Unemployment Rate Falls to 3.6 Percent

11 February 2005

Household Labour Force Survey: December 2004 quarter —

Unemployment Rate Falls to 3.6 Percent

The seasonally adjusted Household Labour Force Survey (HLFS) results for the December 2004 quarter show a continuation of the labour market strength observed in recent quarters, Statistics New Zealand said today. There was strong employment growth of 1.6 percent and growth of 1.7 percent in total actual hours worked. This was accompanied by an increase in the labour force participation rate to 67.7 percent and a fall in the unemployment rate to 3.6 percent.

The labour force grew strongly over the quarter, increasing by 30,000. This growth was partly fuelled by an increase of 12,700 in the working-age population, but it was also influenced by a fall in the number of people who were not in the labour force. The large labour force growth, relative to the increase in the working-age population, resulted in a strong increase in the labour force participation rate to a record high level.

The growth in the number of people employed in the quarter (33,000) exceeded the growth in the total labour force, which meant that the number of unemployed people continued to decline in line with falls in recent quarters. This, combined with the labour force growth, has caused the unemployment rate to fall to the lowest it has been since the survey began in March 1986.

The strong demand for labour continued to increase over the December 2004 quarter, not only absorbing the growth in the working-age population, but also drawing from the existing groups of the unemployed and those not in the labour force.

Over the year to December 2004, unadjusted unemployment rates have fallen for the European/Päkehä, Maori, Pacific peoples and 'Other' ethnic groups.

Unadjusted unemployment rates in the December 2004 quarter stood at 8.9 percent for Mäori, 6.5 percent for Pacific peoples, 6.5 percent for the 'Other' ethnic group, and 2.3 percent for the European/Päkehä ethnic group.

Brian Pink

Government Statistician

ENDS

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