The job market may be showing signs of life, but the road to recovery is a long and winding one. Here's a breakdown of the latest data and what it means for New Zealand's economy.
The Good News: Green Shoots?
After almost two years of decline, the number of hours worked increased in the September quarter, a promising sign for the job market. This could indicate that employers are starting to bring back part-time workers and manage costs by reducing hours, a strategy that could help businesses scale up quickly when demand returns.
The Numbers Speak
- 160,000 people are looking for work, with almost 15% searching for over a year.
- Wage growth is barely keeping up with inflation.
- The unemployment rate is high, with the total number of unemployed reaching the highest level since 1994.
The Experts Weigh In
Economists like Miles Workman and Bevan Graham see this as a positive sign, suggesting the labor market is turning a corner and that the unemployment rate will slowly decline. Nick Brunsdon agrees, citing other data that shows improvement in job advertisements and employment indicators.
But Wait, There's a Catch
Westpac economist Michael Gordon warns that the hours worked measure can be volatile and isn't a great indicator of GDP. He points out that the number of people employed didn't increase during September, suggesting the economy isn't adding or losing jobs.
Political Perspectives
Political groups have differing views on the data. The Council of Trade Unions (CTU) sees the high unemployment rate as a sign of the government's failure to fix the economy, with workers and their families struggling.
The Taxpayers' Union, on the other hand, argues that rising unemployment proves the need for their full capital expensing tax policy.
The Government's Response
Finance Minister Nicola Willis acknowledges the challenges but emphasizes the government's efforts to rebuild the economy and create job opportunities.
"Our government is determined that New Zealanders who are seeking work can find it," she says, highlighting initiatives like the Investment Boost tax incentive and accelerated infrastructure projects.
The Bottom Line
While the job market may be showing some signs of life, the road to recovery is a long and winding one. The government's efforts are a step in the right direction, but more needs to be done to address the challenges faced by workers and their families.
