Australia's economy sheds 22,000 full-time jobs in May

Australia's jobs market reversal has continued as it reported weaker-than-expected numbers for the month of May.

The country's economy shed 22,000 full-time jobs, according to figures from the Australian Bureau of Statistics., external

This is the second consecutive month that the economy has seen a decline in full-time employment.

However, the number was offset by an increase of 29,800 in part-time employment, keeping the unemployment rate steady at 4.9%.

"It's a disappointing report, particularly the fall in full-time jobs," said Brian Redican of Macquarie bank.

"Employment has been very lacklustre for a number of months now, and suggests the economy hit a turning point in the first half of 2011," he added.

The weak employment numbers hit the Australian currency.

The Australian dollar fell by as much as 0.8% against the US Dollar after the data was released.

Analysts said investors now considered that, given the weak employment numbers and the recent dip in Australia's economic growth, the Reserve Bank of Australia may not raise interest rates for some time.

"It means that the Australian dollar is not so attractive in terms of the interest rate it can offer foreign investors," said Sean Callow of Westpac Bank.

However, despite the dip, analysts said the fundamentals of Australian economic growth were strong.

"It will be unwise to become bearish on the Australian economy and to bet too heavily against the Australian dollar," Mr Callow said.

"In doing so you are affectively betting against China and India," he added.

Mr Callow said that given the growth in these two countries and the demand for Australia's mining resources, the Australian currency was likely to remain strong.