New Zealand’s unemployment rate is expected to reach 5.1% for the December quarter, marking a four-year high as the job market continues to feel the effects of a slow economy.
Despite signs of economic recovery, the labour market lags behind, with an estimated 30,000 jobs lost over the past year due to government restructuring and industrial layoffs.
A drop in job advertisements and some young workers opting for further education instead of job-hunting have cushioned a sharper rise in unemployment.
Meanwhile, wage growth has slowed to around 3%, a stark contrast to the ‘pandemic’-driven increases, as job security now outweighs salary demands.
Economists predict a slow recovery until lower interest rates boost household confidence and spending and business activity, with the Reserve Bank expected to cut the official cash rate to 3.75% this month.
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