- Satish Ranchhod, senior economist at Westpac
Unemployment rate in New Zealand declined more than expected in the third quarter, with a rate of job creation outpacing population growth, while the number of jobless people dropped as economic activity continues to strengthen. The seasonally adjusted jobless rate declined to 5.4% from 5.6%, reaching the lowest level in five years, Statistics New Zealand reported. The reading came in better than analysts' forecasts of 5.5% unemployment rate. The Kiwi economy created 18,000 jobs over the reported quarter, while only 15,000 people entered the labour force over that period, pushing up the participation rate to 69% from 68.9%. On top of that, seasonally adjusted employment rose 0.8% on the quarter compared with expectations for a 0.6% rise, and was up 3.2% on the year compared to expectations for a 3.1% rise. There were 4,000 less unemployed people in the three months through September. Growing activity in the nation's construction sector accounted for as much as half of annual job growth.
Despite strong growth in labour demand over the quarter, wage growth failed to meet expectations, with the Labor Cost Index climbing just 1.7% in the year to September. However, wage growth outpaced consumer-price inflation, which rose 1% year-on-year in the third quarter.
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