Bulletin article discusses New Zealand labour force participation developments
An article published today in the Reserve Bank Bulletin compares labour supply developments across the OECD and examines
how New Zealand is placed.
Labour supply is the largest input to New Zealand’s productive capacity and is an important element of any good or
service. However, the outcomes of labour markets are complex. In recent years, New Zealand has experienced rapid labour
supply growth, coupled with a record-high labour force participation rate in 2017.
This article, by Jamie Culling and former Reserve Bank economist Hayden Skilling, delves into the details of labour
supply to understand the recent developments in New Zealand. This experience is then put into context by comparing
developments across the OECD since 2000.
The authors propose that New Zealand’s large growth in the labour force is due to strong population growth coupled with
increased participation from older individuals and women. New Zealand has had a similar experience to the OECD regarding
population ageing and participation by women. However, participation by older individuals in New Zealand has outstripped
that of the OECD.