Key vows to deliver more jobs this year

Prime Minister John Key. Photo / Greg Bowker

Prime Minister John Key yesterday called for voters to maintain confidence his Government's economic plan will deliver more jobs this year in spite of a bounce in unemployment which Labour says is further evidence the plan is flawed.

As National works to convince New Zealanders it is the more competent manager of the economy, December jobs data yesterday showed the unemployment rate rising from 6.4 to 6.8 per cent.

However, Mr Key pointed out the headline unemployment measure was notoriously volatile while acknowledging that the second half of last year was tough as international turmoil stemming from the European debt crises sapped confidence among employers in New Zealand.

"Again we come up to 2011 with confidence looking more perky again, and you've got to remember unemployment's a lagging indicator, not a leading indicator, so typically it tells you what has happened, not what's happening in the future.

"What we see is a lot more energy from the New Zealand corporate sector, we see them looking to employ more people, we're seeing an increasing number of jobs being advertised, we're seeing a reduction of people on the unemployment benefit from the high over Christmas. I think we shouldn't lose confidence ... all the indications we have is that 2011 will be a better year."

But Labour's deputy leader, Annette King, said yesterday's evidence that 7000 additional New Zealanders were out of work in the last three months of the year undermined Mr Key's "promises of a brighter future".

"We are in the third year that he has been in charge of the economy and we are going backwards."

She said Mr Key's claims that summer would bring a job boost had gone the same way as the 4000 jobs he said the national cycleway would bring. "In fact, the cycleway has created just 200 jobs."

The National Government had not made tackling unemployment a sufficiently high priority, she said.

"An active government approach with an emphasis on jobs and skills training is sorely needed to get New Zealand working again."

Engineering, Printing and Manufacturing Union national secretary and Labour president Andrew Little warned that unless there were new initiatives to encourage employers to hire staff, "very soon it's likely that this high level of unemployment will become structural and that would be a disaster for working Kiwis and for the economy".

Social Development and Employment Minister Paula Bennett said yesterday's figures showed the economy was "still very much in a slow recovery, making the Government's push towards investment to create sustainable jobs vital".

"The road to recovery is a bumpy one, employers have boosted working hours before hiring new staff, but they're indicating they'll take on more staff this year."

UNEMPLOYMENT
New Zealand: 6.8 per cent
Australia: 5 per cent
UK: 7.8 per cent
Ireland: 13.9 per cent

- Additional reporting: NZPA