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Statistics New Zealand figures released yesterday show Otago had an unemployment rate of 4.6% in March, up from 4.4% in December but down from 4.8% in September.
In March last year, Otago's unemployment rate was 5.4%.
Southland had a significant fall in unemployment, to 4.7% in March compared with 5.7% in December and 5.4% in September.
In March last year, Southland's unemployment rate was 4.9%.
Otago has a workforce participation rate of 71.3% and Southland's rate is 72.3%. All figures are seasonally unadjusted.
Canterbury, as expected, had the lowest unemployment rate of the South Island at 3.3% as the rebuild continues to soak up spare workers.
The Government this week announced a ''$3k for Christchurch'' scheme under which $3.5 million will be spent trying to lure beneficiaries to take up jobs in the damaged city for a one-off payment of $3000.
Mr Scandrett said in an interview Otago and Southland's unemployment rates were at the lower end of the range compared with some North Island regions.
''I'm contented by that outcome. It seems employers here are making an effort to hold on to good staff. That is supported by salaries and other benefits being offered.''
Recently, Mr Scandrett ran an ''unofficial ruler'' over the region's manufacturing and services industries' data which showed Otago and Southland rated highly in most measures.
Taken in isolation, the figures could lead to scepticism. But together, the signals were aligning, he said.
General feedback received from association members showed optimism for the future and Mr Scandrett believed the current trends would continue throughout the year.