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Unemployment rate defies expectations

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Thomas Hunter

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Jobless rate remains steady

Chris Zappone reports on the latest unemployment figures as the rate for October is released.

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THE Australian economy added more than 10,000 new jobs in October, helping keep the jobless rate steady and lengthening the odds of another interest rate cut before Christmas.

New data out on Thursday showed that unemployment remained at 5.4 per cent, the same level it reached in September, as the jobs market defied forecasts of a further rise in the unemployment rate.

The economy added 18,700 jobs full-time for the month, well ahead of expectations, but lost 8000 part-time jobs, with a net gain of 10,700 jobs. But the participation rate - the share of the population in work or looking for it - also fell as job seekers gave up looking for work, helping to cap any rise in the official jobless rate. It's the second month in a row that more jobs were created than expected.

Economists surveyed by Bloomberg expected the jobless rate to rise to 5.5 per cent and a net gain of only 500 jobs.

Stephen Walters, chief economist at JPMorgan, described the result as a ''pretty soft outcome''. He said a rise of only 10,000 jobs would typically see unemployment rise, but it didn't as the participation rate dropped.

''We think we'll only get modest jobs growth in the period ahead and that means unemployment has further to rise.''

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