Job market improves, especially for councils and Canterbury builders

The job market continues to improve – particularly if you work for a council or a Canterbury building firm.

Pay rates and numbers in work rose in the June quarter, according to Statistics New Zealand data released today.

Private sector pay rates rose 2.1% for the year to June, while government sector pay rates increased 1.6%. This follows almost a decade, to 2009, when public sector pay rates outstripped private sector increases almost every quarter.

However, below the headline data released today lie some key differences.

One is that local government pay increased 2.4%, well above the national average of 2%, and coming at a time which followed much government rhetoric about the need to contain the extra costs imposed by high-spending local authorities.

Reserve Bank governor Alan Bollard has also often criticised the extent to which local government costs are adding to price inflation.

Today's data indicates that while the government has had some success in containing wage pressures in the central government sector, there is yet to be similar restraint by local government.

The other factor in today's figures are that, for the first time, Statistics NZ has separated out Canterbury wage and salary cost increases.

This is so any pressure on wages, driven by skills shortages as the Canterbury rebuilding gets under way, can be isolated.

Today's data shows wage and salary rates in Canterbury construction sector rose 3.1% for the year to June, down from the previous 12 months' 4.3% but still well above the national average.

The labour costs index measures changes in pay for a fixed amount of labour input.

Meanwhile, quarterly employment figures, also released today, show the number of filled jobs rising 1.9% for the year to june, while average ordinary time hourly earnings rose 2.9% for the year.

There was a 1.5% rise in full time employment in the June quarter, while weekly paid hours rose 2.1% over the period – the biggest quarterly rise since June 1997.

In Canterbury, the number of filled jobs rose 0.5% for the year, the first annual rise since the first earthquake in September 2010.