The ACT unemployment rate has increased for the fourth consecutive month, despite Chief Minister Andrew Barr insisting the economy had official recovered from federal budget cuts.
According to the Australian Bureau of Statistics, the ACT unemployment rate increased to 4.8 percent on trend in August, the highest rate since November last year.
The ACT participation marginally increased to 70.4 percent, which was more than five percent higher than the national average.
Nationally, the unemployment rate fell to 6.2 percent in August from 6.3 percent in July, as the number of people employed rose more than 17,000.
Mr Barr said the latest figures were not a shock and the ACT economy was still on track to recover from cuts to the public service.
"The increase in the unemployment rate is due in part to the increase in the participation rate as labour market prospects improve – this is a sign of increased confidence in the ACT economy," he said.
"The ACT's unemployment rate is the second lowest of any state or territory in Australian – and is still well below the national rate."
The Northern Territory retained the lowest unemployment rate in Australia at 4.4 percent, which was stable on August figures.
Last week, the ABS found economic activity increased by 3.1 per cent during the June quarter, which came after a 1.8 percent increase in the March quarter.
According to the bureau, the growth was driven by public sector spending that has been credited by business leaders as insulating the economy from federal budget cuts.
ACT Chief Minister Andrew Barr said the data showed the territory was leading the nation when it came to economic growth measured by state final demand.
"Economic growth figures, issued last week, were the strongest of any state or territory, showing the confidence in the territory economy," he said.
"There is a clear contrast between the economic and jobs data currently, and that the territory experienced in the mid to late 1990s, when the territory's unemployment rate rose to almost 8 percent due to the Howard government's cuts."
Canberra Business Chamber chief executive Robyn Hendry agreed the economy had proved resilient in the past few years, despite remaining concerned about rising debt.
"There is other evidence to say this is true, including signs of increasing consumer confidence like retail figures," she said. "Clearly the market is telling us the worst is over."
"Private sector investment is down although it does take a while for those investments to materialise and you are not going to get them coming through immediately.
"The largest increase in seasonally adjusted employment was recorded in Queensland with an additional 11,200 jobs created, followed by NSW with 9200 and Western Australia with 7000.
In Victoria, the seasonally adjusted employment rate fell from 6.4 to 6.1 percent with 6600 people leaving the workforce.
Analysts welcomed Thursday's data, saying that at worst, it showed the labour market was steadying.
NAB senior economist David de Garis said the figures were solid.
"It's been a pretty consistent picture of employment growth over the past few months," he said.
"Monthly employment growth of two per cent is more than respectable when the resources sector and allied industries have been laying off people.
"For the RBA, they can't do anything but leave rates on hold."
with Mark Mulligan