Regional Unemployment Rates Rising
Finally this trend is beginning to show up in regional unemployment rates.
Raw capital city unemployment rates declined in Greater Sydney, Greater Melbourne, Greater Brisbane, Greater Adelaide and Greater Perth.
However, unemployment rates once again increased in regional New South Wales, Western Australia, South Australia, Tasmania and the Northern Territory.
Full employment is the macroeconomic condition where almost all persons are willing and able to work at the current pricing of wages and working conditions.
Similarly when the iron ore price doubled to $90/tonne, I was working in the mining industry at that time, and as far as I recall few were predicting that the price would then relatively quickly double again (although actually thinking about it there were a few copper price forecasts from market analysts and brokers which appear to have been wildly bullish in retrospect!).
New South Wales Unemployment
The raw monthly unemployment numbers can be volatile and are prone to jumping around a bit.
Greater Sydney's unemployment rate is down to 5 percent and is now in an established downtrend.
Low interest rates have pushed dwelling prices sharply higher, retail trade is booming at double-digit pace and monetary policy settings are generally all too easy for the harbour city.
However, in regional New South Wales unemployment is clearly trending up towards 7 percent and above. This is partly related to the collapse in coal prices.
But there are plenty of risk areas, particularly in the coal and other mining regions.
There are also issues facing some outer suburban capital city areas.
We do like to share a few of them here, but space does not permit a full analysis of every suburb in Australia, and in any event, general investment advice is something to be very wary of...generally speaking.
On the other hand, low (and possibly lower) interest rates may offer investors some enticing opportunities, particularly in Brisbane.