Employment up but wages remain subdued

Results from the government’s Household Labour Force survey show a positive shift towards more confidence in the workplace.

Employment up but wages remain subdued

Results from the government’s Household Labour Force Survey, showing an increase in the number of eligible people participating in the workforce combined with a decrease in unemployment, is a positive step in the right direction for the New Zealand economy according to Paul Robinson, New Zealand Director of recruitment and HR services specialist Randstad.

“It is a double positive really. It’s only good news when we have more people working and the unemployment rate is dropping. It might only be a small shift, but it points towards increased confidence in the marketplace,” Robinson said in a statement.

Statistics New Zealand said the results showed employment growth was continuing in the labour market, but wages remain subdued. The employment rate rose to 64.4% and the unemployment rate fell to 6.2%.

Over the September 2013 year, the number of people employed rose 2.4% according to the survey while the demand for workers from established businesses rose 1.9% in the Quarterly Employment Survey.

"We saw continued improvement in labour market conditions over the quarter as employment rose and unemployment fell," industry and labour statistics manager Diane Ramsay said in a statement. "However, annual wage inflation remains restrained."

Annual wage inflation, as measured by the labour cost index (LCI) salary and ordinary time wage rates, eased to 1.6% in the September 2013 quarter, down from 1.9% this time last year.

Robinson said while the changes were only small it showed a “good gradual increase which tells us the economy is expanding and growing”. He adds that it is further good news that the growth is not purely centred on the Christchurch rebuild.

“It is very interesting to see the positive growth is not just driven out of Christchurch. If it were just down to Christchurch’s rebuild then we wouldn’t be seeing growth across the board like we are,” he said. “The new statistics show the working-age population in Auckland has increased over the year and growth in employment is still larger than growth in the working-age.”

Key findings of the September 2013 quarter compared with the June 2013 quarter show:

  • The number of people employed increased by 27,000 people. 
  • The employment rate rose 0.7 percentage points, to 64.4%.
  • The number of people unemployed decreased by 4,000 people.
  • The unemployment rate fell 0.2 percentage points, to 6.2 %.
  • The labour force participation rate increased 0.5 percentage points, to 68.6%.

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