Jobs market tighter still

August 9, 2007 - 11:57AM

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A further 21,800 jobs were added to an already tight labour market in July, supporting the Reserve Bank of Australia's (RBA) decision to lift interest rates yesterday.

But despite this employment rise, the jobless rate held steady at a seasonally adjusted 4.3 per cent in July, reflecting the addition of 30,000 single parents seeking work as part of the Federal Government's welfare for work reforms, economists say.

The seasonally adjusted rise in employment was mostly full-time workers, according to data released by the Australian Bureau of Statistics today.

Economists forecasts had centred on a 25,000 employment rise and a jobless rate of 4.4 per cent.

The RBA raised interest rates for the first time since November last year yesterday, citing renewed price pressures in the economy.

This lifted the cash rate to a near 11-year high of 6.50 per cent from 6.25 per cent.

Economists say there is the risk of a further rate rise late this year, or in the early part of 2008.

Among the states, the jobless rate in NSW remained at 4.7 per cent in July, while in Victoria it fell to 4.4 per cent from 4.6 per cent.

In Queensland the unemployment rate was 3.6 per cent compared with 3.5 per cent previously, in South Australia it rose to 4.9 per cent from 4.8 per cent, and in Western Australia it dropped to 3.3 per cent from 3.8 per cent.

In Tasmania, the rate fell to 4.8 per cent from 5.2 per cent, in the Northern Territory it stayed at 4.6 per cent and in the ACT it remained at 3.0 per cent.