The Australian Bureau of Statistics (ABS) has publicly admitted that its unemployment numbers are wrong.
The admission comes after questions were raised following the 121,000 new jobs reported by the official statistician in August.
The ABS has concluded that the seasonal pattern previously evident for the July, August and September labour force estimates is not apparent in 2014.
This assessment was made while preparing labour force estimates for September 2014 and relates to all seasonally adjusted labour force estimates other than the aggregate monthly hours-worked series.
As there is little evidence of seasonality in the July, August and September months for 2014, the ABS has decided that for these months the seasonal factors will be set to one (reflecting no seasonality).
This means the seasonally adjusted estimates (other than for the aggregate monthly hours-worked series) for these months will be the same as the original series and this will result in revisions to the previously published July and August seasonally adjusted estimates.
“It is critical that the ABS produces the best set of estimates that it can,” acting Australian Statistician Jonathan Palmer said.
“So that discussion is on what the estimates mean, and not the estimates themselves,” Mr Palmer said.
“To assist in this, the ABS will commission a review with independent external input to develop an appropriate method for seasonally adjusting October 2014 and following months’ estimates,” he said.
“The report on the results of this review will be presented in due course.”
The ABS said it has not made this decision lightly and believes this approach will result in a more meaningful set of seasonally adjusted estimates.
ABS figures released yesterday reveal Australia’s unemployment rate increased to 6.1 per cent in September.