RWC brings more hours, not jobs

Dominick Stephens
Dominick Stephens
Employees appeared to work longer hours during the Rugby World Cup rather than employers taking on more staff to cope with increased demand.

Statistics New Zealand's household labour force survey showed unemployment went up 0.1% in the three months ending September to give an annual rate of 6.6%.

Most commentators were expecting a fall to 6.3% or 6.4%.

The participation rate for the quarter was 68.4%, again below market expectations.

Economists had been expecting evidence of temporary hiring for the RWC. The drop in part-time employment did not support that theory. Actual hours worked jumped 1% while usual hours worked fell 0.2%.

Westpac chief economist Dominick Stephens said that could suggest existing staff worked longer hours during the Cup.

"Stark differences between Canterbury and the remainder of New Zealand remain. Canterbury employment fell sharply, while outside of Canterbury, employment rose 1%."

That was consistent with the idea that reconstruction work had not yet begun by September and could also reflect that Canterbury did not host RWC matches, he said.

It could also partly reflect population movements around the country. The working-age population in Canterbury fell sharply in the September quarter and other evidence suggested relocation within New Zealand.

There was also a drop in the participation rate in Canterbury while participation in the rest of New Zealand rose.

Paul Robinson, a director of recruitment and HR services company Randstad New Zealand, said that although the unemployment rate had risen marginally, the number of employed people for the quarter had increased by 5000. That was a likely trend for the next quarter.

From July to September, he had noticed an increase in job advertisements as well as a need for good-quality candidates and skilled workers, he said.

"There is certainly demand out there. Talking to businesses on a daily basis, there is a lot of positive sentiment about ... their intentions to hire new staff. We just need to see this translated into real action," he said.

ASB economist Jane Turner said that for the Reserve Bank, there were some encouraging signs within the third-quarter survey, despite the disappointing headline.

"We continue to expect the Reserve Bank to lift the OCR in March. However, for the time being, the European sovereign debt crisis remains the main focus for the bank."

The ongoing political drama in Europe saw the risks increasingly skewed to a later and more gradual tightening cycle, Ms Turner said.

The imminent results of the Greek vote of confidence in its prime minister and its referendum on the euro in December could derail attempts to contain the crisis but could be educational.

"We will be watching the weekend's events to see if the recent setback will be mitigated, or whether the crisis is likely to enter another period of prolonged uncertainty," Ms Turner said.

 

 

 

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