Unemployment Rise No Surprise As Economic Slowdown Starts To Bite
The EMA says news that unemployment continues to rise comes as no surprise given the conversations it has been having with its members, who are feeling the impact of a slowing economy.
The latest numbers released by Stats NZ today show that unemployment increased from 3.6% to 3.9% in the September quarter. This brings the total number of unemployed New Zealanders to 118,000
EMA Head of Advocacy Alan McDonald says while unemployment is still low by historical standards, this is the third quarter that unemployment had increased, and it was now at its highest level since the June 2021 quarter.
"The unemployment numbers released today reflect the feedback we are receiving from EMA members, which is that things are beginning to get tougher as the economy slows and costs continue to rise," says McDonald.
"Inflation is adding to the cost of doing business, while higher interest rates are diminishing the spending power of consumers. As a result, members are telling us that forward orders are beginning to slow down and businesses are starting to make some tough choices, including looking at their staffing levels.
"Our AdviceLine, which provides specialist employment advice to our members, has started receiving an increasing number of enquiries from employers who are looking at staffing needs, while our legal team is increasingly being asked for advice and support around restructuring proposals."
McDonald says that business conditions were likely to remain difficult for some time given inflation is proving difficult to bring down and all indications were that interest rates would remain higher for longer.
"What business needs most now is government that quickly gets down to business, works to bring inflation back under control and partners with the productive economy to address some of the challenges we face.
"It is the business community that will drive our economic recovery, which is why it is crucial that the new government works in partnership with business to enable investment, reduce red tape and address our infrastructure deficit.
"When business is doing well, the economy is doing well and that is good news for everyone because that means new jobs, higher wages and supports increased investment in social services such as health and education."