The unemployment rate unexpectedly tumbled to 5.8 per cent in February as a further 88,700 people joined the workforce in the month.

Economists had expected a more modest 30,000 increase in employment in February, with the jobless rate easing to 6.3 per cent from an originally reported 6.4 per cent in January.

However, the January rate was revised down to 6.3 per cent.

“The strong employment growth this month saw employment rise above 13 million people and was 4000 people higher than March 2020,” Australian Bureau of Statistics head of labour statistics Bjorn Jarvis said.

Treasurer Josh Frydenberg had pledged that the federal government would begin budget repair once the unemployment rate was comfortably below 6 per cent.

However, he said on Thursday “5.8 per cent is not comfortably below 6 per cent”.

“The other point I would make is that the unemployment rate in February of last year was 5.1 per cent,” Mr Frydenberg said.

But he conceded the outlook was bumpy and challenging when the JobKeeper wage subsidy ended on March 28.

The good jobs news is unlikely to keep coming, with JobKeeper due to end within days.

JP Morgan economist Tom Kennedy agreed the end of JobKeeper, and changes to JobSeeker dole payment, presented hurdles to the outlook.

“We anticipate the end of JobKeeper will see the pace of employment growth slow, and potentially partly reverse,” he said.

However, Prime Minister Scott Morrison was upbeat about the monthly figures.

“In less than 12 months from when the recession began, caused by the COVID-19 pandemic, there are now more jobs in the Australian economy than there were before the pandemic,” he said in Canberra.

“That is something that is truly remarkable.”

A report warns the good fortunes retailers enjoyed coming out of the 2020 recession may not last as government stimulus measures are wound back.

Retail spending was one of the bright spots of the economy in the second half of 2020, and the buoyancy could spill over into the early stages of this year.

But Deloitte Access Economics said a return to more normal spending could mean 2020’s windfalls were temporary.

Retail spending ended 2020 on a strong note, with volumes surging 6.4 per cent over the year to December quarter.

But Deloitte expects spending will slow during the second half to be down 0.4 per cent for 2021.

“Our fiscal stimulus tap has been turned down to a drip, meaning less money for households to spend,” Deloitte Access Economics partner David Rumbens said.

He said while households were expected to spend up given the good news on virus vaccines and fewer restrictions, it was more likely to be on travel and hospitality.

-with AAP