The official unemployment rate has once again risen on the back of more people looking for work – rising from 7.4 per cent in June to 7.5 per cent in July.

The marginal increase was lower than expected but nonetheless took the official number of unemployed Australians to 1,009,400 people – the first time there has ever been more than one million people out of work, available to work and actively looking for work.

Meanwhile, full-time employment rose by 43,500 people over the month and part-time employment increased by 71,200 people, according to the Australian Bureau of Statistics.

As a result, the number of employed Australians rose by 114,700 people, which was better than expected.

ANZ bank had predicted the unemployment rate to jump to 7.7 per cent and employment to rise by 60,000 people, while Commonwealth Bank had tipped unemployment to reach 7.9 per cent and employment to increase by 50,000 people.

But the large rise in jobs didn’t translate into a lower unemployment rate, as the number of people counted in the labour force also increased.

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This is because more people started actively looking for work – with the participation rate consequently increasing 0.6 percentage points to 64.7 per cent.

And economists said the data didn’t capture the full effects of Melbourne’s tougher lockdown, either.

“The reality is that the reimposition of stage 3 restrictions on businesses and households in Victoria in early July would have resulted in a new round of job losses,” CBA head of Australian economics Gareth Aird said before the figures were released.

“But the timing of the survey and also issues around how the ABS classifies people mean that people stood down in early July will be considered employed in July.

“As we have flagged previously, the ABS classifies a person as employed if they were stood down but had been paid for some part of the previous four weeks.

“This means there can be a lag from when somebody loses a job to when they are no longer considered employed.”

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The survey’s reference weeks are between 28 June and 11 July, which means that anyone stood down after Melbourne re-entered Stage 3 restrictions on July 8 is likely to be counted as employed in this release.

Separate analysis by ANZ bank predicts 90,000 workers will lose their jobs by the end of September as a result of the move to Stage 4 restrictions on August 5 – and the Reserve Bank and Treasury both predict unemployment will reach 10 per cent before the end of the year.

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But there was some good news buried in the ABS release.

The underemployment rate – which measures the number of people who would like to work more hours than they currently are – decreased by 0.5 percentage points to 11.2 per cent, and the number of hours worked across the economy rose by 1.3 per cent.

EY chief economist Jo Masters said the easing of restrictions in most parts of the country was helping people get back to work.

“However, it’s important to remember that this is improvement after a devastating blow and there are now 1 million Australians without a job. Looking forward, conditions in the labour market are set to remain challenging,” she added.

The data also shows that female employment and hours worked have risen by more than male employment over the last two months – helping to reverse the gendered impact of the first wave of lockdowns.