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OECD confirms policy spurred unemployment drop

28 June 2005

OECD confirms policy spurred unemployment drop

An OECD report released today confirms that government policies including Jobs Jolt and Work for You have contributed significantly to New Zealand's world-leading unemployment rates.

The report – OECD Employment Outlook 2005 – was welcomed by Social Development and Employment Minister Steve Maharey as an endorsement of the Labour-led government's strategy of training, intensive case management and job seeking assistance.

"This is a fantastic report card on the government's initiatives to help people move off benefits and into work," Steve Maharey said. "The OECD now considers New Zealand to be among the international success stories where sound policy has led to positive employment outcomes for thousands."

The OECD says that although New Zealand's unemployment rate was steadily falling as the economy strengthened from 2000, that it was not until a range of activation policies were implemented in 2003 that unemployment began to fall dramatically. By August 2004, unemployment had fallen by 30 per cent in one year.

The OECD states that much of the "large fall" can be attributed to the government's activation programmes.

"It is particularly heartening to see the OECD's positive comments on Jobs Jolt, Work for You and our efforts to reduce case manager loads. We've been adamant for some time that these initiatives were making a big difference, but it's great to have an independent assessment of just how valuable they are," Steve Maharey said.

The number of New Zealanders receiving the unemployment benefit fell by 27 per cent in the year to March 2005. Also in March, the total number of New Zealanders on benefits – including sickness, invalids, unemployment and DPB -fell below 300,000 for the first time in 16 years.

In total, unemployment benefit numbers have fallen by 62 per cent and total benefit numbers by 21 per cent since the Labour-led government was elected. At 3.9 per cent, New Zealand is one of only two countries with unemployment below 4 per cent.

ENDS

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