NZ Unemployment Rises: Jobs Growth in Hospitality & Part-Time Work Trends
- New Zealand’s labour market is presenting a complex picture, with a rising unemployment rate masking sectoral disparities and a notable shift towards part-time employment.
- However, a deeper dive into the data reveals a more nuanced story.
- Brad Olsen, chief executive at Infometrics, highlighted this trend, noting that while full-time roles were down 0.9 percent year-on-year, part-time positions increased by 2.1 percent, or 11,400 jobs.
New Zealand’s labour market is presenting a complex picture, with a rising unemployment rate masking sectoral disparities and a notable shift towards part-time employment. The national unemployment rate reached 5.4 percent, the highest level since , with 165,000 New Zealanders out of work – an increase of 4,000 in the latest quarter and 10,000 year-on-year.
However, a deeper dive into the data reveals a more nuanced story. While the overall number of filled jobs decreased 1.2 percent year-on-year in , the number of part-time positions is increasing, offsetting some of the decline in full-time roles. Nationally, around 20 percent of employees now work part-time.
Brad Olsen, chief executive at Infometrics, highlighted this trend, noting that while full-time roles were down 0.9 percent year-on-year, part-time positions increased by 2.1 percent, or 11,400 jobs. This suggests businesses are cautiously adding capacity without committing to full-time employment, a sign of “slight tentativeness” in the economy.
Sectoral Divergence
The accommodation and food services sector has experienced the most significant growth, adding over 25,000 jobs in the past year, with approximately 17,000 full-time and 8,000 part-time roles. This rebound is linked to a recovery in tourism, which is now above 90 percent of pre-pandemic levels. The sector’s growth appears broad-based, with increases in both full-time and part-time work.
Retail, health, and information, media and telecommunications also saw growth in part-time employment. Retail experienced a net loss of 400 jobs but this was comprised of 4,100 fewer full-time roles offset by 3,700 more part-time positions. The health sector added 7,000 jobs but this was largely driven by an increase of nearly 10,000 part-time roles, while full-time positions decreased by around 3,000, likely due to budgetary constraints.
Conversely, manufacturing, construction, and some transport activities experienced job losses. Manufacturing saw a decrease of 7,000 roles in compared to the previous year, driven by a drop of 7,300 full-time positions. Construction has been particularly hard hit, with an overall decline of 8.4 percent, including an 11 percent decrease in part-time work and an 8.2 percent decrease in full-time positions.
Longer-Term Trends and Outlook
Looking ahead to , forecasts suggest an average annual increase of 47,000 workers, with employment expected to grow by 1.8 percent annually. However, the current trends suggest a potential shift in the composition of that growth, with part-time roles continuing to play a significant role.
Olsen suggests that the construction sector may not return to its previous employment peaks, as activity levels are likely to remain below previous highs. He anticipates a transition in other industries from a focus on part-time work to more full-time positions as economic conditions improve, but businesses remain cautious and will likely wait for stronger sales and activity before committing to permanent hires.
The increase in part-time work may also reflect changing consumer spending patterns. While retail employment has declined slightly, spending on groceries and dining out appears to be increasing, potentially contributing to the growth in part-time roles in the accommodation and food services sector. Consumers appear to be prioritizing experiences and necessities over discretionary purchases.
Data from also revealed the impact of the weak labour market on younger workers. Individuals aged 15 to 19 experienced a 10 percent decrease in employment, while those aged 20 to 24 and 25 to 29 saw declines of 3.5 percent and 3.9 percent, respectively. This suggests that young people are disproportionately affected by the current economic conditions, facing challenges in securing employment even with qualifications and experience.
The labour market data underscores a period of transition and uncertainty. While the overall unemployment rate is rising, the growth in part-time employment and the sectoral variations suggest a more complex dynamic than the headline figure indicates. Businesses appear to be adopting a cautious approach to hiring, and the future composition of employment growth remains to be seen.