Unemployment in Queenstown soared in the last six months of 2009 to levels not seen since 2003, but has been dropping steadily in the past couple of weeks.
Work and Income regional director Sue Rissman said unemployment in Queenstown was significantly higher last month than in previous Decembers.
Figures show 109 people were receiving a benefit in December, whereas just eight were on the books in May.
"The higher number of unemployed can be directly attributed to the recession. However, in the first weeks of January, the area is experiencing a steady decline in unemployment," she said.
The major factor for the improvement was an increase in job vacancies.
"Work and Income has 45 job vacancies. In addition, there are dozens of jobs being advertised locally and on national job websites.
"The hospitality industry is looking for workers, and construction seems steady," she said.
Staff were working intensively with clients to assist them into work or training.
Last May, the official number of unemployed people in Queenstown had risen to eight, up from fewer than five three months before.
Only one person was registered as unemployed in May 2008.
The figures had shown a steady decline in unemployment benefit claims from a peak in August 2003, when 127 people were on the dole.
The number of claims ranged between 26 and 72 in 2004, then dipped to between 13 and 29 claims in 2005, eight and 17 in 2006 and between one and eight in 2007.
However, employment agencies say the Queenstown job market is buoyant, despite the higher unemployment rates.
Queenstown and Wanaka Job Agency owner Jethro Robinson said the job market in Queenstown was "very strong".
"Queenstown is looking healthy. There are jobs for workers and people to fill them so it's very buoyant considering there's a recession," he said.
All job sectors were strong including hospitality, construction and administration.
"It's been a pleasant surprise. The job market is much stronger than expected and much stronger than in other areas," he said.
Wanaka was having a "very quiet" summer compared with previous years.
Wanaka-based workers as well as backpackers and seasonal workers were moving to Queenstown where they were finding work more easily than in Wanaka. In spite of the high number of people without work, Queenstown is still attracting overseas workers.
Department of Labour spokesman Rowan Saker said a scheme was under way to attract more holidaymakers to take a working holiday in Queenstown.
The Immigration New Zealand Queenstown hospitality pilot scheme was launched in December and would run until the end of next month.
Mr Saker said the scheme was aimed at helping employers advertise jobs and find working holidaymakers who were already skilled in hospitality.
Of the more than 300 employers who were invited to take part, 38 had registered 145 jobs.
"These job opportunities were emailed to 1136 people who had registered a specific interest in working in Queenstown.
"Jobs and employer contact details were listed on a specific working holiday Queenstown page on the newzealandnow.govt.nz website," he said.
About 10% (111 people) of those who received the email clicked through to see the Queenstown employer page.
The scheme would be evaluated after it finished in February to see if it had had positive results, Mr Saker said.
And where no suitable New Zealand citizens or residents were available or could be trained to do the work on offer, Immigration New Zealand was also granting work permits under the essential skills policy.
Mr Saker said the volume of work permit applications received in the Queenstown branch between July 1 and December 30 was about 10% lower than for the corresponding period in 2008.
About 960 work permits had been approved by the Queenstown branch between October 1, 2009, and January 15, 2010.
Nationally,
• Work and Income receives around about 1000 new job vacancies each week.
• One in three people seeking support from Work and Income do not go on to a benefit.
• In December 2008, 1772 people came off the unemployment benefit and began working.
• In December 2009, 3810 people came off the unemployment benefit and found work.
