March figures show positive employment market

By Phil Boeyen, ShareChat Business News Editor

Thursday 9th May 2002

There's expected to be further upwards pressure on interest rates following the release of strong household labour force figures for the three months ended March.

Statistics New Zealand reports that higher numbers of people were recorded as employed in the quarter while the number of people out of work has dropped.

The figures show that the seasonally adjusted unemployment rate has fallen to 5.3%, down 0.1% on the previous quarter, while the labour force participation rate has grown to 66.9%.

"This is the highest participation rate recorded since the survey began in the December 1985 quarter," Statistics New Zealand says.

Seasonally adjusted figures show there were 1.435 million people in full-time employment in the March 2002 quarter, up 14,000 or 1% from the previous quarter. On an annual basis, the number of people in full-time employment rose 30,000 or 2.1% for the year ended March.

Seasonally adjusted part-time employment increased by 14,000 or 3.3% to 435,000 in the March quarter and was up 36,000 or 9% on an annual basis.

New Zealand's working age population grew by 16,400 or 0.6% in the March 2002 quarter, which Statistics NZ says can partly be attributed to a net gain in permanent and long-term migration.

Economists said recently that a strong result from the Household Labour Force Survey would put further pressure on the Reserve Bank to raise interest rates at next Wednesday's monetary policy statement. Job ad data is due to be released tomorrow and any improvement there could also add to the interest rate pressure.

Australia's central bank raised its cash rate this week to 4.5% but that is still below New Zealand's rate of 5.25%.

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