Australia's 'stunning' jobs report, wage pressure 'will only grow'

A snippet via Westpac on the jobs report.

ICYMI:

• Australian May Employment Change +115.2K (expected +30K) & Unemployment Rate: 5.1% (expected 5.5%)

WPAC's note is detailed, I pulled out mainly their comments on the potential for wage growth ahead:

• stunning outcome
• a very robust update
• suggesting firms are finding the workers they need at the price they are willing to pay
• While firms have been reluctant to pay higher wages to get the workers they need, they do appear to be adapting to conditions and with the fall in underemployment, the pressure will only grow as the supply of labour is struggling to match demand

The point about wage growth (which, up to now has been very slow) is that the RBA wants it at around 3 to 3.5% to help drive inflation towards the Bank's target.

Added ... ANZ comments:

• Australia's underemployment rate has fallen to 7.4%, its lowest since early-2014
• The shrinking pool of underemployed workers will be an important catalyst for businesses to lift wages, as they have less "available" labour to draw on quickly