BCEC Monthly Labour Market Update – March 2026

• Modest rise in employment and fall in participation combine to keep the unemployment rate steady at 4.3 per cent.
• Jobs data yet to reflect impact of fuel crisis, but data on vacancies and hours worked point to resilience in labour demand.
• Amidst considerable volatility across states and territories, signs point to strong jobs growth in the ACT.

Still a waiting game for data to reflect impact of US-Iran conflict

‘Steady’, ‘uneventful’, ‘calm before the storm’. Commentators were left vying for alternative ways of saying the March labour force figures harboured no implications for the direction of the economy or policy settings.

Lags in the availability of key economic data are creating a frustrating waiting game for hard evidence on the impact of the US-Iran war on the Australian economy. The impact on inflation is what everyone is itching to know. The latest inflation figure – 3.7 per cent for February – predates the jump in fuel prices.

The inflation figure for March, due out at the end of this month, will largely reflect only the direct effect of higher petrol prices paid by consumers. It won’t be until the CPI figure for April is released on 24 June that we will start to get a good sense of the full flow-on effects on inflation.

Most analysts are expecting further rate rises this year, some predicting as many as three further increases. Despite the inevitable jump in inflation, our view is that the risk of the economy plummeting into recession is too great for the RBA to be further tightening monetary policy next month.

That said, updated data on the ratio of unemployed persons to vacancies, reported in this MLMU, reaffirm how tight the labour market was in the first quarter of this year, particularly the WA labour market with just 1.3 jobseekers per advertised vacancy.

It’s also worth noting that while there was little scope for the March job numbers to respond to the onset of the Middle East conflict, outcomes for several other indicators that are more readily adjustable were strong. Vacancies advertised on the internet rose 1.2 per cent in March, aggregate hours worked rose 0.5 per cent, and average monthly hours worked per worker rose 0.3 per cent.

Each of these could have been readily scaled back as the conflict broke, suggesting a degree of employer confidence and resilience in the labour market in the face of uncertainty.

Are people and jobs flocking to the capital?

The March figures contained some substantive swings across the states and territories.

We’re normally reluctant to comment on large changes in figures for the two territories given their smaller populations make estimates prone to volatility. However, the results for the ACT in March were too aberrant to ignore.

Despite the number of people in employment jumping 1.3 per cent for the month, the number of unemployed persons rose by 2,400. That’s only possible if the labour force expanded substantially, and we can calculate the figures imply an additional 5,900 persons joined the ACT labour force in March, a remarkable 2.1 per cent monthly growth.

Estimates indicate the ACT working-age population has been growing relatively quickly through the year to date. However, almost all the increase in the labour force in March can be accounted for by a pick-up in participation.

This may all be unusually high sampling volatility in the estimates, or the capital just may be one place where global uncertainty creates rather than threatens jobs.