Australia job boom continues

Australia's employment fell unexpectedly in July

The drought gripping Australia may be blunting the country's boom, but it is having little effect on the jobs market, new figures suggest.

More than 60,000 new jobs were created in November, the government said on Thursday, 95% of them full-time.

The number was way ahead of expectations, and could increase pressure to raise interest rates, analysts said, although worries about the drought will probably counter that tendency.

Paradoxically, the unemployment rate also crept up to 6.1%, from 6% in October, as people returned to the job market.

Balance

The boost in employment levels is partly being driven by the traditional pre-Christmas boost to the retail sector, which often does 20% of its annual business over the holiday season.

Consumer confidence still seems strong in Australia, underpinning the retail growth.

But the construction sector could be slowing after the recent boom, taking the edge off job creation.

Still, the government said it remained confident that the 60,400-job expansion in November was a trend that would continue.

"Today's figures and leading indicators pointed to solid employment growth in the months ahead" despite the global economic weakness and the drought, said Employment Minister Tony Abbott.

The government is still hoping to keep unemployment to 6% next year, he said, even though the drought is likely to hit rural area job creation.

Boost

Analysts greeted the figures with guarded enthusiasm.

"It will provide a nice boost to December quarter GDP numbers," said JB Were senior economist Tim Toohey.

But there remains some doubt about the reliability of the Australian Bureau of Statistics, given the volatility of the employment numbers over recent months.

"This series is beginning to be a bit of an embarrassment for the ABS, and it's difficult to draw any firm conclusions," Brian Redican, senior economist at Macquarie Bank, told AFR radio.

"What you can say is that unemployment does look to be moving sideways, but trying to make sense of the individual components is a fruitless task."