04 November 2015

NZ employment update: First fall in three years

Yesterday the most recent quarterly update for employment in New Zealand was released (Statistics New Zealand publishes labour market data quarterly, whereas the Australian Bureau of Statistics publishes the equivalent data monthly).
The result was the first backward step in the New Zealand labour market in three years.

Category
Sept 2015 (000s)
3 month change (%)
12 month change
(%)
NZ
AUS
NZ
AUS
NZ
AUS
Employed persons
2,347
11,769
-0.4
0
+1.5
+2.0
Unemployed persons
151
772.5
+2.0
+0.02
+10.5
+2.1
Percentage points
Employment rate
64.5%
60.9%
-0.7
0
-0.5
+0.2
Unemployment rate
6.0%
6.2%
+0.1
+0.2
+0.4
+0.1
Participation rate
68.6%
64.9%
-0.7
+0.1
-0.2
+0.4
Average hourly earnings
$29.29
=
$AUD
$27.05
$35.61*
=
$NZD
$38.56
+1.0%
NA
+2.3%
NA

* this hourly rate is based on May 2015 data as November 2015 data is not released until 25 February 2016
Other key data from the Statistics New Zealand release was:
  • 151,000 was the highest number of unemployed people since the June 2013 quarter
  • Male unemployment was 5.6%. Female unemployment was 6.5%
  • Construction was the largest contributor to net employment growth over the past 12 months. Auckland (14,700) and Canterbury (5,000) were the largest two regions of growth in Construction employment
  • Auckland’s annual employment growth fell after a particularly strong period of growth over the past two years. For the year to September, growth slowed to 1.5%, down from 3.9% for the year to June 2015. Outside of the construction industry retail trade, accommodation and food service industry (8,400) and health care and social assistance industry (7,600) were the largest growth industries. Net declines in employment were recorded in the financial and insurance services, manufacturing and wholesale trade industries.
  • Of all regions, Bay of Plenty had the highest and only statistically significant annual employment growth: 6.1% (8,100 people)
This relatively downbeat news for the New Zealand labour market has come after a very strong period of growth that has seen the Australian labour market lag behind our Kiwi cousins.

Certainly the RIB 2014/15 annual review would suggest that the New Zealand recruitment agency market has had a cracking past (Australian) financial year with 12 of the 17 New Zealand-based RIB participants reporting their highest profit on record (71% compared to the RIB average of 27%).

The very strong financial results for both the June 2015 and September 2015 quarters would suggest that the Australian recruitment industry might just be in the process of catching up on the exceptional growth that has been enjoyed across the Tasman in the past couple of years.

The ABS will release the Australian October 2015 labour market update on Thursday next week (12 November); it will be very interesting to see what the data shows.

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2 comments:

  1. Ross. Good to see you taking such a keen interest in our NZ labour market. Some other things to note are the higher NZ than Aus participation rate (68.6% vs 64.9%) and employment rate (64.5% vs 60.9%). Employment numbers have fallen marginally in 3 months, partly through cutbacks in dairy and other exports, although increasing year on year. But with high net annual immigration over the past 2-3 years the pool of available workers in NZ is now expanding faster than net job creation. In a report published by MOTU research this week, evidence was produced that the average skill levels of NZ workers decreased during the economic growth period up to 2007/8, and then increased up to 2011/12.

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    Replies
    1. Thanks for your comments, Michael. On almost all fronts the NZ labour market does an extraordinary job, as I have often written about. Something about resourceful people in a small nation!

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