Job losses might be good news for Aussie homeowners

James MacSmith

Updated 21 May 2026, 2:45pm

First published 21 May 2026, 2:25pm

Desperate Aussie homeowners could be granted some much-needed relief on the back of worrying new unemployment data

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Desperate Aussie homeowners could be granted some much-needed relief on the back of worrying new unemployment data.

The Australian Bureau of Statistics announced on Thursday that the nation’s unemployment rate has risen to a four-and-a-half year high of 4.5 per cent.

The latest monthly data revealed unemployment across Australia rose 0.2 per cent over the past month, with 33,000 more people out of work.

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Reserve Bank of Australia Governor, Michele Bullock’s next move could be to drop the cash rate. Picture: NewsWire / Martin Ollman

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“Compared to what we usually see in April, more people remained unemployed this month,’ Sean Crick, ABS head of labour statistics said.

‘Both full-time and part-time employment fell, by 11,000 and 8,000 people respectively.”

It is the highest unemployment figure since November 2021 and will heighten fears the Australia economy is headed for a recession under the Albanese Government.

However the increased unemployment number could be good news for Australia’s struggling homeowners. Mortage holders have been forced to deal with three interest rate rises this year.

But a change could be in the offing.

That 4.5 per cent unemployment figure is often regarded as one which would trigger a rate cut from the Reserve Bank of Australia, a figure Australia’s central bank estimates is consistent with full employment.

An unemployment rate below 4.5 per cent indicates the labour market it too tight, putting upward pressure on wages and inflation, meaning the RBA is more likely to hold or raise the cash rate, as it did by 25 basis points earlier this month.

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Home owners might soon get some much-needed relief.

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However a rate of 4.5 per cent and above, indicates there is capacity in the labour market and inflation could be returning to the desired target of two to three per cent.

Such a scenario would support a cut in rates to stimulate the economy.

Following the announcement of the rise in unemployment, the odds of the RBA at least holding the cash rate at 4.35 per cent noticeably increased.

According to Sky News, before the data was released the chances of a hold in rates in June was 80 per cent, with a hike in rates a 20 per cent chance. Now the chances of a hold sit at 86 per cent.

However sticky inflation may throw a spanner in the works, with the Consumer Price Index sitting at 4.6 per cent, up significantly from 3.7 per cent year-on-year and well above the RBA’s inflation target of two to three per cent.

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