The Australian Bureau of Statistic released employment data today which showed the Australian economy added 26,100 jobs in March. This brought the unemployment rate down to 5.7%, which is the lowest level since 2013.
A further 20,000 jobs are expected to be added in April, which should prove to be a further boost to the economy.
When unemployment levels drop it can push wages higher, which can then lead to increasing levels of disposable income. This will be music to the ears of many companies listed on the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO), but not all of them.
Research has shown that many consumers currently have a preference for spending their money on technology and food, rather than apparel.
This doesn't necessarily help the likes of Myer Holdings Ltd (ASX: MYR), but I would expect retailers such as Harvey Norman Holdings Limited (ASX: HVN) and JB Hi-Fi Limited (ASX: JBH) to benefit from any rise in disposable income. The wide range of electronics that both companies stock should be able to satisfy the needs of consumers.
Also, consumer discretionary shares such as Domino's Pizza Enterprises Ltd. (ASX: DMP) and Retail Food Group Limited (ASX: RFG) are likely to get a boost from the lower unemployment levels. These two companies have an incredibly strong presence thanks to their extensive store network, and would be very likely to capture any increases in consumer spending.
It isn't all good news though I'm afraid. The data released today was positive enough for many to now rule out a cut to the cash rate by the Reserve Bank at its next meeting in early May.
This could also result in the Australian dollar remaining at its current level for a little while to come, or even continuing to push higher.
