New Zealand's labour market heated up in early 2016

Photo by Phil Walter/Getty Images

New Zealand’s labour market performed well during the first quarter of the year.

According to Statistics New Zealand, employment jumped by 1.2% in the three months to March after seasonal adjustments, leaving the total number of employed at 2.399 million. From a year earlier employment increased by 2.0%.

Employment increased for men and women this quarter, including for women going into full-time employment, said Statistics New Zealand.

Despite the acceleration in hiring, the national unemployment rate rose to 5.7% from an upwardly revised 5.4% level in the December quarter 2015. Although above expectations for an increase to 5.5%, the figure remains below the 5.8% level of a year ago.

“The total labour force increased by 38,000 people in the March 2016 quarter,” labour market and households statistics senior manager Jason Attewell said. “This resulted in more New Zealanders in unemployment and employment than three months ago.”

As a result of the increase in the size of the labour force, the number of unemployed rose by 7.4% to 144,000. Though a sizeable increase, it was a result of a larger labour market pool, not job losses. From the same quarter a year ago total unemployed actually fell by 0.3%.

With employment outpacing growth in the labour force, the national employment rate rose to 65.1% from 64.9% in the prior quarter.

Overall labour market participation — those in the labour force in employment or looking for work — rose by 0.5% to 69.0%, ahead of the 68.6% median market forecast.

Perhaps due to the increase in participation, annual wage inflation remained subdued, increasing by 0.4% to 1.6%. Although weak, both were ahead of expectations.

Private sector wage grew 1.8%, outpacing those for public sector workers which increased 1.4%.

The table below, supplied by Statistics New Zealand, provides further details.

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