More good news as New Zealand unemployment drops again during Covid-19

In the December 2020 quarter, compared with the September 2020 quarter:

• Unemployment rate fell to 4.9 percent.
• Underutilisation rate fell to 11.9 percent.
• Employment rate rose to 66.8 percent.
• Average ordinary time hourly earnings rose to $34.14.

In the year to the December 2020 quarter:

• Wage rates increased 1.6 percent.
• Filled jobs increased 0.9 percent.

 

Unemployment

The seasonally adjusted unemployment rate was 4.9 percent in the December 2020 quarter, down from 5.3 percent in the September quarter.

• For men, the unemployment rate was 4.5 percent, down from 4.8 percent last quarter.
• For women, the unemployment rate was 5.4 percent, down from 5.8 percent.
•  

The seasonally adjusted number of unemployed people fell to 141,000 (down 10,000) since the September 2020 quarter.

• 5,000 fewer men were unemployed.
• 5,000 fewer women were unemployed.
•  

In the year to the December 2020 quarter, there were 25,000 more unemployed people:

• 11,000 more men were unemployed.
• 15,000 more women were unemployed.
•  

The unemployment rate (not seasonally adjusted) for the following ethnic groups in the December 2020 quarter was:

• 3.7 percent for European (no statistically significant change since the December 2019 quarter)
• 9.0 percent for Māori (no statistically significant change since the December 2019 quarter)
• 9.6 percent for Pacific people, up from 7.2 percent in the December 2019 quarter
• 5.2 percent for Asian, up from 3.4 percent in the December 2019 quarter.
•  

The unemployment rate (not seasonally adjusted) for following age groups in the December 2020 quarter was:

• 10.1 percent for 15–29-year-olds (up from 8.4 percent in the December 2019 quarter)
• 3.3 percent for 30–54-year-olds (up from 2.6 percent in the December 2019 quarter)
• 2.5 percent for 55 and over (no statistically significant change since the December 2019 quarter).

The unemployment rate in Auckland was 5.3 percent, up from 4.1 percent in December 2019 quarter.

 

Underutilisation

The seasonally adjusted underutilisation rate in the December 2020 quarter fell to 11.9 percent, down from 13.2 percent in the September 2020 quarter.

• For men, the underutilisation rate fell to 9.7 percent, down from 10.5 percent.
• For women, the underutilisation rate fell to 14.3 percent, down from 16.1 percent.

In the December 2020 quarter, the number of people who were underutilised fell to 352,000 (down 39,000).

• 14,000 fewer men were underutilised.
• 25,000 fewer women were underutilised.

Underutilisation is a broad measure of spare capacity in New Zealand’s labour market and is just as important as the unemployment rate, as it gives us a more detailed picture of the workforce.

 

The fall in the number of underutilised people included:

• 10,000 fewer unemployed people
• 18,000 fewer underemployed people – these are people who are employed part time (working fewer than 30 hours a week) and have both the desire and availability to increase the number of hours they work
• 11,000 fewer in the potential labour force – these are people who are not actively seeking but are available and wanting a job and people who are actively seeking but not currently available, but will be available to work in the next four weeks.
•  

Employment and filled jobs

The seasonally adjusted employment rate in the December 2020 quarter rose to 66.8 percent, up from 66.4 percent in the previous quarter.

• For men, the employment rate rose to 72.1 percent, up from 71.8 percent last quarter.
• For women, the employment rate rose to 61.7 percent, up from 61.2 percent last quarter.
•  

In the December 2020 quarter, there were 17,000 more employed people, up to 2,734,000.

• 7,000 more men were employed.
• 10,000 more women were employed.

In the year to the December 2020 quarter, there were 19,000 more employed people:

• 16,000 more men were employed.
• 2,000 more women were employed.
•  

The seasonally adjusted number of filled jobs, as measured by the quarterly employment survey (QES), rose by 16,500 (0.8 percent) to 1,998,500 in the December 2020 quarter. Filled jobs increased by 18,300 (0.9 percent) annually.

