaps suggesting a bit more of a vulnerable or fragile market. Look, the bottom line is there are plenty of people out there looking for work and most are finding it, but it’s getting slightly harder to find work. That said, the Bureau of Statistics says the jobs market historically, Rachel, remains relatively tight.

Rachel Mealey: So how’s the Reserve Bank likely to interpret this month’s jobs report?

David Taylor: Look, I think the word to sum it all up is neutral. This isn’t too hot, it isn’t too cold. Basically, the Reserve Bank I think will look at this and say it’s roughly where we expected it to be, so I don’t think it changes anything necessarily. Blair Chapman is a senior economist at the ANZ Bank.

Blair Chapman: If you look at June historically, it’s been pretty strong since about 2015, so this is only slightly stronger than a typical June in terms of employment growth and the unemployment rate, we were sort of expecting it to be a little changed and that’s basically what we got with a very weak 4.1%.

David Taylor: Blair Chapman, we’ve had 13 interest rate hikes by the Reserve Bank since May 2022 and there was every expectation the unemployment rate would be much higher than it is today, perhaps as high as 4.5%. How do you think the Reserve Bank will view these numbers?

Blair Chapman: Yes, I think this is probably pretty neutral for the Reserve Bank actually. So their expectation for the June quarter was a 4.0% unemployment rate on average and that’s exactly what we’ve got now. I think if you go back 12 months, they were probably expecting it to be higher, but this is on the narrow path.

Rachel Mealey: That’s ANZ senior economist Blair Chapman. And David, big iron ore producer Fortescue yesterday announced hundreds of job cuts. What are the details and could there be more mass redundancies in the mining industry?

David Taylor: Well, Rachel, some analysts have said the job losses at Fortescue show the mining giant is slowing its push into green hydrogen or abandoning its ambitions there altogether. But it could also be related to the outlook for iron ore and a troubling outlook for the Chinese economy and the construction sector slowing there or whether it is related to hydrogen, which is not developing or being developed as quickly as has been promised. The simple case, Rachel, is that we just don’t know, but there are obviously question marks about the outlook for demand for all sorts of raw materials that Fortescue is involved with. Now, in terms of the actual 700 figure, look, again, analysts have said it’s likely just simply to be lowering the overall cost base of the miner because costs are rising and that is an effective and efficient way to do it. But it’s one to watch, I think, over the coming days and weeks and certainly the potential for other miners if costs are an issue for the big miners, BHP and Rio Tinto, Rachel, whether they follow suit.

Rachel Mealey: David Taylor.