The ABS July labour market data shows unemployment edged down to 4.2% as 24,500 new jobs were added, with participation steady at 67%.
According to KPMG’s Australian Labour Market Update (August 2025), Australia’s labour market is showing remarkable stability despite the geopolitical climate.
Yet, it remains a tale of two stories. While unemployment remains historically low, annual employment growth has slowed to 1.8%, signaling signs of easing. Job vacancies remain about 25% higher than the 2019 monthly average, but applications (per job ad) are rising (although with AI making it easier for candidates to apply for multiple roles, this once-reliable forward-looking indicator may no longer reflect genuine shifts in employment trends).
Meanwhile, the Wage Price Index (WPI) has risen 3.4% over the year to June 2025. But with productivity lagging, the RBA has cautioned that long-term wage growth is unlikely to be sustained.
Our key takeaway from all of this? Australia’s labour market remains steady, with easing conditions giving employers a broader pool of candidates to choose from. However, looking ahead, the long-term outlook will depend on lifting productivity to support sustainable wages and continued jobs growth.