Jobs market in robust shape

Yes, the unemployment rate crept up another notch last month, but the number of people employed actually remains near its record high.

And while today's unemployment rate of 5.8 per cent is making headlines as the highest in five years, it's still lower than at any time in the quarter century before 2003.

For all the understandable concern about rising unemployment, we're still part of a remarkable period of high employment and low unemployment within the context of the past three decades.

From the record peak of 10,805,200 last November, we've only lost 32,700 jobs - just 0.3 per cent. Compared with June last year, employment is down 10,200 - 0.1 per cent. It's only in this latest month that the number of jobs has dipped below what it was 12 months before.

From the perspective of businesses considering the number of potential customers in the economy, these remain remarkably healthy times.

The catch of course is that the threat of rising unemployment dents consumer confidence, leading customers to leave their wallets and purses closed, even when they have increased disposable income. The casualisation of the workforce, with a rising proportion of part-time jobs also hurts.

Yet the trend series graph over the past decade basically slows the number of jobs plateauing over the past year after an incredible decade that saw employment grow by 2 million - 23 per cent.

The Reserve Bank on Tuesday told us that the economy's "capacity utilisation'' was about average.

In other words, the current unemployment rate is a long way from slit-your-wrists stuff, but business has become spoiled after such a long golden run of employment growth producing ever-growing ranks of cashed-up consumers.

The bad news was the RBA noting that capacity utilisation will decline over the rest of the year, meaning unemployment will continue to rise.