Sharechat Logo

NZ jobless rate rises to 5.7% in 1st qtr; Auckland construction jobs drive employment growth

Wednesday 4th May 2016

Text too small?

New Zealand’s jobless rate rose in the first quarter as the nation’s labour force recorded its biggest increase in 12 years and Auckland drove an increase in employment growth.

The unemployment rate rose to 5.7 percent in the first quarter, from a revised 5.4 percent three months earlier, Statistics New Zealand said. The labour force increased by 38,000, or 1.5 percent, the largest increase since December 2004. The participation rate rose to 69 percent from 68.5 percent, while the employment rate edged up to 65.1 percent from 64.9 percent.

While employment is growing, wage inflation as measured by the labour cost index remains subdued, rising at 0.4 percent in the quarter for an annual rate of 1.6 percent. That tallies with the Reserve Bank’s assessment that record migration is not only boosting economic growth but also increasing the labour force, keeping a lid on wage inflation.

“Wage growth is set to remain muted and an area of concern for the RBNZ as it tries to generate added inflation pressure,” economists at ASB Bank said before today’s release. “Ongoing weak wage inflation outturns would highlight the downside risks to the inflation outlook and would likely reduce any current doubts the RBNZ has about cutting the OCR again in June.”

Auckland, the biggest beneficiary of immigration and a city grappling with surging property prices, recorded a 2.9 percent increase in employment and accounted for 49 percent of overall New Zealand employment growth in the 12 months ended March 31, the government statistician said.

Total employment across the country grew by 2 percent, or 47,000 people in the year, although the employment rate is down 0.3 percent from a year ago because of the increase in the working-age population.

The total working age population rose by 0.8 percent in the March quarter to reach 3.69 million, the largest quarterly increase since the series began in 1986.

The New Zealand dollar advanced after the data. It recently traded at 69.35 US cents, from 69.18 cents immediately before the 10:45am release.

The construction industry recorded the biggest gain across sector groups, with a 17,500 increase in the latest year.  Much of the growth was in Auckland where forecast growth is expected to require an estimated 32,000 extra jobs through to the likely peak in 2018.

  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

NZ economy probably grew 0.6% in 1Q but more rate cuts still expected
Local travellers boost guest nights in April on Easter, Anzac holidays
Hisco's departure from ANZ becomes permanent amid personal expenses concerns
NZ services sector activity picks up in May but still tepid
Contact's Barnes to depart
17th June 2019 Morning Report
NZ dollar lower on stronger than expected US retail data
MARKET CLOSE: NZ shares edge higher; US rate uncertainty buoys local blue chips
NZ dollar weakens on global tensions, weak local manufacturing
General Capital (GEN:NZ) releases strong preliminary result

IRG See IRG research reports