Between the start of this century and the end of 2008, employment in New Zealand, as measured by the Household Labour Force Survey (HLFS), was trending upwards more-or-less steadily.
2013 there has been a major bounce-back to increase employed by over 105,000 compared with the previous year when there was a net loss of 32,000 employed.
We started the second half of 2013 with the economy appearing to have some momentum behind it. Since then however, consumer and business confidence has dipped a little. Nevertheless, overall conditions remain positive. Despite these positive noises, the labour market conditions remain somewhat erratic and September quarter labour market results, released on 6 November, are unlikely to be as positive as many are hoping.
The unemployment in December quarter was 160,000, which is 10,000 less than it was in September quarter. The reason it dropped is because the number who gave up looking for a job increased by 21,000 people.
In fact the HLFS (Household Labour Force Survey) employment numbers are not erratic at all. The annual increase in the volume of work in the economy each quarter has been tracking down since June quarter 2011, and the September quarter figures continued that trend.
The simple answer is that in September quarter there was an increase in the unemployed on the number in June quarter 2012 because the economy created too few jobs.
Despite our forecast being almost spot on, it gives us not pleasure whatsoever to see the official unemployment rate rise to 7.3%. Actual official unemployment totalled 170,000 in September, up from 151,200 this time last year.
Employment growth continues to fall. It dropped from 43,000 a year ago to just 12,000 in the 12 months to June 2012. That 12,000 increase is nowhere near enough to employ the increase in the number of people who want to work. Even this meagre employment increase could well become negative in the next six months if the trend over the last year continues.
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Media Release: EMBARGO 10.30am Wednesday 14 December 2011