Unemployment ticks up to 7pc as robust jobs recovery suggests jobless rate has peaked

Victoria’s jobs market roared back to life in October to drive a surprise surge in national employment, with the jobless rate ticking up to 7 per cent.

It’s unclear what level of employment a COVID-safe economy can generate. Picture: Getty Images

Victoria’s jobs market roared back to life in October to drive a surprise surge in national employment, with the jobless rate ticking up to 7 per cent as Australians flooded back into the workforce.

Economists had expected the Victorian employment rebound to be delayed until November, but the country’s second most populous state was the standout performer last month, creating 81,600 jobs in October and accounting for almost half of the 178,800 national rise in employment, according to the Australian Bureau of Statistics.

Total hours worked by Victorians over the month jumped by 5.6 per cent, versus a countrywide increase of 1.2 per cent, the seasonally adjusted data showed.

Nationally, there were 97,000 full-time jobs gained in the month, while part-time employment rose by 81,800. Incredibly, part-time employment has now pushed above pre-COVID levels.

Josh Frydenberg said Thursday’s jobs numbers “confirm that Australia’s economic recovery is gaining momentum”.

The Treasurer acknowledged the road to full recovery from the recession would be “long” and “bumpy”, but that “there is light at the end of the tunnel”.

The strength of the ABS labour force report reinforced expectations that unemployment has likely peaked.

“If you look at these numbers you can have some confidence that the unemployment rate might blip up by 0.1 or 0.2 percentage points, but it doesn’t look likely it will go up by 1 or 2 percentage points,” University of Melbourne professor Jeff Borland said.

The economy has now recovered three in four jobs lost at the height of the recession.