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As Otago struggles with layoffs and reduced hours for manufacturing workers, the region's unemployment rate continues to climb, rising 37% in the year to June.
At the end of June, Otago had an unemployment rate of 6.3%, 17% above the 5.4% March figure but 37% ahead of the 4.6% recorded in June last year.
Because the figures are not seasonally adjusted, Statistics New Zealand advises annual comparisons to be taken, making the reading much gloomier.
In June 2011, Otago had a 5.3% unemployment rate.
On Saturday, Economic Development Minister Steven Joyce defended the Government's involvement in the region, pointing out that unemployment at the end of March in Otago was 5.4% against a national figure of 6.2%.
At that stage, Otago had the fourth-lowest rate of unemployment in the country.
Mr Joyce also provided a list of projects in the region with which the Government was involved.
Figures released yesterday showed Otago had the highest unemployment rate in the South Island.
Labour Party regional development spokesman David Clark said: ''Steven Joyce is talking a big game, but out in the real world, Otago numbers are the highest for at least five years.''
In recent days, AgResearch had announced it was shifting 85 jobs at Invermay to either Lincoln or Palmerston North and Bradken was putting 64 of its manufacturing workers on reduced time, following KiwiRail's decision to award a manufacturing tender offshore.
As well, 73 jobs will be lost from New Zealand Post.
Dr Clark said there had been many cuts across government departments in the South and that showed the Government did not value the economic contribution made by the regions.
The Government already had tools at its disposal to halt the decline in regions across New Zealand through its procurement policy.
But instead of buying New Zealand-made, it was fixated on getting low prices from overseas, at the expense of jobs.
Dr Clark quoted a paragraph from Mr Joyce when he launched a report into the economic performance of New Zealand's 16 regions.
The minister said: ''For businesses to succeed they need to be able to make the most of their local resources, both physical and human.
"They need public institutions that make sound infrastructure investment decisions, administer fit-for-purpose regulation and provide services that improve local circumstances''.
Dr Clark said the core of public services would always remain in Wellington, but Labour would look at ways of building on expertise and synergies within regions.
Science and Innovation, now part of the Ministry for Business, Innovation and Employment, was a natural fit with the University of Otago which had an ''outstanding'' reputation for research, year after year, he said.
Statistics NZ figures showed that at the end of June this year, Canterbury had an unemployment rate of 4.4%, up slightly on March but down substantially on the 6.5% at the corresponding time last year.
Southland had an unemployment rate of 4.9%, up 53% on March and up slightly on June of last year.
Nelson-Tasman-Marlborough-West Coast had an unemployment rate of 4.2%, down on both March and June 2012.