The latest unemployment data landed on Wednesday, accompanied by a fair amount of crowing from the Government about the success of its economic plan and just as much pooh-poohing of said plan from opposition parties.
While these announcements are the kind of thing politicians live for, we can’t all be politicians, right?
If all the numbers and jargon made your eyes glaze over, you’re not alone.
Here’s what the latest unemployment update really means for you.
* Unemployment in NZ expected to fall to ‘record’ low
* BusinessNZ disappointed over Government stance on migrant labour
* Record jump in jobless rate to 5.3%, but NZ set to avoid unemployment disaster
I saw the stats but I’m confused. What’s the difference between unemployment and underutilisation?
Finance Minister Grant Robertson faces questions about near-record-low unemployment, falling house prices and mortgage rate concerns.
The unemployment rate refers to people who don’t have a job but are available for and actively seeking employment – the unemployed.
In the three months to the end of September, the unemployment rate was 3.3%, unchanged from the three months prior.
Underutilisation casts a wider net. It counts the unemployed as well as those who:
- are employed part-time but want more work – the underemployed;
- want a job and are available to work but not actively looking – potential jobseekers;
- are unavailable to start work but looking for a job as they will be able to start within the next month – unavailable jobseekers.
Because it looks at a larger group, the underutilisation rate will always be higher than the unemployment rate – the figure released on Wednesday was 9%, down slightly from 9.2%.
The official unemployment rate is based on a survey by Stats NZ. To count, people must have actively looked for work in the previous four weeks.
OK, what else do I need to know about this update?
The news is pretty good if you’re a worker.
Wages are still rising so we’re earning more. Average hourly earnings (excluding overtime etc) were up to $37.68, a 7.4% increase on the same time last year and slightly ahead of inflation, currently 7.2%.
We’re also working more hours as more of us take on full-time work, with Stats NZ reporting an increase in both total usual hours and total actual hours worked.
The combination of higher wages and more hours worked helped lift average weekly earnings for full-time employees to $1476, a 7.9% increase.
And if you’re not a worker? Is there a catch for businesses?
With such a large chunk of the population already in employment, businesses are struggling to fill remaining vacancies.
The mass exodus of backpackers and other migrant workers at the peak of the pandemic left a gaping hole in our workforce, and we’re yet to reverse the trend.
In the 12 months to June, there were 49,200 migrant arrivals and 60,700 migrant departures, a net loss of 11,500 people, according to Stats NZ.
It was the 16th month in a row that the data showed a net migration loss and, because most migrants are working age, that’s putting the squeeze on employers.
On Wednesday Mike Horne, chief executive of Fullers 360, said the ferry service was running with about 75% of its usual workforce.
That meant some services, including the Auckland to Coromandel route, had to be suspended and every route the company operated had been affected in some way, he said.
Bus services have also been impacted by the lack of available drivers, with Transport Minister Michael Wood recently saying there were about 800 driver vacancies nationwide.
That doesn’t sound like an easy fix. What’s going to be done about it?
The Government is throwing $61 million into an attempt to keep the wheels on the buses going round.
On a wider scale, it’s also investing in skills and training, and efforts to lure overseas talent back into the country.
Overall, Finance Minister and Deputy Prime Minister Grant Robertson said Wednesday’s results were “a very positive outcome”.
“Unemployment is low, more people than ever are in work and wages are growing faster than inflation to help them meet cost of living pressures,” he said.
Robertson said that showed the Government’s economic plan was working.
“Our focus is on keeping the economy moving in the right direction. Our job is far from over, but we’re making progress.”
But he would say that, wouldn’t he? What does the other side make of it?
If you ask National leader Christopher Luxon, the Government still hasn’t offered a solid plan to negotiate the tricky economic waters New Zealand, like many other countries, currently finds itself in.
“Prices have now risen faster than wages for nine quarters in a row. Food, rent, petrol, and mortgage repayments have all skyrocketed on the Government’s watch,” he said.
“After more than two years of Kiwis going backwards, the Government still hasn’t presented a real economic plan.”
ACT Party leader David Seymour said unemployment figures, however rosy, became a moot point when there were still many jobs to be filled.
“The problem is New Zealand is missing around 140,000 people right now. Pre-Covid, net migration was 60,000-plus people each year, even reaching 80,000 in the year to March 2020,” he said.
“Post-Covid, New Zealand is losing a net 10,000 migrants a year. Instead of gaining around 120,000 migrants in the past two years, New Zealand has lost 20,000.”