NZ full-time employment rises amid slowing wage growth

Tuesday 2nd February 2010

The number of people in full-time employment grew for the first time in 12 months amid the slowest annual wage growth since 2001, as the impact of the worst recession in 18 years continues to lean on the labour market.

The number of full-time equivalent employees grew 1.4% to 1.31 million people in the three months ended Dec. 31 from the third quarter, though it’s still down 2.5% from the same time a year earlier, according to the Quarterly Employment Survey released by Statistics New Zealand. Salaries and wages grew 1.8% in the 2009 calendar year, according to the Labour Cost Index, the slowest annual pace since June 2001.

“Employment gauges suggest that firms remain hesitant to go out and hire, although Thursday’s HLFS data will be key,” said Philip Borkin, economist at Goldman Sachs JBWere. “Wage growth continues to moderate and we expect it to remain subdued over 2010.”

The Household Labour Force Survey out on Thursday is expected to show unemployment rose to 6.7%, the highest level of joblessness since March 2000, according to a Reuters survey.

Economists have become more optimistic about the outlook for the labour market since New Zealand’s economy dragged itself out of recession last June, and Finance Minister Bill English said in a newsletter that he expects the rate to be as small as 6.5% through this period.

Retailers underpinned the gains in full-time employment through the December quarter, as they prepared for the busy holiday trading period, while part-time jobs were bolstered by administrative and support services.

Seasonally adjusted total paid hours declined 0.3% to 48.94 million with gross earnings up 0.1% to $1.246 billion coming from an increase in paid hours from retailers.

Average total hourly earnings in the private sector shrank 0.4% to $23.48 in the three months through December, while public sector wages rose 0.7% to $32.36 over the same period.

Filled jobs, which surveys all full- and part-time employees along with owner-operators, rose 1.2% to 1.68 million in the quarter, though it’s declined an annual 1.8%.

Businesswire.co.nz

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