Nationally, employment fell by 138,000 people as extended lockdowns in many states cause employment and hours worked to plummet.

Bjorn Jarvis, head of labour statistics at the ABS, said measures to contain the virus are having an effect on the nation’s economic indicators.

“Extended lockdowns in New South Wales, Victoria and the Australian Capital Territory have seen employment and hours worked both drop back below their pre-pandemic levels,” Mr Jarvis said.

“In September 2021, there were 111,000 fewer employed people (0.9 per cent) and 2.0 per cent fewer hours worked than in March 2020.”

Mr Jarvis said while 4.6 per cent is still a very low unemployment rate, it does not tell the whole story of how people are working during COVID-19 restrictions.

“The low national unemployment rate continues to reflect reduced participation during the recent lockdowns, rather than strong labour market conditions,” Mr Jarvis said.

“Over the past three months, participation in the labour force has fallen by over 330,000 people, with employment falling by 281,000 people and unemployment falling by 53,000 people.

“Beyond people losing their jobs, or working reduced or no hours, we continue to see how challenging it is for people without work to remain active within the labour market during lockdowns. This was also reflected in the mutual obligations for jobseekers living in lockdown areas in September.”