Labour force ageing and growth slowing

Embargoed until 10:45am – 6 May 2008

Labour force ageing and growth slowing

An ageing profile and a slowing growth rate are likely to characterise the New Zealand labour force over the period to 2061, Statistics New Zealand said today. This is from mid-range projection (series 5M), one of nine alternative projections released. Half of the labour force will be older than 42 years in 2011, compared with a median age of 40 years in 2006 and 36 years in 1991. This reflects the general ageing of both the population and the labour force.

New Zealand's labour force is projected to grow from an estimated 2.24 million at 30 June 2006 to 2.65 million in 2031 and 2.79 million in 2061. The projections indicate a decelerating growth rate in the labour force over the next five decades. With the population ageing, new entrants into the labour force will be largely offset by retirements from the labour force. The labour force is projected to grow by an average of 34,000 a year between 2006 and 2011. Further average growth of 20,000 a year is projected between 2011 and 2016. However, subsequent growth is expected to average less than 15,000 a year.

The labour force aged 65 years and over increased from 25,000 in 1991 to 62,000 in 2006. It is projected to increase to 160,000 in 2021 and about 200,000 from the mid-2030s. The proportion of the population aged 65 years and over who participate in the labour force increased from 6 percent in 1991 to 12 percent in 2006 and is assumed to increase to 20 percent in 2016. The number of people aged 65 years and over who are not in the labour force will double from 450,000 in 2006 to 900,000 in 2031, and then increase to 1.22 million in 2061.

The labour force comprises people aged 15 years and over who regularly work for one or more hours per week for financial gain, or work without pay in a family business, or 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, people with childrearing responsibilities, people who work without pay (but not in a family business), and people who have retired.

Geoff Bascand

Government Statistician

6 May 2008

ENDS

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