Unemployment rate ticks up ahead of expected recession

Wed, Feb 1
Meanwhile, wages have increased from 3.4% to 3.7%, according to Stats NZ.

The unemployment rate ticked up to 3.4% in the December quarter, according to the latest figures from Stats NZ.

Last quarter's official unemployment rate was 3.3%.

Today's figure is higher than expectations from some economists.

ASB and ANZ economists had tipped the official unemployment rate would return to a record low of 3.2% - as seen early last year.

Stats NZ work and wellbeing statistics senior manager Becky Collett said the unemployment rate still remained around historic lows.

"The unemployment rate, as measured by the Household Labour Force Survey, has remained at or near historic lows since the September 2021 quarter," he said.

Meanwhile, the labour cost index (LCI) has seen its largest annual increase since the measure began in 1992.

"All salary and wage rates (including overtime), as measured in the labour cost index (LCI), increased 4.1%, compared with 3.7% in the year to the September 2022 quarter.

"The LCI is often compared with the consumers price index (CPI). This shows how wage cost inflation for businesses compares with consumer inflation (that is, the change in prices of goods and services bought by households)," Stats NZ said.

The underutilisation rate - a broader measure of spare labour capacity which includes those unemployed, underemployed, and the potential labour force - rose to 9.4%, from 9.0% last quarter.

"The primary contribution to higher underutilisation came from increases in the potential labour force."