Jobless rate may climb up to 7%

New Zealand's unemployment rate is forecast to push back up to around 7% within the next six months as job advertisements carried in newspapers and online sites fall.

The ANZ Job Ads series, which combines newspaper and online job advertisements, fell 1.7% in May, more than undoing the gains of the past two months.

ANZ senior economist Sharon Zollner said the tentative upward trend in advertising had been snuffed out.

The monthly fall was driven by a 7.2% fall in newspaper job advertising, giving up the April rise. The number of internet job advertisements fell by 0.7%, its second small fall. The level of the series remained ''respectable'' given strong gains in February and March, but regional numbers were volatile, she said.

''Job ads in Canterbury appear to be losing some steam, whereas Wellington newspaper job ads are showing surprising resilience. Newspaper job ads in Auckland fell, but internet advertising bounced back somewhat.''

Newspaper advertising rose in Waikato, but fell in Hawkes Bay, Manawatu and Otago. The Otago Daily Times contributes to the series.

For a longer historical perspective, the ANZ calculated a ''composite'' weighted job ads series which gave newspaper advertising a larger weighting of five to one. Ms Zollner said the composite measure fell 3.8% in May after rising 3.3% in March.

The annual change in the three-month average had again started losing ground, predicting that in the next six months there would be a small rise in unemployment versus the previous 12 months.

''Given the unemployment rate averaged a touch over 7% in the middle quarter of 2012, this would be consistent with a sharp recoil in the unemployment rate from the current 6.2% back up towards 7%.''

The labour market remained the missing ingredient for a national sustained economic upturn, she said.

Both the ANZ and the Reserve Bank were forecasting an improvement in labour market results over the rest of the year but job advertising was yet to back that up.

''Like the rest of the economy, labour market outcomes remain disparate across regions and sectors,'' Ms Zollner said.

 

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