Ease in jobs growth data tipped

By BRIAN FALLOW Economics editor

Employment figures out on Thursday are expected to show some softening of the labour market in the last three months of 2000.

The September quarter was very strong, recording a 1.2 per cent rise in the number of people employed - albeit following two quarters in which employment shrank - as the unemployment rate dropped to 5.9 per cent, its lowest for 12 years.

But ANZ Bank, which monitors job advertisements in newspapers, said this and other indicators pointed to modest employment growth in the December quarter.

Job ads have been reducing since late 1999 and fell sharply in December, although ANZ said early indications were that they rebounded sharply last month.

ANZ expects Thursday's household labour force survey figures to show a quarterly rise of 0.3 per cent in numbers employment, which is in line with the median forecast in a Dow Jones survey of economists' expectations.

The consensus pick is for a slight rise in the unemployment rate to 6 per cent.

The New Zealand Institute of Economic Research's December quarterly survey of business opinion (QSBO) found that firms were intending to take on more staff over the next 12 months, despite continuing difficulty in attracting skilled employees.

But the Bank of New Zealand said the QSBO report, while improved, pointed to tepid rather than strong employment gains in the near term.

"While skilled staff are becoming more difficult to find, the uncertainty relating to trading partner growth is likely to relieve some of this pressure by mid-year," the BNZ said.

The latest migration figures showed a net loss of 1440 people in December, compared with a net inflow of 240 a year earlier.

It pushed the annual loss for 2000 to 11,310, up from 9030 in 1999 and 6250 the year before.

The state of the labour market is one of the factors that the Reserve Bank will have to weigh against the worsening export outlook in when it sets interest rates over the months ahead.