Fragile jobs mood turning positive

Wednesday 13th January 2010

New Zealanders are feeling more confident about the current jobs outlook than at any time in the last two years, but job security is still fragile as the economy reaches a turning point out of recession, says Westpac Bank.

Releasing the December quarter Westpac McDermott Miller Employment Confidence Index, senior Westpac economist Donna Purdue said the jobs market "has reached the trough and is beginning to claw its way back".

However, the bank says growth in available workers will outstrip jobs growth till mid-year, and that unemployment will peak soon at 6.7% of the workforce, from 6.5% at present.

The Current Conditions Index turned up for the first time since September 2007, when New Zealand's recession started to take hold, ahead of the global financial crisis in 2008, although at 77.8, the index shows the mood about the immediate future is still pessimistic.

On the other hand, the Expectations Index, which tests views about job conditions in a year's time, remained close to its highest levels seen since 2004, at an index reading of 122. A net 16.6% of respondents said they expect job opportunities to be plentiful this time next year, up from a net 14.4% feeling that way in September.

Wage expectations are also on the rise, with a net 36.2% of those surveyed saying they expect to be earning more in a year's time, up from 34% in September.

Seven of the 11 regions surveyed were positive about jobs growth in a year's time, although declining confidence was recorded in Waikato, Gisborne/Hawke's Bay, Taranaki/Manawatu/Wellington, and Nelson/Marlborough/West Coast.

Private sector workers are also considerably more confident about their job prospects and security than workers employed in the public sector, the survey found.

Businesswire.co.nz

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