Otago and Southland have become more pessimistic about
employment, both provinces now having more pessimists than
optimists when it comes to job prospects.
The Westpac McDermott Miller Employment Confidence index,
released yesterday, shows Otago losing 2.8 points in December
to 96.2 points. Southland lost 9.6 points to be at 96.1, down
from an optimistic 105.6 points in September.
Rural New Zealand felt the brunt of falling confidence in
December, with Northland down 5.2 to 99, Waikato down 11.1 to
96.3, Gisborne-Hawkes Bay down 4.6 to 94.5 and
Nelson-Marlborough-West Coast down 3.7 to 103.3.
A reading above 100 represents more optimists than pessimists
while a reading below 100 indicates more pessimists.
In the past two years, Otago has been hit by job losses which
have included those from the Dunedin City Council-owned
Delta, the Milburn wood processing factory, the Department of
Conservation and KiwiRail.
More than 100 highly skilled jobs at Invermay remain under a
cloud as AgResearch considers sending them to either Lincoln
or Palmerston North.
Public opposition in both Otago and Southland has been strong
about reducing the presence of Invermay in the South.
Recently, Oceana Gold announced more than 100 jobs would go
from its East Otago Macraes gold-mining operation, prompting
a contractor to announce more than 40 staff would need to be
relocated to other New Zealand operations.
There remains uncertainty about jobs at the Aoraki
There were some increases, with Auckland up 1.6, Bay of
Plenty up 10.5, Taranaki-Manawatu up 2.7, Wellington up 7.7
and Canterbury up 1.9.
Unsurprisingly, Canterbury is the most optimistic about
employment with 115 points, as the earthquake rebuild gathers
Otago Chamber of Commerce chief executive John Christie said
the latest data showed clearly the different economies
running in New Zealand.
The growth in Auckland and Christchurch had not moved into
provincial New Zealand.
There were many indicators pointing to a resurgent national
economy but that was not widely felt in Otago, particularly
Chamber members were still feeling a squeeze on their profits
and were reluctant to take on more staff until forward orders
and increasing sales were realised, he said.
However, there were some areas in Dunedin which were starting
to hire more staff.
They included trades firms taking on extra workers, some
technology companies expanding and Fisher and Paykel
Appliances taking on a ''substantial number'' of new staff.
''But we are not seeing it across all sectors. It will come,
but it will take some time,'' Mr Christie said.
Westpac senior economist Michael Gordon said the overall
confidence index rose slightly in the December quarter to a
''mildly optimistic'' 103.4.
It was the second-highest reading of the last two years,
although it remained at very subdued levels compared with the
''The relatively low level of the index fits with the
observation that while the New Zealand economy is gathering a
substantial head of steam over 2013, it had yet to reach its
Some of the ongoing caution around labour market conditions
could be traced to those already in work, he said.
Recent earnings growth had been subdued and expectations for
future earnings growth had been trending lower in recent
Low inflation tended to be followed by low wage growth.
While inflation was now starting to track higher, the fact it
fell to a 14-year low during 2013 was likely to have been
reflected in recent pay negotiations, and could continue to
do so into the near future, Mr Gordon said.
''Fortunately, there are signs conditions are gradually
improving for job seekers. The rise in perceived job
opportunities in the latest confidence index is consistent
with a swathe of other indicators.''
Business surveys showed firms' employment intentions were at
their highest in years, online job advertisements were up 15%
on a year earlier and the number of people receiving the job
seeker support benefit had fallen 5% in the last year.
Together, those indicators provided more confidence the
unemployment rate would finally break below its
post-recession range of 6% to 7%, Mr Gordon said.
Within the index's five component series, households'
perceptions of current job opportunities saw the biggest
improvement, rising from a net -51.9% to -49.5%.
That was the least negative reading since December 2008.
Expectations for job opportunities a year from now rose from
-5.8% to -3.4%.
The net percentage reporting rising earnings rose for the
sixth quarter in a row to 28%.
The net percentage expecting earnings to rise in the coming
year fell from 32.6% to 29.3%, the lowest since June 2012.
Respondents' expectations for their own job security fell for
a second quarter to a net 10% optimistic.
The survey was conducted between December 1-10 with a sample
size of 1569.