Unemployment rate to rise slightly

The unemployment rate is exepcted to rise to 6.1 per cent in July from six per cent in June, when official jobs figures are released on Thursday.

The unemployment rate is expected to rise slightly as slowing jobs growth fails to keep up with population growth.

The number of Australians with jobs is forecast to have risen by 10,000 in July, according to an AAP survey of 15 economists, after a gain of 7,300 in June.

That will push up the unemployment rate to 6.1 per cent from six per cent in June.

The Australian Bureau of Statistics will release its jobs figures on Thursday.

Commonwealth Bank's John Peters said employment growth in the booming housing sector is helping keep the unemployment rate mostly steady.

"Construction jobs growth in the dwelling sector is probably helping offset job losses in the mining sector in wake of the fade out of the mining investment and construction booms," he said.

Mr Peters said that the Australian dollar, which has fallen about 10 US cents since the beginning of the year, is also helping the non-mining parts of the economy pick up the slack left by mining.

JP Morgan economist Tom Kennedy said a surge in services sector jobs has helped the unemployment rate drop to six per cent from 6.2 per cent at the beginning of the year.

"The healthy performance of the labour market is even more surprising given the lacklustre pace of economic growth," he said.

"The slide in the exchange rate has contributed to a steady rebound in inbound tourism, as evidenced by the upturn in services exports."

The latest ANZ job advertisements survey, a key indicator of the jobs growth, showed the number of job advertisements on the internet and in newspapers fell 0.4 per cent in July.

ANZ chief economist Warren Hogan said the small decline comes after a period when job ads growth was slowing, not helped by subdued household spending.

"The slower growth in job advertising supports our view that employment growth will slow in the second half of 2015 following unexpectedly strong outcomes since late 2014," he said.

Mr Hogan said that the change in the type of jobs that are being created is putting a brake on income growth.

"Aggregate household income has expanded only modestly as the large number of services jobs being generated are paid significantly less than the jobs lost in the mining and manufacturing industries," he said.

"As a result, growth in household spending has remained sluggish."

UNEMPLOYMENT SET TO SLIP HIGHER IN JULY

* Unemployment rate rise to 6.1pct from 6.0pct in June

* Employment growth is tipped to be 10,000

* Employment change forecasts ranged from a fall of 5,000 to a gain of 15,000

* Participation rate forecast to be 64.8pct

(Source: AAP survey of 15 economists)


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Source: AAP


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