The modest declining trend in Australia's jobless rate has more to do with a lack of workers than a surge in jobs.
That's the view of Chris Richardson, economist at Deloitte Access Economics in his latest quarterly business outlook released on Monday.
"Job growth is only moderate, but the gathering pace of retirement among baby boomers means that it has still been enough to move the unemployment rate down," he says.
He says the strength in the accommodation, food and recreation sector, thanks to a lower Australian dollar, and job loses among mining and utilities workers is why part-time workers have been "zipping along" and full-time employment has been in the slow lane.
The latest official labour force figures for September are released on Thursday.
Economists at Commonwealth Bank are predicting a modest 15,000 increase in the number of people employed in the month after the 3900 drop in August.
However, this is not expected to be enough to prevent the the jobless rate ticking up to 5.7 per cent in September after dipping to a three-year low of 5.6 per cent the previous month - easing from 6.1 per cent in the past year.
Mr Richardson says inflation is becoming ever more scarce, which will keep low interest rates lingering for longer, but expects the Reserve Bank has become a "reluctant cutter" from here.
"In cutting rates of late, the RBA has had to ignore solid growth, falling unemployment, eye watering household debt, and housing prices that are more pumped than an '80s East German Olympic sprinter," he said.
A jump in commodity prices has led to the first good news on national income growth for some time.
But he warns too many things Australia depends on are now "priced for perfection".
"The higher go the prices for iron ore and coal and homes in Sydney and Melbourne, the greater the risk that something goes wrong down the track," Mr Richardson said..
