Unemployment lowest since records began

[MotherBear]

Unemployment hits lowest point since records started
5:00AM Friday November 09, 2007
By Brian Fallow

The number of people employed dropped by 7000, 0.3 per cent, in the September quarter but the labour market remains very tight.

The number of unemployed also fell, by 2000, pulling the unemployment rate down to 3.5 per cent - the lowest since comparable records began 22 years ago - from 3.6 per cent in June, Statistics New Zealand said. It has been below 4 per cent for three years.

The apparent anomaly of employment and unemployment both falling arises because of a drop in the labour force participation rate. It fell to 68.3 per cent, the result of an 18,000 increase in the number of working-age people who are neither employed nor actively seeking work, which is a requirement of being counted as unemployed.

The participation rate remains high by historical standards. It tends to rise and fall with the demand for labour, ASB economist Daniel Wills said.

"When firms are hiring, people in the working age population will make themselves available for work. If jobs are harder to come by, the converse applies."

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