Australia's employment unexpectedly dips in April, jobless hits 4-1/2 year high

SYDNEY - Australian employment unexpectedly fell in April while the jobless rate jumped to the highest level since late 2021, a possible sign the labour market might be loosening enough to stave off a near-term rate hike.

The underwhelming data led markets to pare the chance for a rate hike next month to 10%, from 20% before, following three consecutive rate increases by the central bank this year to tame inflation. A move in August is now seen as less than a coin toss.

The Australian dollar slipped 0.2% to $0.7136, while three-year government bond yields slumped 13.8 basis points to 4.568%, extending earlier declines.

Figures from the Australian Bureau of Statistics showed net employment fell 18,600 in April from March, when it rose a revised 23,300. That was far below market forecasts of a 15,000 gain. Full-time jobs dropped 10,700 after a sharp rise the previous month.

The jobless rate climbed to 4.5%, the highest since November 2021, when analysts had looked for a steady 4.3%. The participation rate eased a tick to 66.7%. Hours worked still rose a solid 0.8%.

"Compared to what we usually see in April, more people remained unemployed this month," said Sean Crick, ABS head of labour statistics.

"A drop in female employment drove the overall fall in employment ... This is the first fall in female employment since August 2025."

The RBA has raised interest rates three times this year to 4.35% to head off a war-driven global energy shock, fully reversing the amount of policy easing made last year. Annual inflation jumped to 4.6% in March, way above the target band of 2%-3%.

The labour market has stayed surprisingly resilient, and the RBA board judged some additional loosening would be needed to counter the more adverse outlook for inflation.

An ANZ survey showed Australian job ads fell 0.8% in April in the second straight month of declines, while a business survey from the National Australia Bank showed its employment index fell sharply to just +1 in April, from +6.

(Reporting by Stella Qiu and Wayne Cole; Editing by Himani Sarkar and Sonali Paul)

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This story was originally published May 20, 2026 at 9:02 PM.