Highest labour participation to those with mortgages over $300,000

Higher participation rates in Australia's labour market come from those with mortgages over $300,000, the RBA have found.

The RBA deputy governor Guy Debelle spoke on employment and wage growth at the Australian Council of Social Service (ACOSS) National Conference 2019 in Canberra today.

Debelle noted that in recent decades female participation has grown, and the RBA believe this is due to the increase in level of mortgage debt of home owners.

"The rise in debt levels has broadly coincided with the increase in the participation rate of females," Debelle advised, however suggested it was difficult to establish which way causality is going.

Debelle then posed three questions.

"Are debt levels higher because more households have two incomes and can afford to borrow more?

"Or does the need to borrow more to afford housing drive the decision to participate more?

"Or is it the case that the low level of income growth in recent years has meant that households have more debt than they anticipated and need to work longer to pay it down?" 

There's around 95 per cent of labour participation from males who have mortgage debts of over $300,000, while females have grown to over 80 per cent.

To read the full speech, click here.