‘Unemployment rate rises to 8.2 per cent’

The unemployment rate in New Zealand came in at 5.9 percent in the second quarter of 2015, Statistics New Zealand said on Wednesday. That flood of new labour has helped keep wage inflation tame as more people compete for jobs, while the accelerating economy has been able to soak up new workers.

The report showed that the number of underemployed in the labour force during the review quarter increased by 1,362,274 or 11.16 per cent, resulting in an increase in the underemployment rate to 18.3 per cent. The figure was in line with the median expected in a Wall Street Journal poll of 10 economists and was slightly higher than the 5.8% in the prior quarter.

Public sector ordinary wages rose 0.3 per cent in the quarter for a 1.2 per cent annual rise.

Earlier this year, the Reserve Bank said it was monitoring wage and price-setting outcomes after consumer price inflation fell short of its expectations.

The Household Labor Force Survey has shown significant volatility in recent quarters, leading the government, market commentators and investors to also look at the Labor Cost Index Survey and the Quarterly Employment Survey when assessing the data.

Annual private sector labour costs rose 1.8 per cent.

“This is the first time since the December 2013 quarter that the construction industry has not been the largest contributor to annual growth in employment”, Ms Ramsay said.

The vast majority of growth was in Auckland (29,600 people), where the annual employment growth was driven by retail trade and accommodation, followed by construction.

Wellington’s unemployment improved to 5.6 per cent from 6 per cent in March.

Analysis of unemployment rate revealed that the working age, comprising persons within the age of 15 to 64, increased to 103.5 million in the Q2 up from 102.8 million in the first quarter.

On the other hand, 6.9 per cent of males were unemployed in the quarter under review compared to 15.4 per cent of underemployed.

The old definition however created a major challenge, as those who work for less than 40 hours, were classified as unemployed.