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Employment numbers have both good and bad news

Written By: - Date published: 4:04 pm, February 5th, 2009 - 23 comments
Categories: workers' rights - Tags:

The new employment data for the December quarter are out and they’re surprising reading. Now, the media will grab hold of the headline unemployment figure. At 4.6%, it’s up from 4.2% in the September quarter and brings the number of unemployed over 100,000 for the first time since 2003, which is about what everyone expected. But what you have to understand is that’s a bit like asking how empty a glass is – it may be mildly interesting but it doesn’t tell you how much water you’ve got to drink. For that, you have to know the size of the glass or, in the case of employment, you need to look at the number of people looking for work as well as the number employed and the number of hours worked.

And that’s where these figures are surprising. The number of people participating in the labour force actually grew quite rapidly in the December Quarter, mostly due to more people starting to look for work. Labour-force participation rose 0.6% to 69.3%, just about the highest rate on record. The labour force grew by 31,000 to a record 2,296,000, which is not what we usually expect in a recession; usually, people drop out of the labour market, returning to study or retiring early for example.

The upshot of that is while your basic unemployment rate number is up, so is the number of people employed. In fact, there are now a record 2,190,000 people employed, 21,000 or 0.9% more than the September Quarter (note these are all seasonally-adjusted numbers, so seasonal variation is not behind this growth). And that’s the first bit of good economic news we’ve had in some time.

But it’s not quite as simple as that, either. A One News report a few weeks ago said that 10,000 more people had gone on the unemployment benefit in December alone, a more than 50% increase form the low of 18,000 in August. So, more people are looking for work and more people are finding it, but there are not enough jobs for all the added people wanting work and more of those not finding work are going on the dole.

Then, there’s the hours worked figures. They’ve actually dropped, down 1.9% on the previous quarter and 2.8% on a year before. So, what we seem to be seeing is increased underemployment – more people have jobs but they don’t have as much work as they would choose because hours are being cut back. The number of people self-reporting as underemployed (got work but want more hours) jumped from 80,800 to 96,600. That’s backed up by the fact that most of the new jobs in the December quarter were part-time.

So interesting figures. It’s bad but expected that the amount of work is decreasing. It’s probably good, and unexpected, that the work there is to be had is being spread among more people, rather than the number of unemployed being even higher. On the other hand, more part-timers and casual staff means an increasingly vulnerable workforce. And, of course, this is just the beginning. Treasury is expecting another 75,000 people to be unemployed by the end of the year.

[By the way, I saw Corin Darin on One News say ‘with this increase the number on the unemployment benefit has now passed 100,000′. Moronic. The guy obviously doesn’t understand the difference between the unemployment rate, as determined by Stats’ Household Labourforce Survey, and the Unemployment Benefit. Only 30,000 are on the UB. And Darin isn’t the only one to get something so simple arse-backwards, so did this fulltime political, professional political commentator. Goddamit. If our news is that crap how can we expect the general public to be well-informed?]

(all stats from here)

[update: Brian Fallow’s piece is good and covers the same points]

23 comments on “Employment numbers have both good and bad news ”

  1. BLiP 1

    The gradual casualisation of the New Zealand workforce speeds up under National. How many more of us are going to end up on the dole scrap heap by the time the voters realise what they have done and heave the bastards out?

  2. Steve, do those figures count part time and casual workers, because that could be misleading. Is someone who is working 10 hours counted as employed????

  3. Brett. Of course they do, for fuck’s sake I mention part-time employment in the post.

  4. Don’t you think its playing around with figures to call someone employed who only works ten hours a week?

  5. Brett. Take it up with Stats. And, no, I don’t think so. Think about it for a second, what is the definition of employed? Look it up on google and stop wasting my time.

  6. Steve:

    Well stop twisting figures, you would make a good politician.

    If the National government were claiming someone as employed for working ten hours a week, you would call them on there BS.

    Yes I know they are stats NZ figures, but your using them to make the previous Government look better than they were.

  7. Brett. I’m not twisting the damn figures, they’re quoted straight from Stats.

    The number of employed people is just that. The number of people in paid work.

    But if you want to really understand what is happening you also need to look at the hours worked, which I do.

    At no point in the post do I mention either the previous government or the current one.

    You’re on the border of doing a burt and having a week off for being too dumb.

  8. Brett, not everything has to be framed in the realm of who’s party ran the show better.

    Stats NZ is rightly and necessarily apolitical to report the data to the public without spin or excuses.

    A lot of the time it’s not overly important about which statistics are reported, but that the same statistics are reported when trying to establish a trend. You (quite rightly) pick up that a particular statistic doesn’t give a proper representation of the situation, but taken in conjunction with the other statistics reported (as Steve pointed out) you can figure out what’s going on.

