Stats NZ reports:
The unemployment rate increased to 6.0 percent in the September 2015 quarter (up from 5.9 percent), Statistics New Zealand said today. At the same time, 11,000 fewer people were employed than in the June quarter. This was the first quarterly fall in employment in three years.
That is a concern. One needs measures to increase business confidence, to get more jobs created.
- The HLFS highlighted a sharp weakening in labour demand in Q3, with employment falling for the first time in three years (-0.4% q/q).
- While this sounds alarming at first blush, we note that other indicators were not quite as soft. Hours-based measures rose, as did alternative QES employment figures. Additionally, the HLFS weakness was entirely due to part-timers, with full-time employment actually rising a touch.
- Labour supply is also now responding to this softer labour demand environment. A 0.7%pt fall in the participation rate ensured that the labour force contracted for the first time in three years, and ensured the rise in the unemployment rate (0.1%pt to 6.0%) was only modest.
- The tone of today’s figures is soft, but not as soft as suggested by HLFS employment numbers alone. With some more timely measures of employment now improving (hiring intentions and job ads) we are cautious about overplaying the weakness.