The rationale is that, because these tools incur a direct distributional cost on affected households, elected politicians are needed to maintain legitimacy. However, in the Reserve Bank’s view, the controversial nature of these tools strengthens the case for operational independence, to ensure that the tool can be used promptly when necessary.
The active job openings-to-applicants ratio has continued to rise, marking 1.52 for September and reaching a level seen in 1974 (Chart 5). The unemployment rate has declined to the range of 2.5-3.0 percent, which is equivalent to virtually full employment. Against the background of such tightening of labor market conditions, wages have risen moderately, mainly for part-time employees.