Employment confidence has lifted to its highest level since
the recession and global financial crisis of 2008-09.
The Westpac McDermott Miller employment confidence index rose
five points to 108.4 in the March quarter.
Otago has posted a seven-point increase in confidence from
96.2 in the December quarter to 103.2.
Westpac senior economist Michael Gordon said there had been a
particularly strong rise in perceptions of current job
opportunities, which chimed with other indications that firms
were ''back in hiring mode''.
There was also a gradual boost in the number of workers
reporting a rise in earnings.
That was yet to show up in a meaningful way in the official
measures of wage growth, but that divergence could only last
for so long, Mr Gordon said.
''Evidence of a wage-price spiral, or lack of one, will be an
important indicator of how far the Reserve Bank will need to
go in its just-launched campaign to keep inflation in
check,'' he said.
The latest survey also demonstrated how the upturn had become
more broad-based over the past year or so.
In the March 2013 survey, Auckland and Canterbury were the
only regions reporting net optimism.
Today, most regions have been reporting stronger labour
market conditions, and even with the impetus of the
postearthquake Christchurch rebuild, the Canterbury region no
longer came across as an outlier.
While the labour market was joining in the economy's general
upturn after a substantial delay, conditions remained
markedly weaker than they were before the recession.
Job seekers remained understandably cautious about the pace
Meanwhile, ANZ's Business Outlook showed general business
confidence fell to 67.3 in March, having reached a 20-year
high of 70.8 in February.
There were still elevated levels of confidence and there
remained ''much to smile about'' for businesses, ANZ chief
economist Cameron Bagrie said.
''Commodity prices are strong, construction activity is
moving up, there are more people on the ground courtesy of
booming net immigration, and the economy has that feel-good
factor all round,'' Mr Bagrie said.
With the economy now firmly into an economic expansion and
interest rates on the ascent, the challenge was to settle
into a ''glide-path''.
''We're after an enduring economic expansion as opposed to
being left gasping by a flash-in-the-pan growth spurt,'' he
An uplift in productivity growth was needed to build the
economy's ''muscle'' and alleviate capacity constraints.