Tony Abbott has apologised for labelling job losses a "holocaust" as he faced questions over the government's economic plans.
The prime minister came under pressure in question time after Australia's unemployment rate hit 6.4 per - it's highest level since mid-2002 - and was expected to go higher over the year.
Questioned over speculation he has already signed Australia to buy Japanese-made submarines, Mr Abbott told parliament Labor in government had let defence industry jobs decline by 10 per cent, as it fumbled big project contracts such as submarines.
"There was a holocaust of jobs in defence industries," he said.
Mr Abbott subsequently apologised and withdrew the comment.
"But what I should also say is whatever happens with our future submarines project there will be more jobs for South Australia," he said.
Labor frontbencher Mark Dreyfus said the comment would be deeply offensive to survivors of the Holocaust, the murder of six million Jews by Germany's Nazi regime in World War II.
"Comments like this should have no place in Australian political debate and should never have been made in the first place," Mr Dreyfus said.
The dictionary definition of holocaust is "wholesale destruction of life".
Opposition Leader Bill Shorten said the government had taken its eye off job creation as the Liberals argued over the leadership.
"When will the prime minister stop worrying about his own job and start worrying about the jobs of Australians?" he said.
The prime minister earlier scolded a broadcaster for being impertinent and claimed his "outstanding" team had made only one big mistake in 17 months.
He also took aim at the Australian Human Rights Commission as he responded to its report of an inquiry into children in immigration detention.
He said the commission should be ashamed of itself, because of its "blatantly partisan" exercise that, among other things, recommended a royal commission.
He said while 2000 children were in detention under the Labor government, his government has reduced the number to 200.
Asked whether he felt any guilt over the way children were treated in detention, Mr Abbott said: "None whatsoever."
"The most compassionate thing you can do is stop the boats," he told Fairfax Radio.
Asked whether he would respond to Liberal backbench concerns by dumping his chief of staff Peta Credlin, Mr Abbott told broadcaster Neil Mitchell it was an "impertinent question" and he stood by her.
The long-standing bipartisan approach to national security took a battering on Thursday when the prime minister accused Labor of allowing terrorists to leave Australia because of the former government's "bad systems".
Opposition business manager Tony Burke asked the prime minister how terrorist Khaled Sharrouf was allowed to leave Sydney last year despite being on a watchlist.
Mr Abbott also went into detail about a video he had been briefed on in which two Australian terror suspects allegedly swear to kill people on behalf of Islamic State.
"I don't think it would be possible to witness more monstrous extremism than this, and I regret to say it is now present in our country."
