Where Is Full Employment?

Unemployment in Australia is now at its lowest in over 30 years. The rate for April 2007, for example, of 4.4 per cent, is substantially less than the previous trough of 5.6 per cent, in 1989. This experience of low rates of unemployment has prompted a number of statements that the Australian economy is at or very close to full employment. The Prime Minister, John Howard, says Australia is at 'Effectively full employment'. The Treasurer, Peter Costello, sees 'An economy which has got full employment or near full employment'.