Australia's labour market held firm in March, giving the RBA plenty of runway to further increase rates to keep inflation anchored.
For March 2026:
👷🏻 Unemployment rate was 4.3% ( ↔️ )
👷🏻 14,767,700 people were employed ( ⬆️ 17,900)
👷🏻 656,300 people were unemployed ( ⬇️ 3,700)
👷🏻 Participation rate was 66.8% ( ⬇️ 0.1pts)
👷🏻 Underemployment rate was 5.9% ( ⬆️ 0.1pts)
👷🏻 Monthly hours worked were up 0.5% to 2,016 million
While the headline numbers were steady, the underlying composition still implies strength. Hours worked continues to grow faster than headcount (2.5% vs 1.8% annually). Average part-time hours per worker also lifted 1.4% in the month. This is a labour market where employers are extracting more labour from a broadly steady workforce, not one softening under pressure.
This gives the RBA some wiggle room to keep hiking into the petrol-driven inflation pulse without the risk of breaking the labour market. A increase in May, Juny, and August is now clearly on the cards and gives the RBA a good chance to keep inflation expectations anchored if the fuel crisis doesn’t deepen.