Further signs the recession is continuing to bite – despite being technically over – came in this morning's Household Labour Force Survey.The results show unemployment hitting 7.3% of the workforce. That is much worse than economists were expe
Further signs the recession is continuing to bite – despite being technically over – came in this morning’s Household Labour Force Survey.
The results show unemployment hitting 7.3% of the workforce. That is much worse than economists were expecting – the average forecast was for a rise to 6.8% of the workforce.
The unemployment rate is now at its highest level since the June 1999 quarter.
In terms of numbers of people, today’s figure represents 168,000 unemployed.
The figure is also slightly under what the Reserve Bank was anticipating.
The implications are, firstly, that Overnight Index Swap (OIS) markets which have priced in an official cash rate rise by the Reserve Bank before the middle of the year are likely to be disappointed.
The figure also means those positive “hiring intentions” reflected in recent business mood surveys should be taken with a grain of salt.
Part of the increase in unemployment is due to an increase in the numbers joining the workforce, Statistics New Zealand said in releasing the figures.
Partly this is reflected in the numbers of unemployed aged between 15-24: 18.4% of people in that age group do not have jobs. The other factor was a rise in migration over the past quarter.
When the figures are looked at on an annual basis, the parts of the economy which have suffered the worst of the recession become clear.
Manufacturing, retail and accommodation are the main sectors hit. The annual slump in jobs in manufacturing is a whopping 28,000: retail and accommodation the almost-as-bad 24,800.
The only employment group to show an increase in employees are public sector ones: healthcare and social assistance jobs increased by 15,000.
Regionally, Auckland and Canterbury ware the worst hit, with job losses of 16,900 and 12,800 respectively.
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