The Australian Bureau of Statistics (ABS) reported on Thursday that Australia’s unemployment rate remained steady at a seasonally adjusted 3.9% in December, matching economists’ forecast and the rate reported in November. However, the data revealed that more than 100,000 full-time jobs were lost in December. This significant job loss contradicted market expectations of an added 15,000 jobs for the month.

While full-time positions dropped by 106,600, part-time jobs slightly recovered with the addition of 41,400 positions. Furthermore, the employment participation rate, which measures the number of people seeking work, fell from a record 67.3% in November to 66.8% in December. The ABS also reported a decrease in hours worked by 0.5%.

David Taylor, ABS’s head of labour statistics, said that the fall in employment in December followed larger than usual employment growth in October and November. Ben Udy, lead economist for Oxford Economics Australia, predicted a further softening of the labour market and forecasted the unemployment rate to approach 4.5% by the end of this year.

The Reserve Bank will meet in early February to update its economic forecasts, following these new job figures. Their forecast in November predicted the unemployment rate would rise to approximately 4.25% by the end of 2024. In anticipation of the bank’s meeting, all of the top four banks in Australia have predicted the Reserve Bank will cut interest rates in 2024.