Employers still only tentatively optimistic – survey

Employers are still cautious about increasing staff numbers although there has been a lift in hiring optimism in the third quarter of this fianncial year, a survey shows. 

The Hudson report: Employment trends for the third quarter of 2014 shows signs of improvement in hiring intentions for the first time in years.

The report shows a reverse in the downward trends of the previous two quarters with positive hiring intentions rising 4.5 points to 31.8%.  

Christchurch rebuild-related activity dominated the report, showing the South Island hiring intentions are the strongest across the county with positive hiring intentions rebounding 9.5 points to 48.2% in this quarter.

This comes off the back of a 10.3-drop in the second quarter this year.

Hudson New Zealand's Roman Rogers says new spending in Canterbury will help stimulate employment.

“We saw Canterbury stop to take a breath last quarter and recalibrate hiring requirements to meet the needs of the next phase on the rebuild.

“Future hiring intentions will be further supported by $15 billion of new spending earmarked by the Government in Budget 2014.”

The Upper North Island economy also shows signs of employment growth. Almost one-third (30.3%) of employers plan to increase headcount, up 5.5 points.

“The key economy for New Zealand is the Auckland economy as businesses become increasingly more confident and as consumers start feeling safer and start spending more, that should flow through to an even greater lift in business confidence,” says Mr Rogers.

Business NZ chief execiutive Phil O’Reilly says he expects hiring intentions to increase further given a time lag between real economic activity and business decisions.

“What we’re seeing as the economy is built up is [employers] take on part time workers to full time.

“Employers have utilised all their existing staff; now they’re saying “the recovery is on, it’s got some consistency to it, I’m feeling confident about that, so now we’re going to start hiring.”

Despite strong business confidence, there continues to be a lag in New Zealand employers aggressively growing their headcount to capitalise on favourable market conditions.

The report suggests employers are continuing to exercise caution when it comes to investing in people to support future growth.

“Despite the strong economic outlook, we’re seeing employers across the board continuing to exercise caution, not wanting to count their chickens before they hatch, when it comes to investing to support their growth ambitions,” says Mr Rogers.

A strong focus on cost management continues to be a feature among New Zealand employers and 57.8% expect to keep their staffing levels steady this quarter.

Jason Walls is an AUT journalism student