New Zealanders were more downcast about their job and earnings prospects in the December quarter as falling commodity prices weighed on rural economies and seeped into the cities, according to the Westpac McDermott Miller employment confidence survey.
The index fell 4.9 points to 106.5 in the December quarter, with present conditions largely unchanged at 102.2, but employment expectations sliding 7.9 points to 109.4. A reading above 100 indicates more optimists outweigh pessimists. The decline snapped seven quarters of gains, and fell from a six-year high in the September period.
"Following a string of bad news in the global economy, as well as falls in the prices for some commodity exports, many New Zealanders have become nervous about the outlook for the coming year," Westpac economist Satish Ranchhod said in a statement. "This nervousness has seen households becoming more pessimistic about the availability of jobs over the coming year, and has prompted them to wind back their expectations for wage increases."
New Zealand's unemployment rate fell to 5.4 per cent in the September quarter, the lowest since March 2009, and employment grew at a faster pace than expected, while increased net migration lifted the supply of labour and kept a lid on wages.
Today's survey shows workers' expectations for earnings growth fell 8.6 points to a net 29.2 per cent of respondents expecting higher wages and past earnings growth slipped to 29.7 per cent from 31 per cent. Expected job opportunities fell to minus 9.4 per cent from minus 3.7 per cent in September, while current job opportunities were largely unchanged at a net minus 25.3 per cent.