    Now, it’s actually in all our best interests to understand the depth and gravity of the situation at hand instead of pointless bickering.

  9. Carol 9

    How much is the increase in both unemployment figures &/or employed figures the result of people returning from overseas?

    They’re just talking about it on National Radio. hmmm… increase in numbers of women (to help pay off debt) and over 65 yr olds re-entering the workforce (taking a hit to investments and cash-rates).

  10. Im saying that the stats can give a false impression of people in work?

    Im guessing Stats New Zealand broke it down by full/part/casual.

  11. Quoth the Raven 11

    Is Colin Espiner the worst politcal commentator in the country? Political partisanship and all that aside.

  12. gargleshite 12

    Nope that honour would surely go to one of the bloggers.

  13. Quoth the Raven 13

    I should’ve said professional political commentator.

  14. gargleshite 14

    In that case quite possibly – what we are in desperate need of is political satire to return in the form of McPhail and Gadsby or spitting Image or such like – this tend to be far more accurate and entertaining than the hacks in the print media or TVv news.

  15. Rodel 15

    Crosby Textor’s advisory mantra:All Nactional MPs will utter sound bites using
    the following words:
    “..Blah….shame/ pity/ unfortunate /
    that… the previous government didn’t :
    see fit to/ bother about/ care about/ ..blah blah”
    the average New Zealander/ the health system/ the education of our kids/Maori
    the environment. (anything)
    Insert at every available speaking opportunity
    Do not say “The Labour government”-just; ” Previous government”
    Ignore evidence to the contrary
    Do not participate in challenging evidence to the contrary
    Repeat 10 times before breakfast
    Repeat mindlessly when ever a radio or TV interviewer is within 3 metres
    Practise in front of a mirror to make it sound genuine (NB don’t use big words)

  16. deemac 16

    sorry if this is a silly question, but isn’t the rise in numbers employed in Q4 a regular seasonal thing? Xmas jobs, summer holiday jobs??

  17. Well if one is going to jump up and down about the importance of accuracy the TVNZ’s reporter’s name is Corin Dann (not Corin Darin).

    If you’re going to criticise someone (be it warranted or not) at least have the decency to spell their name correctly

  18. TghtyRighty 18

    For once steve seems to have written an informative piece that is well thought out and coherent. Brett, part time and casual workers are counted as employed because they are, and splitting hairs about how many hours people work is not fair play. often part-times work is either a) all they can get or b) what works best for them. these people still contribute to the economy and should be recognized for it.

    Dee, seasonal variation in employment should have been taken into account and adjusted for by statsNZ, or they’re not doing their job properly.

    Rodel, suck balls, crosby/textor are at least a company who have to work and grind for their living, unlike the 500+ “comunication advisors” employed under the last regime.

  19. Peter Burns 19

    Did the huge numbers of parasitic communication advisers from the last regime put a surcharge on their hyperbole on Maori day? Spin doctors make me vomit over me cat called spook.

  20. Felix 20

    the 500+ “comunication advisors’ employed under the last regime.

    And presumably still employed under the current regime.

  21. ak 21

    Totally off-topic, but in case you missed it, this article might sow a wee seed in you clever young Standardistas: there’s a heap of journalistic talent rejected by the rightie paper barons now beavering away in isolated sites – whack em together in one attractive and easily-accessible package (and mix in a few cartoons, headlines etc) and you might be surprised at how many would chip in. Make it simple, chuck in some local news, and I’d ditch my expensive tory firelighting material in a nano-second. Who knows, you might even get paid one day!
    http://www.huffingtonpost.com/walter-isaacson/a-bold-old-idea-for-savin_b_164039.html

  22. MollyByGolly 22

    Brett has a point. While Statistics NZ is non-political, the last govt did change the definition of “employed”. It used to mean someone in paid work for 30 or more hours per week; in the mid-2000s this was changed to mean anyone in paid employment for ONE hour per week or more. This makes across-time comparisons (2008 cf 2003) useless unless you can break the data down by hours worked AND know whether people are happy with their level of employment.

    TghtyRighty – yes, some people choose part time work because it suits them best but it the statistics as reported here do not measure whether these people are happy with their level of employment. There is a difference between employed and under-employed.

    Statistics are not neutral. How variables are defined impact on the numbers. And you won’t find that technical detail by typing “define unemployment” on Google.

  23. Rodel 23

    TghtRighty said:

    “Rodel, suck balls, crosby/textor are at least a company who have to work and grind for their living, unlike the 500+ “comunication advisors’ employed under the last regime.”
    Was it ‘grind’ or ‘graft’?
    I’m overwhelmed by the choice of vocabulary, grammatical competence and intellectual rigor of right wing debates and also the corroboration (sorry -big word) of my original point.

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