Unemployment rises

Jacinda Ardern cracking Photoshopped image credit: Luke

The bad news continues for this ramshackle government. Unemployment has risen to 4.3%, from 4% in September.

It may be a small increase and the government will be able to play it down as being close to the margin of error, but it is part of an emerging trend. Growth is slowing, unemployment is increasing. The economy is starting to soften and we need a competent government with strong economic management skills to guide us through the storm.

We don’t have such a government. quote.

Unemployment jumped at the end of 2018, as the number of new jobs being created slowed.

Statistics NZ said on Thursday that unemployment climbed to 4.3 per cent in December, up from a revised 4 per cent in September.

The New Zealand dollar dropped on the latest figures, as the market bets on whether the figures make an interest rate cut from the Reserve Bank more likely. end quote.

Adrian Orr predicted an interest rate cut last year but there was no reason to think it necessary at that stage. After a decade of low interest rates, it seems they are about to get even lower. quote.

Most of the climb in the number of unemployed – which rose by 10,000 to 120,000 – was due to unemployed men. The number of men unemployed rose by 8000 to 65,000, while the number of unemployed women rose by 2000 to 55,000. 

Economists had expected a small increase in the unemployment rate, after a sharp drop in September, but not to the degree the household labour force survey revealed.

“It looks like the best that the labour market has to offer is behind us,” ANZ senior economist Liz Kendall said.

end quote.

The bad news, as always, is that the worst affected group is the young people. NEETs, as they are known, with no training, now have less and less chance of finding employment. The government claims that it will target these people, especially Maori youth, but… well, they also said they would build 1,000 houses by July 2019. quote.

On Thursday, Employment Minister Willie Jackson released a statement describing the unemployment rate as “the second lowest in nearly a decade”, focusing on lower unemployment for women and M?ori since the coalition Government took office.

“The results released are in keeping with our expectations for this quarter and we are confident that in this strong economy, if we continue to listen to employers and work with industry, many people looking for work will find more opportunities to do so.” end quote.

Sorry, Willie, but you have got this wrong. The economy is not as strong as it was. The growth numbers for the December quarter are not out yet but they are likely to show a significant slowing of growth. You can no longer rely on the excellent economy that you were handed to get you out of trouble. It is downhill all the way from here. quote.

National’s finance spokeswoman Amy Adams said the figures suggest the economy may be slowing and the Government should take it as a “reality check”, with the number unemployed climbing, while those not in employment, education or training (so-called NEETs) rising by 26,000.

“The unemployment rate is still relatively low, however we have now slipped from having the 9th to the 14th lowest unemployment rate in the OECD. At the same time, jobs growth has stalled and the underutilisation rate has increased.

“These weaker labour market numbers follow the third quarter’s slower GDP growth and point to a change of direction for the New Zealand economy.

Stuff end quote.

With gale force winds blowing our way over Brexit and the China-USA trade situation, an economic slowdown looks inevitable. The real question is how well our government is going to be able to deal with it. I have no confidence in their level of economic competency. It looks as if Shane Jones will not be getting his ‘nephs’ of the couch for some time yet.