The unemployment rate has held steady, but experts are divided on whether a rate hike in August can be taken off the table.
Just over 76,000 people found work in June, according to the latest data released by the Australian Bureau of Statistics, but the unemployment rate has held steady at 4.4 per cent thanks to an additional 13,000 people looking for work.
Those numbers add up to a 0.3 per cent increase in the participation rate - or the number of people in Australia over the age of 15 who are either employed or looking for work - bringing it up to 67 per cent of the population, the highest it has been in a year.
Higher participation in the labour force could be the result of people looking for more income due to cost of living pressures, NAB chief economist Sally Auld said.
"It's not always easy to put all the pieces of the puzzle together, but that might be one possible explanation," she said.
The figures were released ahead of next week's update to the Consumer Price Index, which Ms Auld predicted would come in lower than the bank had forecast.
That, combined with June's unemployment rate coming in 0.2 per cent higher than the Reserve Bank (RBA) had expected, could be a reason to keep the cash rate on hold at its next meeting in August, Ms Auld said.
"When you put those two things together - slightly lower on inflation, slightly higher on the unemployment rate - that's a good reason not to hike and to hold fast for another six weeks and just see what happens," she said.
The prediction should come as some relief to home owners, who were hit with three consecutive rate rises in the first half of the year, before it was held at the last board meeting in June.
However, AMP economist My Bui said even if next week's Consumer Price Index (CPI) numbers come back lower than expected, the RBA would need to raise the cash rate by another 25 basis points to disrupt ongoing inflation.
Ms Bui said jobs growth was averaging about 25,000 each month, higher than needed to keep the unemployment rate unchanged.
That leaves just the second half of the RBA's dual mandate - inflation - to worry about, Ms Bui said.
Much would depend on change to the CPI, but she predicted inflation would not come back to the 2.5 per cent target for at least another 18 months.
"Trimmed mean inflation has been above 3 per cent for more than four years. That's a pretty staggering statistic," she said.
"We're quite worried about the fact that inflation expectations can get out of hand, and it's quite hard to get it back to target if we keep letting inflation be that high."
RBA governor, Michele Bullock, was careful to keep hopes for a rate reduction low after it was held at the last meeting of the board in June.
