Latest figures show slight rise in unemployment

12.10pm

UPDATED REPORT - After hitting 16-year lows in the September quarter last year, the New Zealand unemployment rate has climbed, official statistics released today show.

The seasonally adjusted unemployment rate was up 0.2 percentage points to 4.6 per cent, Statistics New Zealand said in its December 2003 quarter Household Labour Force survey released today.

That increase was not regarded as statistically significant, a survey spokesman told reporters.

It was slightly above the 4.4 per cent rate attained in the September 2003 quarter, a level economists had forecast would be maintained.

"Results show an easing in the strong employment growth seen over the past two quarters, but still reflect tight labour market conditions," Government Statistician Brian Pink said.

Only five of 27 OECD countries -- Korea, Luxembourg, Netherlands, Switzerland and Austria -- have a lower unemployment rate than New Zealand. Australia has a rate of 5.6 per cent.

Quarterly employment growth was 0.1 per cent -- down on the 0.4 per cent forecast. The annual employment rate was 2.7 per cent up, with 1.939 million people employed. Economists had forecast it to climb by 3.2 per cent.

The Labour force participation rate of 66.5 per cent, was lower than forecasts of 66.7 per cent.

Unadjusted unemployment rates for Pacific Islanders increased slightly over the year to December 2003, while rates for pakeha, Maori and other ethnic groups all decreased over the year.

Maori had an unadjusted unemployment rate for the quarter of 10.0 per cent. It was 8.8 per cent for Pacific peoples, 6.9 for other ethnic groups and 3.2 per cent for pakeha.

Maori unemployment had reached a 10-year low of 9.7 per cent in the previous quarter.

Seasonally adjusted figures showed quarterly employment growth of 0.1 per cent.

Growth in jobs had shrunk, with only 1000 new jobs created during the quarter, though more people were working full-time.

Male employment increased by 0.3 per cent over the quarter, with female employment down 0.2 per cent.

There was a significant increase in the number employed in the property and business services industry, and a significant seasonal fall in the education industry in the quarter, the survey said.

There was a shift from part-time to full-time employment during the quarter, with full-time employment growing by 0.5 per cent, and part-time employment falling by 1.4 per cent.

Total actual hours worked rose by 0.9 per cent in the quarter.

Job growth was at its lowest level in five quarters.

Citigroup economist Annette Beacher said the survey had revealed a softer-than-expected employment outcome, but the economy was simply "off the boil", not dramatically slowing.

She predicted strong domestic demand and inflationary pressures would persuade Reserve Bank governor Alan Bollard to again lift the cash rate next month.

"The composition of jobs growth reflects a very solid economy, as full-time employment rose another 0.5 per cent in the quarter, and part-time employment (was) down 1.4 per cent.

"With solid wages data for the December quarter and likely buoyant real retail sales growth in (the fourth quarter) domestic demand forces in New Zealand remain sound," she said.

Concerns over the elevated New Zealand dollar were "over-stated", she said.

- NZPA