FRIDAY, 19 MAY 2023
SUBJECTS: Jobs figures; May Budget; Wages
NATALIE BARR: A surprise increase in the unemployment rate could be enough to ward off another interest rate rise. 4,300 Aussies lost their jobs last month, lifting unemployment to 3.7 per cent. It’s in stark contrast to the 25,000 extra jobs economists had predicted.
Joining me now are Education Minister Jason Clare and Deputy Liberal leader Sussan Ley. Good morning to both of you.
SUSSAN LEY: Good morning.
BARR: Jason, why are 4,000 more Aussies out of work when there’s supposed to be a shortage of skilled labour in this country?
JASON CLARE, MINISTER FOR EDUCATION: Good morning, Nat. We certainly want to see as many Aussies in jobs as possible. Unemployment is very, very low at the moment, it’s at almost historic lows. It’s good to see that we’re seeing wages moving again as well, but certainly we’re seeing an impact of those interest rate rises slowing the economy down.
Inflation is still the big challenge in the economy and we’re seeing those interest rate rises biting at the supermarket and with mortgages as well. That was what the Budget last week was all about, bringing the Budget back into surplus, paying down debt, but also making sure that we help Aussies that are doing it really tough.
BARR: So, Sussan, a NAB study has just said that nine in ten Australian businesses are still struggling to get workers. Why has this happened? Why has the unemployment rate actually gone up?
LEY: Well, the unemployment rate is sneaking up, Nat, and yes, there are jobs out there. But what worries me when I see those unemployment numbers start to go up is that behind every job loss there’s a family, there’s someone who can’t pay the bills perhaps. There’s a community, there’s a school, there’s heartache. We have to acknowledge that. It’s more than just a statistic.
Jason talks about inflation being the main game, he’s absolutely right. I’m not confident the Budget was the right budget to deal with that. We saw in the budget that the cash rate would stay at 3.85 until early 2024. Now that is a little bit surprising. I raised my eyebrows a bit at that. If we don’t keep inflation under control then we have problems in the economy, including unemployment, and if we don’t have a proper plan to tackle inflation unfortunately the RBA has to do the heavy lifting. It has to raise rates and we know what that means for people’s mortgages and generally their cost of living.
BARR: Jason, does this weaken the case for an interest rate rise now?
CLARE: That’s a matter for the Reserve Bank, they’re independent, but certainly the tick up in unemployment is one of the things that they’ll take into account. I guess I’d say to Sussan, she’s criticising the Budget and the impact on inflation, what part of the Budget will you vote against? If your argument is that the Budget’s not good for inflation, what part of the Budget are you planning to vote against?
LEY: Well, that’s a longer conversation, Nat and Jason, but I just want to put this figure to you. For every one dollar of saving there is two dollars of spending in the Budget. And instinctively Australians who manage their household budgets know that something’s out of kilter there and something’s got to give.
So, we’ve talked a lot about the things we like, the things we don’t like. On the matter of unemployment, because, as I said, I worry about what it means for ordinary Australians who lose their jobs. We want to work with the Government. We want to get this right. We don’t want to see that cost‑of‑living crisis, that cost of groceries, cost of fuel, cost of rents and your mortgage continue to go up. It is a real worry.
I’ve travelled the country and I know Jason gets out and about too, Nat, and when you talk to businesses and when you talk to school communities, you really feel that anxiety and you see it in people’s faces.
BARR: So, Jason, the unions want an increase in wages. This is what they’re going for because obviously it’s, you know, way below inflation. Will this unemployment rate change that?
CLARE: We don’t want to see Aussies on the lowest wages go backwards. That was a big part of the election campaign this time last year. This time last year when Scott Morrison was tackling a kid here in Tasmania, we were making the argument that a little bit of an increase for people on the minimum wage won’t hurt the economy and it’ll help a lot of Australians now.
BARR: And what do you say now?
CLARE: It’s one of those big differences. Our position is the same. We don’t want to see Aussies on the minimum wage go backwards.
BARR: And so what would you be pushing for, for the National Wage Case, for the Fair Work Commission?
CLARE: We haven’t put a number on it, but we’ve said to the Fair Work Commission that we don’t want to see Australians on the minimum wage going backwards. It’s not the reason that we’ve got a problem with inflation in the economy that people on the lowest wages are being paid too much. That is not the reason that we’ve got a problem with inflation at the moment.
BARR: Okay, thank you both. We’ll see you next week.
LEY: Thank you.
Media Contact: Nick Trainor 02 9790 2466