Australia: Selected Issues

February 9, 2017

Preview Citation

Format: Chicago

Australia: Selected Issues, (USA: International Monetary Fund, 2017) accessed September 19, 2024

Summary

This Selected Issues paper examines the adjustment of Australian labor markets to the recent adverse shocks. Australia’s labor markets were not severely impacted by the global financial crisis and are adjusting smoothly to the sizeable commodity prices bust and mining investment downturn. However, some labor market indicators suggest persistent weaknesses. There does not appear to be a significant increase in structural employment in the wake of the commodity prices bust and mining investment decline. Increased flexibility in average hours per worker has likely moderated employment reduction in downturns and prevented a larger increase in unemployment in the wake of the mining investment downturn. At the same time, elevated underemployment signals additional slack, and is likely weighing down wage growth.

Subject: Employment, Fiscal policy, Inflation, Labor, Labor markets, Prices, Unemployment

Keywords: Adjustment dynamics, CR, Debt norm, Debt rule, Employment, Global, Headline inflation, Inflation, Inflation expectation, ISCR, Labor market slack, Labor markets, Long-term debt anchor, Mining investment downturn, Monetary policy, Monetary policy strategy, Near-term inflation outlook, Output gap, Output-inflation trade-off, Rate, Terms-of-trade bust, Transmission mechanism, Unemployment

Publication Details

Pages:

104
Volume:

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DOI:

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Issue:

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Series:

Country Report No. 2017/043
Stock No:

1AUSEA2017002
ISBN:

9781475575842
ISSN:

1934-7685

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