Australia’s unemployment rate reached 10.5 percent in March, marking the highest level in over three decades, according to new data from Roy Morgan. This figure represents approximately 1.69 million people without work, following a decline in the labor force of about 78,000 in a single month. Alongside unemployment, underemployment also rose sharply, with 1.69 million Australians—or 10.4 percent of the workforce—working fewer hours than they desire.

Combined, these statistics indicate that more than 3.38 million Australians, or nearly 21 percent of the labor force, were either unemployed or underemployed in March. Roy Morgan chief executive Michele Levine highlighted that this elevated level of joblessness and underutilization has persisted above three million for sixteen consecutive months.

Analyst Julian McCrann noted that, setting aside the COVID-19 pandemic period, the current unemployment rate is the worst since the recession of 1992-1993. He emphasized the effect on consumer sentiment, pointing out that confidence levels have plummeted to record lows sustained for at least a month, levels unseen even during a prolonged four-year decline.

Regional disparities were evident in the data, with New South Wales experiencing a combined unemployment and underemployment rate of 18.6 percent, equating to some 910,000 residents affected. Rural areas of the state were hit hardest, with a rate of 21.1 percent. Among Australia’s capital cities, Sydney registered the lowest combined rates of joblessness and underemployment, whereas Adelaide reported the highest.

In response to the economic data and amid ongoing global uncertainty, Treasurer Jim Chalmers acknowledged international warnings of a looming global recession, citing factors such as the cost-of-living pressures and ongoing conflict in the Middle East. While the International Monetary Fund (IMF) has cautioned that the global economy faces its third recession of the century if the Strait of Hormuz remains closed, Chalmers maintained that Australia is in a comparatively strong position.

Nonetheless, the Treasurer acknowledged that lingering effects from the Middle East conflict are expected for some time, even after the resolution of hostilities and reopening of critical trade routes. He also underscored the significance of the IMF’s assessment that certain cost-of-living interventions, including the recent fuel excise cut costing the federal budget $2.55 billion, may be ineffective and potentially inflationary.

Looking ahead to the federal budget scheduled for May, Chalmers said the prospect of a global recession and its potential impacts on inflation and economic growth will be key considerations, stating that forecasts anticipate a slowing of the Australian economy alongside sustained inflationary pressures.