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Labour Market Statistics: September 2015 quarter
Embargoed until 10:45am  –  04 November 2015
Commentary

 Labour market diagram

 

Number of employed people falls for first time in three years

For the September 2015 quarter employment fell (down 0.4 percent), with 11,000 fewer people employed than in the previous quarter. This is the first quarter employment has fallen in three years (employment fell 0.5 percent in the September 2012 quarter).

In the September 2015 quarter the working-age population increased by 22,000 people (0.6 percent). This is the second consecutive quarter that employment growth has not kept up with growth in the working-age population.

Working-age population and employment

 

Unemployment rate rises to 6.0 percent

The unemployment rate rose to 6.0 percent in the September 2015 quarter – up from 5.9 percent for the June 2015 quarter. There were 3,000 more unemployed people in the quarter, bringing the number of unemployed to 151,000 – the highest number since the June 2013 quarter.

Tasman/Nelson/Marlborough/West Coast had the only statistically significant change in regional unemployment rates, with an increase to 5.7 percent, (up 2.1 percentage points).

Map, Unemployment rates by regional council area, September 2015 quarter.

The unemployment rates differed for men and women. For men, the number of unemployed rose by 4,400, while for women the number fell by 1,500 in the September 2015 quarter. This resulted in a 5.6 percent unemployment rate for men (up 0.4 percentage points), and a 6.6 percent rate for women (down 0.1 percentage points). This is the highest unemployment rate for men since the September 2013 quarter.

In the year to September 2015, the number of unemployed people increased 14,000 (up 10.5 percent). The unemployment rate increased 0.4 percentage points over the year, up from 5.6 percent in the September 2014 quarter.

Labour force participation falls for second quarter

The September 2015 quarter labour force participation rate was 68.6 percent, down 0.7 percentage points from the June 2015 quarter, and down from the record high (69.5 percent) in the March 2015 quarter. The labour force participation rate was back at the same level as in June 2014. Despite the growing working-age population, the labour force (unemployed and employed) is not growing at the same rate.

The latest quarter had the largest increase in the number of people not in the labour force (2.6 percent) since the March 2009 quarter.

While Auckland made the greatest contribution to growth in the working-age population over the year to the September 2015 quarter (36,800 people), it also had 23,700 more people who were not in the labour force.

Younger age groups entering labour force

In the year to September 2015, growth in the labour force was highest for people aged 20–29 years, with 35,900 more people. This growth came from increases in both the numbers employed (28,300 people) and unemployed (7,600 people).

In comparison, increases in the number not in the labour force came from people aged 50–54 years (10,900) and 65 years and over (14,100), in the year to September 2015. The growth in the number not in the labour force came predominately from people who were retired (20,100 people).

Construction boom supports annual employment growth

In the year to September 2015, annual employment growth was 1.5 percent (34,000 people).The largest contributor to national employment growth over the year was construction, which employed 20,500 more people (statistically significant).

Auckland (14,700 people) and Canterbury (5,000 people) were the top two regions contributing to the employment growth in construction for the year.

The following graph shows the industries that contributed to annual employment growth. 

Graph, Change in employment, by industry, September 2015 quarter.

The largest contributions to the rise in filled jobs over the year (reported by businesses in the QES) came from:

  • construction (15,300)
  • health care and social assistance (6,600)
  • accommodation and food services (5,200).

Regional employment slowing

In the year to September 2015, Auckland’s annual employment growth fell after a particularly strong period of growth over the last two years. Auckland’s employment growth slowed to 1.5 percent (11,500) down from 3.9 percent in the year to June 2015. Auckland's growth came from the construction industry (14,700 people), retail trade, accommodation, and food service industry (8,400 people), and health care and social assistance industry (7,600 people). However, falls in financial and insurance services, manufacturing, and wholesale trade all contributed to the slowing employment growth.

Canterbury’s annual employment growth continued to ease, with growth of 1.3 percent (4,200) coming from the agriculture, forestry, and fishing industry (5,400) followed by the construction industry (5,000). Falls in the number employed in professional scientific, technical, administrative, and support services, and in public administration and safety, contributed to the slowing Canterbury employment growth.

Of all regions, Bay of Plenty had the highest, and only statistically significant, annual employment growth – 6.1 percent (8,100 people).

 Graph, Annual change in employment by region, unadjusted series, September 2013 to September 2015.

Female NEET rate lowest on record

The proportion of youth (15–24 years) not in employment, education, or training (NEET) was the lowest in seven years, at 11.0 percent (down 0.5 percentage points).

The NEET rate for women fell 1.1 percentage points (to 12.3 percent) over the latest quarter – the lowest rate since the series began in March 2004. The NEET rate for men rose 0.2 percentage points (to 9.9 percent).

The NEET rate fell as more 15–24-year-olds moved into education (9,000 more) over the quarter. 

Number of jobless rises over the year

The total number of jobless people for the September 2015 quarter was 269,600, up 40,100 (17.5 percent) from the September 2014 quarter .

Jobless people include those officially unemployed, those available for but not actively seeking work, and people actively seeking but not available for work. This is a useful indicator of how many people are on the fringe of the labour market.

Jobless diagram, Annual change - September quarter 2015

Annual wage inflation remains at 1.6 percent

Quarterly Employment Survey hourly earnings and labour cost index (LCI) figures are not seasonally adjusted.

In the year to September 2015 quarter:

  • The LCI (including overtime) increased 1.6 percent. (This measure of wage inflation reflects changes in the rates that employers pay to have the same job done to the same standard).
  • The unadjusted LCI increased 2.7 percent. (This allows for quality changes within occupations as well as wage inflation).
  • Average ordinary-time hourly earnings increased 2.3 percent, down from a 2.8 percent increase in the year to June 2015. (This measures the average hourly wage bill across all jobs in surveyed industries).

Graph, Annual percentage change in salary and ordinary time wage rates, September 2010 quarter to September 2015 quarter.

LCI continues to outpace inflation

In the year to September 2015, prices of goods and services bought by households, as measured by the consumers price index (CPI), increased 0.4 percent; the CPI excluding petrol increased 0.8 percent. 

See Consumers Price Index: September 2015 quarter.

The LCI salary and wage rates (including overtime) increased 1.6 percent over the same period. Wage inflation has now been higher or equal to the CPI for four years.

Graph, Annual percentage change in CPI and LCI, September 2010 quarter to September 2015 quarter.

Private and public sector wage growth remain steady

In the year to the September 2015 quarter, private sector salary and wage rates (including overtime) increased 1.7 percent, down from 1.8 percent last quarter. Note: We calculate percentage movements using rounded index numbers. If we used unrounded index numbers,  the private sector LCI would be unchanged at 1.8 percent.

See data quality for more details.

Public sector annual wage growth was unchanged at 1.2 percent for the fourth consecutive quarter.

For pay rates that rose in the September 2015 quarter, the mean increase for the private sector was unchanged (2.9 percent). The public sector mean increase eased (to 1.7 percent, from 2.1 percent last quarter).

For more detailed data about labour market statistics, see the Excel tables in the 'Downloads' box.

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