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Unemployment rate down to 4.0 percent

The seasonally adjusted unemployment rate was 4.0 percent in the December 2019 quarter, down from 4.1 percent (revised) last quarter, Stats NZ said today.

“The unemployment rate has largely been tracking down since late 2012, but has remained stable at around 4.0 percent throughout 2019,” labour market and household senior manager Sean Broughton said.

The fall in the unemployment rate this quarter reflected 3,000 fewer unemployed people, driven by 3,000 fewer unemployed women.

The unemployment rate for women dropped to 4.3 percent in the December 2019 quarter, down from 4.5 percent last quarter. For men, it was unchanged at 3.8 percent.

Underutilisation rate falls to 11-year low

The seasonally adjusted underutilisation rate fell to 10.0 percent in the December 2019 quarter, down from 10.4 percent last quarter.

This is the lowest rate of underutilisation since the June 2008 quarter, when it was 9.9 percent. Underutilisation provides a broader gauge of untapped capacity in New Zealand’s labour market.

“Underutilised people include those who have a job but want to work more hours, or are available to work but aren’t looking, or are looking for work but aren’t available to start within the next month,” Mr Broughton said.

“For example, a parent looking to start work once their child begins school in the coming months, or someone who has just finished high school but hasn’t started looking for a job.”

For men, the underutilisation rate remained unchanged at 8.3 percent. For women, it fell to 11.8 percent, down from 12.6 percent last quarter. This is the lowest underutilisation rate for women since the June 2008 quarter, when it was 11.6 percent.

Overall, the number of underutilised people fell to 285,000 – down 11,000. This fall was entirely driven by 12,000 fewer women who were underutilised.

“While women have largely been driving the decrease in underutilisation over the past few years, the rate of underutilisation for men has remained relatively low,” Mr Broughton said.

“This quarter, the rates of underutilisation for men and women are the closest together they’ve been since December 2011.”

Employment rate falls

The seasonally adjusted employment rate fell to 67.3 percent in the December 2019 quarter, down from 67.5 percent last quarter.

For men, the employment rate fell slightly to 72.2 percent, down from 72.3 percent last quarter. For women, it fell to 62.5 percent, down from 63.0 percent last quarter.

In the December 2019 quarter, there were 1,000 more employed people, up to 2,648,000. This reflected a rise of 6,000 more employed men, which was offset by 5,000 fewer employed women.

The fall in the employment rate this quarter reflected the number of employed people (up 1,000) increasing at a slower rate than the working-age population (up 16,000).

On an annual basis, filled jobs, as measured by the quarterly employment survey (QES), increased 0.9 percent (unadjusted), which equates to 17,200 more jobs. Of this increase, 11,900 were held by men, and 5,200 were held by women.

People not in the labour force increase

The seasonally adjusted number of people who were not in the labour force (NILF) rose by 18,000 to reach 1,177,000 in the December 2019 quarter. This is the highest number of people who were NILF since the series began in 1986.

This rise was driven by 15,000 more women who were NILF, while the number of men who were NILF rose by 3,000.

The labour force participation rate fell to 70.1 percent in the December 2019 quarter, with the other 29.9 percent of the working-age population being NILF.

The labour force participation rate for women dropped to 65.4 percent this quarter, down from 66.0 percent last quarter. The rate for men remained stable at 75.1 percent.

Using unadjusted figures, people aged 65 years and over (65+) made up the largest proportion of people who were NILF, at 47.9 percent. This was followed by 15–19-year-olds, at 14.2 percent.

Consistent with previous quarters, the main activity for people aged 65+ and NILF, such as retirees, was free-time activities, followed by household work for their own household. The main activity for 15–19-year-olds who were NILF was study and training.

“The majority of main activities were reported in roughly equal numbers by men and women, but women who were not in the labour force were much more likely than men to report that their main activity was caregiving for children or adults, or household work for their own home,” Mr Broughton said.

“This quarter, roughly 22 percent of women who were not in the labour force reported their main activity as looking after either a child or an adult, compared to roughly 6 percent of men not in the labour force.”

Wage rates grow over the year

The labour cost index (LCI) salary and wage rates (including overtime) increased 2.6 percent in the year to the December 2019 quarter. This is the largest increase since the June 2009 quarter, when it increased by 2.8 percent.

Average ordinary time hourly earnings, as measured in the quarterly employment survey (QES), increased by 3.6 percent over the year to reach $32.76.

Average weekly earnings (including overtime) for full-time equivalent employees (FTEs) in the QES also increased – up 3.6 percent over the year to the December 2019 quarter to reach $1,272.12.

See Wage growth remains at 10-year high for more information on wages in the December 2019 quarter.

Data adjustment

In the December 2018 quarter, Stats NZ further adjusted 10 high-level seasonally adjusted data series to improve their accuracy.

Stats NZ recommends users exercise caution when making comparisons with December 2018 quarter data for all other series, and instead focus on longer-term trends.

See Note on data adjustment and caution in this quarter’s information release for more information.

Text alternative for Labour market summary, December 2019 quarter, seasonally adjusted.

Diagram shows data from December 2019 quarter’s household labour force survey (HLFS), quarterly employment survey (QES), and labour cost index (LCI). HLFS results for the December 2019 quarter showed the labour force participation rate was 70.1%, down 0.3pp (percentage points). This rate is derived from labour force divided by working-age population. The employment rate was 67.3%, down 0.2pp. This is derived from employed divided by working-age population. The unemployment rate was 4.0%, down 0.1pp. This is derived from unemployed divided by labour force. The underutilisation rate was 10.0%, down 0.4pp. This is derived from total underutilised divided by extended labour force. The working-age population was up 16,000 to 3,937,000. This is made up of the labour force, down 2,000 to 2,760,000, and people not in the labour force, up 18,000 to 1,177,000. The labour force is made up of employed people, up 1,000 to 2,648,000, and those unemployed, down 3,000 to 111,000. Average ordinary time hourly earnings from the QES were up 3.6% annually, to $32.76. Annual wage inflation from the LCI was up 0.7pp to 2.6%, for all industries and occupations combined. Filled jobs from the QES were up 0.1% for the quarter, to 1,981,000. Note: Data, including rates, is seasonally adjusted, excluding average ordinary time hourly earnings and annual wage inflation.


View a video summary of the Labour market statistics: December 2019 quarter on the Stats NZ YouTube channel after 11am today.

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