Australian unemployment is steadily growing according to new data from Roy Morgan.
In February 2025, the research firm’s ‘real’ unemployment figures increased by 214,000 people to 1,834,000. This is up 1.4 per cent and now makes up 11.5 per cent of the workforce, with significantly more people looking for work.
In January, ‘real' unemployment was 10.1 per cent. It was 9.7 per cent in December 2024, and hit a recent low of 8.6 per cent in November 2024.
According to Roy Morgan, the driver of the latest increase in unemployment were large falls in full-time employment, down 273,000 to 9,356,000, and a drop in part-time employment, down 99,000 to 4,767,000, which forced many people in the labour market into looking for new work.
In the years prior to the pandemic, employment generally fell in February, with declines in 11 of the 13 years from 2007-2019. The research firm added that this trend was disrupted by the unprecedented market conditions from 2020 to 2024.
Roy Morgan CEO Michele Levine said the latest jump in unemployment is the highest it's been for four years since February 2021.
“Since the last Federal Election in May 2022, the population and workforce have both increased by over 1.5 million and well over 800,000 jobs have been created in under three years,” Levine said. “The soaring population has meant record strong employment growth over the last two years and has been far faster than the long-term average population growth of under 300,000 per year so far this century.
“As well as the disruptions caused by the pandemic and the subsequent population growth, a ‘cost of living crisis’ – as inflation and interest rates hit multi-decade highs – has forced many people to seek employment or stay in the labour force longer than expected to make ends meet.”
In January 2020, Levine added, the workforce engagement as a percentage of the population in the workforce was around 67 per cent, while today that has increased to around 70 per cent.
“As more people join, and those already in employment remain, in the workforce, the demand for employment will obviously increase rapidly, especially in a country featuring high population growth of people of working ago.”
In addition to the unemployed, a further 1.63 million Australians (or 10.2 per cent of the workforce) were under-employed – essentially working part-time but looking for more work – down 186,000 from January. In total, 3.46 million Australians (or 21.7 per cent of the workforce) were either unemployed or under-employed in February.
Levine said that with inflation having returned to the Reserve Bank of Australia’s target range of 2-3 per cent, the pressures on many Australians to remain in the workforce longer to ‘make ends meet’ are set to lessen. This could lead to more people being willing to leave the workforce earlier than planned.
“This reduction in inflationary pressures, as well as slowing population growth compared to recent years, should contribute to more normal employment patterns reasserting themselves throughout the economy during the remainder of 2025 and into next year,” she said.
“Looking back since the last Federal Election, the rapidly increasing Australian population and workforce has led to a persistently high level of labour under-utilisation. Since July 2022, total unemployed and under-employed has been permanently above 2.5 million, and since March 2023 total labour under-utilisation has been stuck above 2.6 million and averaged nearly 3 million over the last two years.
“These figures show that as Prime Minister Anthony Albanese gets set to call a federal election in the next few weeks for mid-May, the Federal Government needs to provide greater policy clarity on how it will tackle the issues surrounding ‘cost of living’ as well as implementing policies to deal with the persistently high levels of unemployment and under-employment throughout the country.”
The February Roy Morgan Unemployment estimates were obtained by surveying an Australia-wide cross-section of people aged 14 and above. A person is classified as unemployed if they are looking for work, no matter when. The ‘real’ unemployment rate is presented as a percentage of the workforce.