The NZ Employment numbers for 2Q have just been released.

They came in considerably better than expected:

NZ Employment data for 2Q was:

- Employment (Q/Q) -0.4% (consensus -2.0%)
- Employment (Y/Y) +1.2% (consensus -1.2%)
- Unemployment Rate 4.0% (consensus 5.6%)
- Participation Rate 69.7% (consensus 69.7%)

In addition, Average Ordinary Time Wages were +0.4% (+0.5% expected)

1Q numbers have also been positively revised.

The phase “lies, damned lies, and statistics” springs to mind on seeing the quarterly employment numbers. Delving into the numbers, Stats NZ stated the unemployment rate fell because people who were not actively seeking work were not counted as unemployed.

However, Underutilisation – a broader measure of spare capacity in the labour market – and hours worked provide a more detailed picture of New Zealand’s labour market than the unemployment rate alone. This quarter, underutilisation rose from 10.4% to 12.0% – the largest quarterly rise since the series began, while hours worked were down by over 10 percent – another record. This, I suggest, presents a more complete and accurate picture of the state of the labour markets than the unemployment rate headline.

The NZD traded a little higher in immediate response.

Link to the Statistic NZ press release:

https://www.stats.govt.nz/news/covid-19-lockdown-has-widespread-effects-on-labour-market

Current indicative levels are:

NZD-USD 0.6625 / 0.6650
NZD-AUD 0.9260 / 0.9285
NZD-EUR 0.5615 / 0.5640
NZD-GBP 0.5065 / 0.5090
NZD-JPY 70.10 / 70.35

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