Newcastle's unemployment rate has fallen to a record low as employers struggle to find staff.
The Australian Bureau of Statistics (ABS) estimates the Newcastle and Lake Macquarie jobless rate dropped to just 1.7 per cent in May, down from 2.5 per cent in April.
It is the lowest monthly rate since the ABS started keeping statistics in 1998 and only the second time the figure has dipped below 2 per cent.
The May jobless rate in the rest of the Hunter was up from 4.1 per cent to 5.1 per cent.
The ABS monthly estimates can be volatile due to small sample sizes, but the more reliable Newcastle and Lake Macquarie yearly average is still well below the state and national rates at 2.9 per cent.
The NSW and Australian unemployment rates were 3.7 per cent in May, down from 4 per cent in April.
Business Hunter chief executive officer Bob Hawes said the "remarkable" labour market in parts of the Hunter was "part of a trend and not an aberration".
The ABS labour force survey estimated that the regional workforce remained high at 370,000, though the Hunter had lost 10,400 roles across the month, most of them outside Newcastle.
"The low unemployment rates continue to be skewed by a sagging participation rate, which masks a loss of positions across the month against a low unemployment rate," Mr Hawes said.
"The drop in the monthly participation rate in Newcastle and Lake Macquarie represents 11,300 people, which is again remarkable given the current economic circumstances."
The pool of unemployed people remained static at about 12,000.
"These figures still speak to a tight job market across the region," Mr Hawes said.
"Businesses are continuing to feel the pain of not being able to fill vacant positions.
"We know the same goes for those trying to find employment.
"We have an employment stalemate in some sectors and areas."
The Jobs and Skills Australia Internet Vacancy Index for May remained virtually unchanged at 5800 jobs advertised online in the Hunter.
"Despite the loss of some roles in May, we're still seeing circumstances where businesses are looking for people and clearly having trouble placing the right candidate," Mr Hawes said.
"Some in the community have simply withdrawn from the market, which helps explain why the pool of unemployed people hasn't exploded."
