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Australia records another strong month of jobs

The Australian Bureau of Statistics (ABS) has released its latest job numbers for the month of June 2018.

According to the seasonally adjusted numbers, a net 50,900 jobs were added to the total with a total of 12.57 million Australians now apparently employed.

There was a very healthy increase of 41,200 full-time employment to 8,565,200 and part-time employment increased by 9,700 to 4,008,400.

Pleasingly, the number of unemployed people deceased by 1,100. This resulted in the unemployment rate being maintained at 5.4%. All of these numbers don’t always work in tandem because of Australia’s growing population. The participation rate increased by 0.2% to 65.7%.

The seasonally-adjusted monthly hours worked in all jobs increased by 10.7 million hours, an increase of 0.6%, to 1.75 billion hours.

So, what does this mean?

It points to the strength of the underlying Australian economy and supports the GDP growth. It is also helping the Australian budget be in a much better position than expected.

It’s no secret that many Aussies are doing it tough at the moment. Household budgets are tight and debt is at very, very high levels.

But, the difference between a severe recession and a slight economic dip is most Australians remaining employed. If the unemployment rate suddenly jumped up that could lead to a big uptick in mortgage defaults for Commonwealth Bank of Australia (ASX: CBA), Westpac Banking Corp (ASX: WBC), National Australia Bank Ltd (ASX: NAB) and Australia and New Zealand Banking Group (ASX: ANZ).

A steady and healthy unemployment rate also means continued sales for retail businesses like Wesfarmers Ltd (ASX: WES), JB Hi-Fi Limited (ASX: JBH) and Woolworths Group Ltd (ASX: WOW).

It also means that Seek Limited (ASX: SEK) is getting a good amount of job ads every month.

However, if a recession does happen in the future driven by Australia’s indebtedness, this top share could be a great one to own and could generate even more profit in rough times.

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Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Wesfarmers Limited. The Motley Fool Australia owns shares of National Australia Bank Limited. The Motley Fool Australia has recommended SEEK Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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