The Australian Bureau of Statistics reported on Thursday the 0.2 percentage point rise over the month, with a participation rate of 66.1 per cent, seasonally adjusted.

There was an increase of 46,200 people in full-time employment and a decrease of 32,700 people in part-time jobs - a net boost of 13,500.

The bushfires and coronavirus had a major impact over the month.

Over the 12 months to January, full-time jobs rose by 143,900, while part-time employment increased by 103,500 people.

The largest increases in employment were recorded in Western Australia (up 6700), Victoria (up 2900) and Queensland (up 2800), while the largest drop was in New South Wales (down 1500).

However, the jobless rate increased by 0.6 in Queensland (6.3 per cent) and 0.4 in both Victoria (5.4 per cent) and Tasmania (5.9 per cent).

South Australia saw a 0.5 percentage point dip in unemployment to 5.7 per cent.

The underemployment rate increased 0.3 percentage points to 8.6 per cent.

Employment Minister Michaelia Cash said the full-time job figure and lift in participation were welcome.

"Australians are out there, they are putting up their hand and they are saying they have confidence in the jobs market," Senator Cash said.

Labor spokesman Brendan O'Connor said the economy had been weak before the bushfires, coronavirus and the Holden closure.

"The underemployment rate at 8.6 per cent and the underutilisation rate at 13.9 per cent for the month of January is far too high," he said.

"Serious structural issues in the labour market continue to generate insecure work and low wages growth."

Economists are predicting further increases in the unemployment rate and a subsequent interest rate cut in coming months.

"Along with yesterday's meagre wage growth print, these data show that there is still plenty of spare capacity in the labour market," BIS Oxford Economics senior economist Sean Langcake said.

He expects jobs growth to lose momentum over 2020 and slow to less than two per cent.

"This will make it challenging to work through existing spare capacity, and we expect the RBA will cut rates in the first half of the year to aid this transition," he said.

Capital Economics' Ben Udy said the January data alone probably wouldn't convince the Reserve Bank a cut was necessary, but he too predicted unemployment would continue to rise.

"If we are right, we think that will be enough to convince the RBA to cut rates by 25 basis points in April and July," he said.

Greens leader Adam Bandt said Australia faced a jobs crisis.

"We're going to start seeing businesses going to the wall (from climate change) and we're going to start seeing people, especially young people, never enjoying a secure job in their life unless we come up with a plan to tackle these crises," he told Sky News.

Australian Associated Press