Tough year for jobs, but hope on horizon Picture: Campbell Scott Source: The Courier-Mail JOBLESS numbers are tipped to go close to 700,000 by the end of the year, with another 50,000 Australians joining the unemployment line despite a rebound in business confidence, a key private sector survey warns. The surge in confidence suggested by the National Australia Bank survey is the biggest monthly rise since the 9/11 terror attacks, as the increasingly positive global outlook spills over into Australia. But report warns the outlook for the next six months remains weak, with growth slowing, as companies cut their spending plans and unemployment rises. The only upside for households and consumers is the possibility of interest rates dropping to a record low of 2.25 per cent, with an additional three rate cuts penciled in for 2013. The NAB survey, released yesterday, shows the recent run of Reserve Bank interest rate cuts and upbeat developments in the US and China lifted business confidence in December. But the survey warns unemployment may rise from its current level of 5.4 per cent to a peak of close to 6 per cent next year as the mining boom transitions from the construction to export phase. NAB chief economist Alan Oster said the outlook is gloomy for most of 2013 and there are major concerns about big parts of the domestic economy. "The economy is getting softer and the forward indicators are showing a sick sector with most of the positive news coming from the pick-up in global sentiment," he said. NAB is tipping the RBA will lower interest rates by 75 points this year as economic growth drops below its long-term trend level to 2 per cent this year before picking up in 2014. Mr Oster admitted it is a "line-ball call" whether the central bank will cut in February or March, but further reductions in May and August as unemployment rises are expected to take the official cash rate to a record low of 2.25 per cent. The RBA has cut rates by 1.75 per cent to a low of 3 per cent since this cycle began in November 2011. CommSec economist Savanth Sebastian said the patchy and uncertain nature of the outlook means most business will retain a conservative approach to debt and forward planning. The NAB business survey shows confidence rose 12 points in December to an index reading of plus three. But it is still below its long-run average index reading of plus five and NAB cautioned the December result may be reversed in coming months. The result came after the business confidence index fell to minus nine, its lowest level since April 2009, in November. The survey shows conditions were weakest in wholesale, manufacturing, retail and construction with improvements in transport and utilities and recreation and personal services. Confidence was strongest in Western Australia, Queensland and New South Wales and in the transport and utilities and finance sectors.