NZ's dole queue has shrunk for the first time this year, raising hopes that employment might pick up sooner than expected.

Workers are feeling more upbeat about their jobs in the wake of better than expected economic news, according to a bank survey.

Employers have snapped up more than 1000 places under the Government's new Job Ops subsidy scheme for young people.

While the number of people on benefits is rising, there are positive signs, says Social Development Minister Paula Bennett.

Several factors, including an improving housing market, are fueling a stronger domestic recovery, Treasury says.

After three months of exhaustive searching, IT expert Giles Aubrey is still unemployed.