AUSTRALIA has posted its strongest monthly employment growth in 13 years, confounding expectations as the unemployment rate held steady for a third straight month.
Prime Minister Julia Gillard said the 71,500 surge in the number of people employed last month highlighted a resilient economy, as economists downgraded expectations of another central bank interest cut.
The Australian Bureau of Statistics said 17,800 people gained full-time employment in February, while the number of people in part-time work rose by 53,700, as the jobless rate remained at 5.4 per cent.
Economists had expected an 8000 rise in the number of people employed and the jobless rate to tick up to 5.5 per cent.
Government ministers applauded the figures, which Ms Gillard noted was largest monthly employment increase since July 2000.
“That tells you about the resilience of the Australian economy and we should be proud of it as a nation,” she told parliament on Thursday.
Employment Participation Minister Kate Ellis described it as an “extraordinary result”.
“Had more people not felt confident and gone out to apply for work, in fact we would have seen a substantial decrease in the unemployment rate,” she told reporters in Canberra.
Treasurer Wayne Swan said the “impressive” outcome contrasted sharply to the 11.9 per cent unemployment rate in Europe, where countries were slipping back into recession.
Shadow treasurer Joe Hockey said the addition to the local workforce was “rather remarkable”.
But he also reminded Mr Swan of his commitment in May 2011 to create 500,000 new jobs over the next two years to 2013.
He said an “unbelievable” 266,800 jobs would need to be created in the four months to the end of June to meet the target.
“This will be yet another broken promise from Wayne Swan and the Gillard government,” Mr Hockey said in a statement.
Economists said the jobs report justified the Reserve Bank of Australia’s (RBA) decision to leave the cash rate at three per cent this year.
Financial markets now see a 50/50 chance of a cut to a record low of 2.75 per cent towards the end of the year.
“We will need to see this (jobs) strength reversed to bring rate cuts back onto the agenda,” Macquarie Research senior economist Brian Redican said in a client note.
The central bank reaffirmed last week it had scope to cut the cash rate if needed, given the benign inflation outlook.
Other data on Thursday showed consumers expect price pressures to remain subdued.
The Melbourne Institute’s consumer expectations survey centred on an inflation rate of 2.3 per cent over the next 12 months – within the RBA’s two to three per cent inflation target band.
“Given current modest inflationary expectations, it is highly likely the RBA will not tighten monetary policy until activity exhibits strong momentum,” institute research fellow Viet Nguyen said in a statement. – AAP