Unemployment rises to 5.2 per cent

Updated

The unemployment rate has risen to 5.2 per cent, due to the loss of 27,000 jobs.

The Bureau of Statistics figures for June were unambiguously weak, with full-time jobs falling by 33,000, only partially offset by a 6,600-position rise in part-time work.

The participation rate also fell from 65.4 to 65.2 per cent, indicating that some people may have given up looking for work and left the labour force.

Aggregate monthly hours worked also fell 1.2 per cent, which corresponds to the decline in full-time jobs compared with the modest rise in part-time work, as well as the net loss of jobs overall.

However, the fall in employment was not enough to drive up the trend jobless rate, which has remained at 5.1 per cent for the past four months, and was stuck at 5.2 per cent for the seven months prior to that.

That reflects several months of relatively strong jobs data leading up to today's disappointing numbers, which some analysts have viewed as statistical payback for those previous unexpectedly strong results.

"Its a weak report, with all the losses in full-time jobs and hours worked also down. It does come after a couple of good months for jobs, so it's not the end of the world, and the fact unemployment only nudged up to 5.2 per cent is a redeeming feature," Macquarie senior economist Brian Redican told Reuters.

"That has been expected by policy makers. What would change was if we had another weak report for July, then policy makers would begin to take notice and we could get nearer a rate cut."

Economists had on average been expecting no jobs to be created in June and unemployment to rise to 5.2 per cent.

The Australian dollar fell from 102.4 US cents before the figures to 102 US cents by 11:35am (AEST).

Weakness

The Federal Government says the latest figures show the economy is still performing more strongly than other countries.

Employment Minister Bill Shorten says there is weakness in parts of the labour market but the overall picture is strong.

"The Government feels doom and gloom is not entirely justified, when you have an unemployment rate of 5.2 per cent and the United States has a rate north of 8 per cent," he said.

"The Australian economy, not just mining but services, is hanging in there, and we are doing comparatively better than a lot of the OECD."

But the Opposition's acting employment spokeswoman Sussan Ley says the figures show the jobs market is weakening.

"What we are seeing in the non-mining and non-agricultural sectors is considerable flatness and a depression almost in terms of the confidence the people working in those industries no longer have in the Government."

Topics: business-economics-and-finance, economic-trends, unemployment, work, australia

First posted