 

Differences between the filled jobs in the QES and employment numbers in the HLFS can largely be explained by differences in survey coverage. The QES excludes a number of industries, including agriculture, and those who are self-employed without employees, to better fit international standards. Conversely, the HLFS only includes usually resident New Zealanders, so can exclude some temporary seasonal labourers.

 

Increase in number of self-employed and business owners

The number of people who were self-employed (with no employees) increased from 313,800 in the December 2019 quarter, to 343,900 in the December 2020 quarter. This was an annual increase of 30,100 (9.6 percent).

• 15,500 more men were self-employed (with no employees).
• 14,600 more women were self-employed (with no employees).
•  

Between December 2019 and December 2020 quarters, an additional 49,100 people owned their own business. Of the increase in business owners, 32,200 were self-employed without employees.

 

More people feel secure in their job

Feelings of job security rose in the December 2020 quarter, with 42.4 percent of people saying there was almost no chance they would lose their job or business in the next 12 months, compared with 37.4 percent in the previous quarter.

Labour force participation

The seasonally adjusted labour force participation rate in the December 2020 quarter rose to 70.2 percent, up from 70.1 percent in the September 2020 quarter.

• For men, the labour force participation rate rose to 75.5 percent, up from 75.4 percent the previous quarter.
• For women, the labour force participation rate rose to 65.2 percent, up from 65.0 percent the previous quarter.

There were 3,000 fewer people (all women) not in the labour force (NILF) over the quarter, down to 1,218,000.

 

Youth not in employment, education, or training (NEET)

In the December 2020 quarter, the seasonally adjusted proportion of people aged 15–24 years who were not in employment, education, or training (NEET) fell to 12.4 percent, down from 12.5 percent the previous quarter.

• The NEET rate for young men was 11.7 percent, up from 11.4 percent.
• The NEET rate for young women was 13.1 percent, down from 13.7 percent.

The number of young people who were NEET fell by 1,000 over the quarter.

• 2,000 more young men were NEET.
• 2,000 fewer young women were NEET.
•  

Wages increase

The labour cost index (LCI) salary and wage rates (including overtime) increased 1.6 percent in the year to the December 2020 quarter, while the unadjusted LCI increased 2.5 percent.

• Private sector wages increased by 1.5 percent.
• Public sector wages increased by 2.0 percent.
•  

Quarterly, salary and wage rates (including overtime) rose by 0.4 percent since the September 2020 quarter. Public sector wages increased 0.3 percent, down from 0.9 percent in the previous quarter. In the private sector, wage inflation during the quarter was 0.5 percent as wages continued to return to pre-COVID levels and surveyed businesses reported efforts to retain and attract staff.

 

The main industries that drove quarterly wage inflation in the LCI were education and training, retail trade and construction.

Over the year to the December 2020 quarter, wages as measured by the QES also grew. Average ordinary time hourly earnings increased to $34.14 (up 4.2 percent).

• Private sector ordinary time hourly earnings increased by 4.4 percent, to $31.91.
• Public sector ordinary time hourly earnings increased by 2.9 percent, to $42.54.
• Average weekly earnings (including overtime) for full-time equivalent employees (FTEs) in the QES also increased on an annual basis - up 3.3 percent to $1,313.92.
•  

Changes to seasonal adjustment for HLFS series

Due to the unprecedented impact of COVID-19 in the June and September 2020 quarters, several seasonally adjusted series were specially treated to maintain a consistent estimate of the seasonal pattern.

 

As of the December 2020 quarter, the effect of COVID-19 on key labour market series is no longer significant enough to require continued intervention. Interventions that we implemented on the June and September quarters seasonally adjusted values remain in place.

 

At this point the trend series is still not able to be accurately calculated, and publication of the trend series will remain suspended until we have sufficient data following the June and September quarters to stabilise the trend series

 

New survey design for the quarterly employment survey (QES)

The QES will be refreshing its sample and moving to a new online survey design from the March 2021 quarter onwards. We will continue to publish the same measures currently reported on, but anticipate some revisions as a result of these changes.

A new back series and further details about the upcoming changes to the updated QES will be available in advance of Labour market statistics: March 2021 quarter on 5 May 2021.

Automotive Employment NZ have recorded unemployment rates since 2004.  Here is the link to historical information