New Zealand labour market data for the September quarter has just been released, and it’s a shocker.
Over the quarter employment fell by 11,000, or 0.4%, missing expectations for an increase of 0.4%. It was the first fall in employment seen since the June quarter of 2012.
From a year earlier employment increased by 1.5%, down sharply on the 3.0% growth seen during the June quarter.
The unemployment rate ticked up to 6.0% from 5.9%, in line with expectations, but this was entirely due to a plunge in labour market participation.
It slumped to 68.6% from 69.3% in the June quarter, falling the to the lowest level seen since the December quarter of 2013.
“Until recently, the labour market has been keeping pace with New Zealand’s population growth, but in the past three months this has changed,” said Diane Ramsay, labour market and households statistics manager at Statistics New Zealand.
“This quarter also had the largest increase in the number of people outside the labour force since the March 2009 quarter.”
The total number of unemployed rose to 151,000, up 2.0%, leaving the annual increase at 10.5%.
Fitting with the weakness elsewhere in the report, labour costs rose 0.4%, below the 0.5% gain expected, leaving the annual increase at 1.7%. While soft, the New Zealand’s annual inflation rate currently sits at just 0.4%, meaning real wages continue to increase.
Given the data unilaterally missed to the downside, the New Zealand dollar is under the kosh in early Asian trade. The NZD/USD currently buys .6663, down on the .6708 level seen prior to the data release.
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