Australian Employers Cut 21,400 Jobs

Australian employment fell in June as the global recession reduced demand for exports such as iron ore and coal, prompting mining companies to fire workers.

The number of people employed dropped 21,400 from May, the statistics bureau said in Sydney today. The jobless rate rose to 5.8 percent, the highest level in almost six years, from 5.7 percent.

Central bank Governor Glenn Stevens left borrowing costs at a half-century low of 3 percent this week for a third month to help stem firings at companies including BHP Billiton Ltd. Advertisements for job vacancies tumbled in June for a 14th month, a sign unemployment may rise in coming months.

The number of full-time jobs dropped 21,900 in June and part-time employment increased 400 today’s report showed.

Australia’s economy has so far skirted the worst global recession since the Great Depression. Gross domestic product rose 0.4 percent in the first quarter, making it one of the few major economies including China and India to expand.

To help boost employment and cushion the economy against slower global demand for natural resources, Prime Minister Kevin Rudd’s government has distributed A$12 billion ($9.3 billion) in cash handouts to households this year and is spending A$22 billion to upgrade roads, railways, hospitals and ports.

Central bank policy makers also slashed the overnight cash rate target by a record 4.25 percentage points between September and April to 3 percent.

BHP Billiton, the world’s biggest miner, is shedding 3,400 workers in Australia after shuttering a nickel mine in January and reducing coking coal output. Qantas Airways, the nation’s largest carrier, said in April that it will cut 1,750 jobs as demand for business and first-class travel wanes.

The participation rate, which measures the labor force as a percentage of the population aged over 15, fell to 65.3 percent in June from a revised 65.4 percent, today’s report showed.

Australian Employers Cut 21,400 Jobs, Bloomberg
7/8/2009 10:44:08 PM