Slower labour force growth in the long term

Slower labour force growth in the long term

17 December 2015

New Zealand's labour force is projected to keep growing, driven by an increasing population and people working into older ages, Statistics New Zealand said today.

"In the short term, high net migration and the age composition of our population are contributing to a growing labour force," population statistics senior manager Vina Cullum said. "Plus we are seeing more men and women aged 55 years and over staying in the labour force."

Currently, 2.5 million people are in the labour force (employed and unemployed). The new projections indicate a total labour force of 2.7 million around 2023 and 2.9 million in the mid-2030s.

In the longer term, however, the labour force is likely to grow much slower. The projections indicate a total labour force of 3.1 million around 2050 and 3.2 million in the 2060s.

"In the long term, net migration is likely to be generally lower than the current high levels, and labour force participation rates may not keep increasing. Our increasingly older age structure will also slow labour force growth," Ms Cullum said.

According to the new projections, which are updated every 2–3 years, those aged 65 years and over (65+) will comprise an increasing share of the labour force. In 1991, 1 percent of the labour force was aged 65+. It is 6 percent currently and is projected to increase to 10 percent in the late 2020s.

The labour force includes people aged 15 years and over who regularly work for one or more hours per week for financial gain, people who work without pay in a family business, and people who are unemployed and actively seeking part-time or full-time work. People not in the labour force include people under 15 years of age, students who do not work for pay, people who are unemployed and not actively seeking work, some people with childrearing responsibilities, people who work without pay (but not in a family business), and people who have retired.

For more information about these statistics:
• Visit National Labour Force Projections:2015(base)–2068

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