Unemployment remains steady at 5%: Economy Roundup

The unemployment rate remained steady at 5% in January, according to the latest figures released by the Australian Bureau of Statistics.

However, jobs growth was better than expected with the number of people employed rising by 24,000, with most of that growth in part-time jobs. A rise of only 17,000 was predicted.

The participation rate increased by 0.1 percentage points to 65.9%, while the aggregate monthly hours worked fell by 12.7 million hours to 1.58 billion.

However, CommSec economist Craig James says the result is “as variable as the weather” and suggests the resilience may not last.

“The economy has softened in the last couple of months. Manufacturing, construction and the services sector are all contracting, while businesses are trimming new orders and profitability is being affected – given the lack of activity.”

“It is important to highlight that the data is backward looking, capturing how the economy was tracking around four to five months ago. The more forward looking indicators like the job ads series suggest that while employment growth will remain a feature it is likely to be a less robust in the near-term.”

Optus revenue rises 4% in third quarter

Optus revenue increased by 4% during the third quarter to $2.38 billion, with EBITDA also rising 5% to $553 million.

Optus chief executive Paul O’Sullivan has said in a statement that despite competition, the telco is performing well, adding 150,000 new post-paid customers.

“This was achieved through differentiated mobile offerings, a continued focus on customer experience, and enhanced network coverage which now reaches 97% of the Australian population for both voice and data.”

Optus mobile revenue also grew by 7% to $1.56 billion, with EBITDA also up 4% to $371 million.

However, parent SingTel recorded a 2.2% drop in profit. It said the higher Australian dollar helped boost Optus revenue.

Transurban reports 40.3% profit boost

Transurban Group has posted a 40.3% increase in first half net profit due to strong revenue growth and several reductions in costs.

EBITDA was up 9.5% to $362.8 million during the half, chief executive Chris Lynch said, and free cash was also up 16.6% to $188.1 million.

“On the back of the upgrade to CityLink and the Lane Cove Tunnel acquisition, the business has been able to deliver toll revenue growth of 15.4% on the continuing portfolio,” Lynch said in a statement.

“With a continued focus on cost management delivering a further reduction in costs Transurban continues to grow the wedge of free cash available to security holders.”

Shares flat after weak Wall Street trading

The Australian sharemarket has opened flat this morning after a weak night on Wall Street, where five days of rallies have finally petered out.

The benchmark S&P/ASX200 index was up four points or 0.08% to 4908.8 at 12.10 AEST, while the Australian dollar maintained its position at $US1.01.

Commonwealth Bank shares rose 0.6% to $55.40, while NAB shares lost 0.4% to $25.89. ANZ shares gained 0.3% to $24.99 and Westpac shares rose 0.1% to $24.13.

STW profit gains 78%

STW Communications Group has recorded a 78% increase in full-year profit, with the company forecasting a 10% increase in underlying profit for the full financial year.

Revenue gained 12% to $309.9 million, with a final dividend of 4.2 cents per share. Chief executive Michael Connaghan said improved trading conditions had helped the company improve its financials.

“2010 was notable for market share gains for our companies in our local Australian and New Zealand home markets,” Connaghan said. “Importantly, we have also had considerable success offshore in Asia and the UK.”

Bernanke testifies before US congress

US federal reserve chairman Ben Bernanke has said American economic conditions are still too fragile for monetary stimulus to dry up.

In a statement given to the House of Representatives Budget Committee, Bernanke said the drop in the jobless rate to 9% was grounds for optimism but that the hiring situation in America is still poor.

“This gain was… not enough to significantly erode the wide margin of slack that remains in our labour market,” he added.

Bernanke also said the continued monetary stimulus is needed, and repeated his claim that it may take up to five years for unemployment to return to more normal levels.

On Wall Street, the Dow Jones Industrial Average gained 6.74 points or 0.06% to 12,239.89.