Unemployment falls to 4.7% as more women find work

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Unemployment dropped to 4.7 per cent in the first three months of the year as more women found work, according to Stats NZ.

But the department said the number of people who had only part-time work was the highest it had ever been.

That does not appear to be entirely through choice. Stats NZ said the proportion of “under-utilised” workers who had fewer hours than they wanted edged up by 0.4 percentage points, leaving 366,000 people, or 12.2 per cent of the workforce, in that position.

There were concerns last year that the Covid pandemic was having a disproportionate impact on the employment prospects of woman, who tend to be more likely to work in sectors that have been hard-hit by the pandemic, including hospitality and retail.

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But in the March quarter, male unemployment rose from 4.5 per cent and female unemployment fell from 5.3 per cent, both converging at 4.7 per cent.

Not all the numbers went in the right direction for female workers, however.

Slightly over half of the 366,000 workers who wanted more hours were women and the increase in the “underemployment” rate during the quarter was almost entirely the result of an additional 7000 women being in the situation of wanting more work, with little change for men.

The proportion of people aged 15 to 19 who were not in employment, education or training also rose from 8.6 per cent to 10.8 per cent over the quarter.

Stats NZ cautioned against reading too much into comparisons with the overall 4.9 per cent unemployment rate in December quarter, saying it had made a number of tweaks to improve the way the figures were calculated, including changing its polling samples.

“There have been some gains in labour market outcomes, especially for woman, over the past two quarters,” senior manager Sean Broughton said.

“However, annual changes indicate the labour market still hasn’t returned to pre-Covid levels for men or women.”

Women saw a much larger increase in the unemployment rate last year than men, and that rate has declined over the last two quarters, he said.

“However, they continue to have a much higher rate of underemployment than men.”

Finance Minister Grant Robertson said the Government’s plan “to keep people connected to their job and accelerate the recovery” had been reflected in the positive employment numbers.

Employment Minister Carmel Sepuloni said unemployment was “likely to move around a bit due to the ongoing impact of the pandemic”.

“Nevertheless, New Zealand has performed favourably against the countries we measure ourselves against,” he said.

The unemployment rate is 5.9 per cent in Australia, 6.2 per cent in the United States and 8.4 per cent in Canada, he said.

Infometrics economist Brad Olsen expected the labour market would continue to have spare capacity over this year, “although this capacity seems to be concentrated in underutilisation rather than in unemployment”, he said.

ANZ said the numbers were “very solid” but forecast further gains in the labour market this year would be hard won.   

Bank economists had been divided ahead of the announcement whether unemployment would rise or fall, in part because of uncertainty about whether more people would be classed as available for work.

But Stats NZ figures showed that unemployment fell despite a 0.1 percentage point rise in the labour force participation rate – the proportion of people available for work – which now stands at 70.4 per cent, and a 0.2 per cent rise in the working age population.

The increase in the labour participation rate and the drop in unemployment were reflected by a 0.3 per cent seasonally-adjusted increase in the employment rate to 67.1 per cent.

In a sign stronger employment numbers may be starting to have more of an effect on pay, Stats NZ said wage inflation held steady in the March quarter.

That made it the first quarter since the December 2019 quarter when annual wage inflation had not slowed, Stats NZ said.