Surprise fall in Aust unemployment

Sydney - A surprise fall in the nation's unemployment rate suggests Australia is navigating its way through the global recession in better shape compared to its trading partners, economists say.

Australia's unemployment rate was a seasonally adjusted 5.4 per cent in April, the Australian Bureau of Statistics (ABS) said on Thursday, down 0.3 percentage points from the previous month.

Economists had predicted the ABS data would show a rise in the jobless rate to 5.9 per cent, from 5.7 per cent.

It is the first fall in the monthly unemployment rate since August last year.

During April, total employment rose by 27,300, with full-time employment up by 49,100 but part-time employment falling by 21,800.

Economists had expected total employment to decline by 25,000.

Macquarie Group senior economist Brian Redican said the labour force report, coupled with recent positive local economic data, showed the nation was holding up well in the current global economic downturn.

"It's not just the labour market numbers," said Redican.

"It's yesterday's retail trade numbers, it's the turnaround in housing and building approvals and even the strength in exports up until March.

"It's a pretty consistent story that Australia is actually getting through this (crisis) in much better shape than most people have given it credit for."

ABS figures published on Wednesday showed retail sales rose 2.2 per cent in March.

Redican said while the jobs report was "extraordinarily strong", he described it as a "one-off aberration" and expected to see a further deterioration in the months ahead.

"We've seen no signs of any significant improvement in things like jobs advertisements or job vacancies, and hiring intentions in the business surveys still remain very weak," said Redican.

"I do think we will see further weakness in the next six months."

He also cautioned against reading too much into one month's result, given the volatility of the labour force data series.

"We still have to have a lot of caution about these numbers," Redican said.

The nation's jobless rate was at a 33-year low of 3.9 per cent in February 2008, but rose to 5.7 per cent in March this year - its highest level since October 2003.

The flow of announced job losses continued in April after Qantas Airways Ltd said it would cut 1750 jobs - about five per cent of its workforce - as it battled slumping demand for travel.

In the same month, mining giant Rio Tinto said it would retrench about 700 workers from its Queensland workforce due to lower demand for aluminium. This came on top of the company's previously announced 14,000 global cull of its workforce.

The Australian dollar reacted positively to the figures.

The local currency was trading at US$0.7467 just before the figures were released at 1330 NZT, but rose to an intraday high of US$0.7551 shortly afterward.

- AAP