Dole at 28 year low

NZPA reports that numbers on the unemployment is at a 28 year low.  This is excellent news.

We’ve basically had falling unemployment continously since 1991, with the exception of around 97-98 and the Asian crisis.

Labour will be and should be pleased with their record over the last eight years.

Of course some of the reduction is because some have gone onto Invalids or Sickness benefits (or DPB) but their increase is definitely smaller than the decrease in the dole.  I suspect also quite a few have gone onto some of the free training courses offered by polytechnics and wananaga.  But that is better than just being on the dole (so long as those training courses do eventually lead to work).

The challenge now is not to be complacent.  It’s great numbers have dropped so much – but there still are too many families which are lifetime benefit dependent – kids growing up with no working role models. Again the numbers of long term beneficiaries have dropped (on the dole anyway – haven’t got other figure to hand), but every family which manages to move from welfare to work (or at least a combination of both) is a success story.

The low unemployment ties into the fact most polls show people think the country is heading in the right vs the wrong direction.  They are not happy with the Government, but they are reasonably happy with the country. We see this with Roy Morgan who has Labour 13% behind National, yet right direction 10% ahead of wrong direction.  This is why the election outcome is far from settled.  Mind you Labour’s suicidal tendencies in the last few weeks mean they may suffer a Howard – losing an election despite overall confidence in the country’s direction.

Roy Morgan has the confidence indicator at 110 (100 plus margin of right over wrong). That’s still positive but down from 121in early October.

If a confidence indicator is negative (such as in the US) then it is very very difficult for an incumbent to get re-elected.  If the confidence indicator is positive, it doesn’t mean the opposition will lose, but it does mean people have to be convinced they can change government without changing the fundamental direction of the country. Kevin Rudd managed that tightrope very well.

So it will pay to watch the confidence indicators over the next few months.  If they dip and stay below 100 it is all over.  If they stay above 100, then you can never write out the incumbents – even if trailing in the party vote.