Unemployment rate reaches 5 percent in flood-hit Australia

But while more than 10,000 jobs were lost, the slowdown in employment recorded by the Australian Bureau of Statistics was not as severe as expected as economists had predicted the number of jobless people to rise by 20,000.

“Continued low unemployment confirms again the underlying strength of the Australian economy,” Australian Employment Minister Chris Evans said in a statement.

“Our economy is resilient and today's figures provide confidence about the nation's robust employment outlook.”

Full-time employment exceeded predictions with an increase of 47,600 jobs to 8.07 million, but the number of people in part-time work fell steeply by 57,700 to 3.34 million, pulling the overall figures lower.

But widespread flooding in the eastern state of Queensland and in southern Victoria in December and January, which caused billions of dollars in damage, dampened jobs growth, with both states posting major falls in full-time jobs.

“(The) figures clearly show the very significant toll the impact that natural disasters over summer have had on the Queensland economy with the number of people employed falling by more than 22,000,” Evans said.

Queensland, a driving force in agricultural and minerals production in Australia, was particularly hard hit by inundations that shut coal mines and ports and swamped the center of the state capital, Brisbane.

Australia's economic growth is expected to be lowered by as much as one percentage point in the first three months of the year as a result of the rolling natural disasters.

The high-yield Australian dollar, which has soared in strength against the U.S. dollar, fell briefly as the latest employment figures were released, but then recovered to US$1.0113 from a low of US$1.0089.

But economists said the fall in employment was a short-term phenomenon and that the job market would remain tight as Australia's resources-driven economy continues to boom.

While the headline figure was weak, the underlying data was very strong, analysts said.

“That big 47,000 full-time jobs is really the more important number ... it's a terrific number really,” St. George Bank senior economist Kate King told the AAP news agency. “It offsets the fall in full-time positions last month.”

The figures demonstrated that Australia's labor market was approaching full capacity as the economy boomed on the back of rising resources prices and massive demand from China and other emerging economic powers, analysts said.

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