The Australian Bureau of Statistics (ABS) has reported the September 2018 job figures today.
Seek Limited (ASX: SEK) shareholders can be happy knowing that seasonally adjusted employment increased by 5,600 people to 12.64 million people. The more jobs that are in the system the more job ads Seek could potentially expect.
That doesn’t sound like much of a change – it hides the larger adjustments. Full-time employment increase by 20,300 but part-time employment decreased by 14,700.
Thankfully, unemployment decreased by 37,200 to almost 666,000. This resulted in the seasonally adjusted unemployment rate decreasing to an impressive 5%, the best it has been for a while.
Monthly hours worked in all jobs increased by an impressive 6.2 million hours, or 0.4%, to 1.76 billion hours. That’s a lot of work getting done!
Despite the doom and gloom of falling property prices and declining construction, the key to maintaining a strong Australian economy is the number of people employed.
It’s much easier to pay your mortgage or rent, the energy bills, the food, drinks and so on if you’re employed.
However, record numbers of Australian households are facing mortgage stress so the employment rate will be a key statistic to focus on in the coming months.
Some bearish market commentators have suggested that a slowdown in construction is all Australia needs to tip the country into economic decline territory. However, a large Federal and State infrastructure spending bonanza could be perfectly timed to smooth out employment and the GDP figures.
I think the best way of going about things is to hope for the best but prepare for poor conditions. I wouldn’t want too much of my portfolio invested in fair-weather shares at this stage in the cycle. I’m avoiding bank shares like Commonwealth Bank of Australia (ASX: CBA).
Instead, I’m investing in quality defensive shares such as this top stock which could easily ride through any economic downturn.
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Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. 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.