Unemployment edges up to 5.8 per cent: ABS jobs data

Updated

Unemployment has edged up to 5.8 per cent, despite the estimated creation of 7,900 jobs.

Key points: Unemployment rises from 5.7 to 5.8 per cent

38,400 full-time added, 30,600 part-time lost

Participation rises to 64.9 per cent

It is the first time in five months that unemployment has gone up in Australia.

The result was broadly in line with market expectations, with the typical analyst expecting a 10,000-strong jobs gain and a 5.8 per cent unemployment rate.

However, the figures were stronger than they looked, with the modest jobs gain driven entirely by full-time positions, which rose by 38,400, while the number of part-time jobs fell 30,600.

The participation rate - which measures the proportion of the working-age population in work or looking for it - edged higher to 64.9 per cent.

On the downside, hours worked fell slightly last month according to the Bureau of Statistics, despite the apparent increase in full-time work.

Overall, Commonwealth Bank economist Gareth Aird said it will be seen as a fairly steady jobs update by financial markets and the Reserve Bank.

It's not a game changer one way or the other.

"The focus of the Reserve Bank I would say is inflation, but if you're just looking at the labour market then today's figures don't argue for a rate cut.

"But we know that inflation is so low and wage growth is so weak ... if we get another quite weak CPI [consumer price index] in another couple of weeks, then that would be the trigger for another rate cut."

Employment growth 'better than the decade average'

Sorry, this video has expired Video: Michaelia Cash says unemployment rate rise was expected (ABC News)

Employment Minister Michaelia Cash acknowledged at a press conference that the unemployment rate is roughly the same now (5.8 per cent) as it was when the Coalition took office in 2013 (5.7 per cent).

However, Senator Cash said employment growth has been stronger over the past year.

"Employment growth in Australia over the last 12 months was 1.9 per cent. You can compare that to the decade average of 1.7 per cent and we are certainly doing better than the decade average," she said.

Labor's employment spokesman Brendan O'Connor played down last month's jump in full-time jobs as a statistical anomaly, and argued the recent trend had been towards part-time work.

He also attacked business group arguments that lowering Sunday penalty rates would lead to stronger jobs growth.

"In fact, taking money out of the economy, and that is what would happen if you take money from people's wages and put it into shareholders' pockets, many of whom do not live in Australia, does not improve the economic prospects of this nation," he said.

"It is completely a fallacious argument to suggest that by cutting lower rates, you will see better employment growth. Less money will be spent on goods and services. Low-income earners spend their entire income."

Topics: economic-trends, unemployment, australia

First posted