The Australian Bureau of Statistics' (ABS) latest job figures showed a seasonally adjusted 26,900 created jobs in May, with full-time employments shooting up to 36,400 and part-time works slipping a bit to 9,400.

According to an earlier survey conducted by Bloomberg, economists had forecasted that unemployment would settle to 5.4 percent in May, yet the number of people seeking employment slipped to 65.1 percent while the available jobs increased, thus slicing unemployment to 5.2 percent from the 5.3 percent seen in April.

In the same vein, the more stable trend of unemployment rate improved to 5.2 percent, again coming from 5.3 percent in April, while the number of hours in May totalled to 1.57 billion hours, up by 2.9 percent and increasingly indicating a trend of a strong full-time employment.

Underemployment also fell by 12.2 percent in the same month, as compared to the underutilisation figures from three months ago.

Helen Kevans of JP Morgan told Reuters that the employment gains was a surprise, if not a strong result, as they originally predicted that May would see a job loss of up to 5,000.

She attributed the rise to improvements in full-time employment, adding that "we saw a big rise in the number of hours worked and a significant drop in the unemployment rate so all round a pretty positive report."

For his part, CommSec's Craig James said that working hours is slowly returning to pre-financial crisis levels as "employees are now holding onto and finding new jobs while existing workers have got back the bulk of the hours they lost in the GFC."

He cautioned though that the labour market data is effectively backward looking and "given the recent round of weak economic data, it may just be that jobs growth will be less positive in the coming months."

Ms Kevans added that a sustained employment gains could introduce some worries for the Reserve Bank of Australia (RBA) about wage and inflation pressures, though she believed that the central bank would hold off any rates movements until at least the financial trouble in Europe is in effect.

Absorbing the encouraging news, the Australian dollar climbed to 83.27 US cents by 1140 AEST.