Australia is one of the advanced economies with a relatively diverse and stable labour market, despite challenges that may arise due to economic crises or unexpected events. The monthly Labour Force Survey data for January 2025 shows several important trends in unemployment rates, employment, and the employment-to-population ratio.
Unemployment rate: Relatively stable despite challenges
Australia’s unemployment rate held steady at 4.0% in January 2025, remaining unchanged from the previous month. Despite a slight increase in the number of unemployed people to 615,100, the monthly change in the rate was small. It is worth noting that youth unemployment remained at 9.0%, indicating that this age group continues to face challenges in entering the labour market.
The Australian Bureau of Statistics report also noted the importance of caution when interpreting this data in light of the disruptions in trends during the COVID-19 pandemic. These changes have contributed to significant volatility in labour market trends, which requires caution when using these figures to analyse the current situation.
Employment and employment growth: Moderate increase
The data shows that employment in Australia rose slightly by 33,700 people in January 2025, bringing the total number of workers to 14,616,400. This was a growth rate of 0.2%. The number of full-time workers increased by 19,900 people to 10,083,500, while the number of part-time workers increased by 13,800 people to 4,532,900.
Participation rate: Stable economic activity
The labour force participation rate remained at 67.2% in January 2025, unchanged from the previous month. This indicates that the proportion of working-age people who are actively participating in the labour market has not changed significantly, reflecting a relatively stable ability to engage in economic activity.
Employment to population ratio: slight increase
Participation was split between the sexes, with men’s participation highest (71.3%), while women’s participation rose to 63.2%. These figures indicate a continuing gender gap in economic participation.
Australia’s employment-to-population ratio was 64.5% in January 2025, reflecting a slight increase compared to the previous month. This ratio provides an important measure of the level of employment relative to the country’s population. The changes in this ratio, although small, indicate a slight improvement in labour market absorption.
Working hours: Slight increase in total working hours
Monthly working hours across all occupations increased slightly by 1.9 million hours (0.1%), bringing total working hours to 1,976 million hours in January 2025. This increase reflects a slight improvement in the number of hours worked nationwide. However, there was a slight decrease in seasonally adjusted working hours by -0.4%, bringing total working hours to 1,971 million hours.
Economic impacts and health crisis
The health crisis arising from the COVID-19 pandemic is one of the factors that has significantly impacted the labour market in Australia. The fluctuations in monthly trends in employment and unemployment have been significant, prompting the Australian Bureau of Statistics to issue recommendations. They advise exercising caution when using this data due to discontinuities in trends.
Part-time employment: A continued increase in the proportion
The proportion of part-time employment in Australia continues to rise, with the number of part-time workers reaching 31.0% of the total workforce in January 2025. This increase in part-time employment may reflect growing trends towards flexible work and increased demand for jobs that can be performed with flexible schedules, which reflects significant changes in the country’s economic structure.
Responding to shifts in the labour market
Australia is undergoing significant changes in its labour market as a result of economic and social changes in recent years. One of the most significant factors influencing this transformation has been the COVID-19 pandemic, which has had profound impacts on work patterns and available jobs. As the Australian government and stakeholders have adapted to these changes, multiple strategies and policies have been implemented to enhance labour market stability.
Australian government approaches
The Australian government has focused on employment support policies, introducing incentive programs for small and medium enterprises to enhance the ability to employ individuals. Training and vocational education programs have also been modified to meet the needs of the new market, where demand for different skills has increased, particularly in the fields of technology.
Labour market flexibility
One notable trend in the Australian labour market response has been expansion of flexible working opportunities. The number of part-time workers has increased significantly, reflecting the growing acceptance of this type of work among individuals and companies. This flexibility has allowed many Australians to continue working despite economic challenges they have faced.
Employment and vocational training
Stimulating fast-growing sectors such as healthcare and technology has enhanced employment programs. Authorities have allocated more resources to training and developing skills for local workers, especially in areas that lack suitable job opportunities.
The role of technology in transformation
The Australian labour market has undergone a significant transformation thanks to technological innovation, which has led many companies to develop remote working methods. These changes have contributed to creating a more flexible working environment, with work from home now possible in many sectors.
Equality in the labour market
The Australian government has also been working to improve employment opportunities for women and young people by launching initiatives aimed at promoting equality of opportunity and pay.
