Are we beginning to see signs of economic recovery?

The latest unemployment figures bring some glimmers of hope that we may be turning a corner....

The latest figures from Stats NZ show that the unemployment rate remained steady over the first quarter of the year, at 5.1%.

It had been predicted that the level might rise further during this year’s first quarter to around 5.3%, but that hasn’t happened.

The number of people in full-time employment has dropped by 45,000 over the year, while the number in part-time employment has risen. Around 20% of employed people are currently working part-time.

It’s not clear exactly what is driving this change. But, the Household Labour Force Survey found that among both full-time and part-time workers, the percentage of people wanting to work more hours had risen up 11.9% year-on-year, suggesting that people would rather be working more if they could and that part-time work is being driven by available options rather than personal choice.

So things still don’t look great, but the fact that the rate hasn’t changed and hasn’t reached the predicted peak of 5.3% may be a sign that we are turning the corner when it comes to the economy. The other encouraging sign was that wages increased slightly, with wage growth at around 2.9% in the year to March, compared to a 2.5% rise in inflation. Wages across the public sector rose more than in the private sector during that period.

Shamubeel Eaqub, Chief Economist at Simplicity, notes that the lows in this current recession cycle are not as bad as in the last big recession, the Global Financial Crisis in 2008. During that period, there were 59,000 job losses at the low point. This time round, losses are at 33,000.

Young people (aged between 15 and 29) have been particularly affected by job losses or the unavailability of jobs, while older people are more likely to be employed, with the number of people employed in the 29-35 and 65+ age brackets increasing.

Eaqub says he’ll be happier when he sees more jobs being advertised. That isn’t happening quite yet, he says, with businesses still holding on to staff they already have.

Infometrics economist Matthew Allman also believes it might not be until later this year or early next year before those lost jobs would be recovered

At Do Good Jobs, we are beginning to see signs of those vacancies coming back. Listing numbers are improving on last year, but are still variable, with some weeks seeing few roles being advertised and others bringing flurries of jobs. What’s encouraging is that we are beginning to see more ads for newly created roles, suggesting that some organisations are beginning to focus on expansion or new areas rather than simply sticking with what they have. We’re looking forward to seeing continued increases in job numbers as the year goes on.