Employers remain cautious but fewer plan to cut staff amid an improvement in business confidence from recent lows, according to a quarterly survey today.
Employer sentiment improved by 0.2 percentage points to a net 19.8% of employers planning to increase permanent staff numbers for the three months ended June, according to recruitment agency Hudson.
Sentiment has improved by more than 31 percentage points from a historic low in March 2009. The official unemployment rate has risen to 7.3%, its highest in more than a decade, but may have peaked earlier than expected, according to Treasury forecasts.
"Employers are holding their line this quarter, which is a pleasing sign of stability for the slowly emerging economic recovery," said Hudson NZ general manager Marc Burrage.
"Business confidence has remained upbeat throughout the first few months of 2010 and the recent results for GDP in the December quarter of 2009 show the economy is growing, albeit at a slower pace than previous recoveries."
The proportion of employers looking to cut staff fell to 7.8%, from 8.2% in the previous quarter.
Those planning no change rose slightly to 64.7%, while the proportion looking to increase permanent staff levels was little changed at 27.6%.
All industries reported positive sentiment for the third consecutive quarter.
Telecommunications employers had the highest levels of optimism overall, with a net 39% indicating an intention to hire permanent staff in the next three months. Industry confidence may be due to the central government's commitment to broadband, recently reaffirmed in the national infrastructure plan, Mr Burrage said.
Employers in construction/property and engineering had the largest rise in confidence, up 17.1 percentage points to a net 32.4% planning to hire permanent staff.
Government sector employers remained cautious about hiring staff, due to headcount caps within departments.
The report was based on interviews with 1158 employers.