South Korea's jobless rate remained unchanged in July from a month earlier but job creation slightly quickened, raising hopes that labor market conditions are improving, a government report showed Wednesday.

According to the report by Statistics Korea, the jobless rate stood at 3.1 percent last month. The jobless rate adjusted for inflation also stayed unchanged at 3.2 percent over the cited period.

The pace of job creation quickened. The number of employed people was 25.47 million in July, up 367,000 from a year earlier, which was faster than June when on-year job creation came to 360,000, the report showed.

The July job creation figure marked the largest increase since October last year when 396,000 jobs were added to the economy.

The health and social welfare service sector gained 164,000 jobs and the manufacturing sector added 53,000 jobs.

The lodging and dining sector also added 63,000 positions and the transportation industry gained 36,000 more jobs compared with a year earlier, the report showed.

However, the number of people out of work -- those who tried to find employment but failed to do so -- increased 33,000, or 4.1 percent, on-year to 828,000. It was also up from 813,000 in the previous month.

The report showed that the employment rate also declined slightly to 60.4 percent last month from 60.5 percent in June. The Park Geun-hye government is pushing to raise the employment rate to 70 percent during its five-year term.

Job market conditions worsened for many younger people in July.

The report showed that the jobless rate for those aged 15-29 rose to 8.3 percent last month from 7.9 percent in June. It is also quite higher than the 7.3 percent tallied in the same month last year, according to the report.

The latest job data comes amid concerns that the country's economy might be falling into a prolonged low growth phase as uncertainty persists at home and abroad.

South Korea's gross domestic product grew less than 1 percent on-quarter for the eighth straight quarter until the first quarter.

The economy grew 1.1 percent in the second quarter of this year from three months earlier.

The government is pushing to stimulate the slowing economic recovery by expanding fiscal spending and front-loading its budget.

In May, the National Assembly endorsed a 17.3 trillion won ($15.5 billion) extra budget weeks after the government drafted the proposal to jump-start Asia's fourth-largest economy. (Yonhap News)