Good friend Andy Mukherjee has inaugurated a monthly column in India’s Business Standard with a good piece on Australia. The piece, despite the confines of space allotted to a column deals with many things: the boom in resources trade, the peak in Australia’s terms of trade, Australian household prudence, India’s readiness (or, the lack of it) to replace China as the source of demand for Australian resources, etc.
I agree with his conclusions on the Australian boom being on its last legs. I have been saying this for a while Every time I think data have finally turned in my favour, comes one strong piece of economic data that raises question marks on the obituaries being written for the Australian mining boom.
The employment report for March is a case in point. Australia added more than 40,000 jobs in March. It is an extremely high rate of job creation in the context of the size of the Australian economy. It featured a good mixture of full-time and part-time jobs. More than one State experienced job creation. Hours worked went up. The unemployment rate was unchanged but the participation rate went up. It was hard to find a chink in the report. One wonders if seasonal adjustment factors have gone haywire. Other than that, there is no other way to pick holes in the report.