Australia's unemployment rate jumped to 7.4 per cent in June, up from 7.1 per cent in May, despite the economy adding 210,800 new jobs as COVID-19 restrictions eased before Victoria's second lockdown.

It was the biggest monthly bounce-back since records were kept, but the unemployment rate is now at its highest since November 1998 because the participation rate – the proportion of working-age people actively looking for jobs – has jumped to 64 per cent from a downwardly revised 62.7 per cent.