Stats NZ changes definition of unemployed

Stuff reports:

With the stroke of a pen, the number of people unemployed dropped by 12,000, while the number in the workforce has also dropped.

But the changes are purely statistical, with not a single job being created or lost in the changes. 

On Wednesday Statistics New Zealand released a report outlining revisions to labour market research, designed to better identify job seekers and to bring the official figures in line with international standards.

It is the first major change to the calculations since the household labour force survey was introduced in 1985.

As a result of the changes, there have been substantial revisions to household labour force estimates, dating all the way back to 2007, to give accurate comparisons to future reports.

According to the new reports, the unemployment rate was 5.2 per cent in the March 2016, compared to 5.7 per cent in the original report, with the number considered unemployed dropping by 12,000 to 132,000.

Meanwhile the labour force participation rate dropped by 0.3 percentage points to 68.7 per cent.

The figures have been recalculated for every quarterly household labour force survey back to the start 2005.

This will get conspiracies going that the Government has changed the definition to make the data look better, but Stats NZ decides this independently, and it is about having the same definition as other countries.

The change is pretty simple to understand. You are only regarded as unemployed if you are out of work and actually seeking a job. And previously if you indicated you browsed job advertisements on the Internet, you are deemed to be seeking work.

The new definition regards merely reading advertisements, but not actually applying for any jobs, as not seeking work and hence not in the labour force.

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