While I’m asking you questions about your own experience, how does your own experience gibe with the “seasonally adjusted” unemployment figures released yesterday showing an unprecedented and frankly enormous drop in unemployment from 7.1% to 6.0%, a drop of 25,000 (from 165,000 to 140,000).
They’d be great news all round if true—but they’ve also been greeted with surprise by many people; and we do know too that the figures are based on surveys, not on raw figures, and that the government departments involved in collecting and calculating the figures have made mistakes with their maths before. So given this is the largest drop ever in reporting these figures, and that these figures are used by central planners to play around with us (Alan Bollard, for instance, was heard gargling loudly yesterday) there are grounds at least for caution in accepting the figure as real, don’t you think?
So to at least begin measuring the credibility of the figure (and because what we each see in our own business is what we really base business decisions on), how does your own day-to-day experience fit with the figures?
Does what you’ve seen tend to support what the figures say? Or vice versa?
UPDATE 1: Matt Nolan comments at The Visible Hand:
“Labour market improving rapidly. But still weak.”
Yes the labour market is recovering incredibly rapidly. Yes the labour market is still weak…
The labour market data is strong than expected, but it is a very backwards looking indicator. It appears that workers have been willing to take lower wages to get back in the labour market…
I’d take this as a sign that our labour market is more dynamic, robust, and flexible than I’d previously realised. That is good. But it doesn’t mean the NZ economy is on the verge of taking off.
UPDATE 2: Lindsay Mitchell kindly sent me a link to a surprisingly sane discussion of the figures with Ganesh Nana of BERL (and I say surprisingly sane because Nana’s BERL is responsible for the fantasy figures used by the Law Commission in their campaign for alcohol wowserism; and for nonsense like the economically bereft claims for building KiwiRail units locally).
Anyway, click here for the audio.
And Lindsay herself observes that unemployment figures quoted are for what’s called the Household Labour Force Survey, “which has its limitations being based on a sample survey. The figure may yet be revised. (The December figure was revised from 7.3 to 7.1).
“[Meanwhile, the actual] unemployment benefit numbers dropped from 66,328 at the end of Dec 09 to 60,211 at the end of March 2010. [A drop of just 6,117.] Yet 1.1 percent of the labour force represents something like 24,000. I am still waiting for the data that will show many people went off the dole and onto a student allowance … “
So, in a nutshell, the 'official' unemployment rate doesn't fill Lindsay with optimism either. How about you?
7 comments:
There is a strong suspicion that the December figure is a little messed up - so anyone calling it the "largest fall on record" is probably a little of the mark I agree.
Also I wouldn't call the figures great per see, 6% unemployment is still a rate that implies there is slack in the labour market.
One thing I would note is that wage growth has collapsed and employment has picked up - this tells me that the labour market is clearing. One of the good things about the lack of unionisation IMO.
I try to put some of the stuff in context here if it helps:
http://www.tvhe.co.nz/2010/05/06/labour-market-improving-rapidly-but-still-weak/
A few anecdotes from my world:
- I am self employed and lease out a serviced office in the Christchurch CBD. There are 15 offices. Current occoupation rate is about 45%, though from what I hear 1-2 years ago it was close to 100%.
- My main client has just implemented a round of redundancies for their own staff.
- Most civil engineering consultancies and contractors I deal with are reporting that future work prospects are not good - and with one exception are more likely considering laying off people than taking more on.
Based on all the building for lease signs around Auckland I would love to know where these people are working.
I'm still unemployed, so I haven't noticed it. Maybe it is all hype.
Must be a rort. Still lots of bludgers on benefits so I guess that's what's keeping the figure down.
Based on all the building for lease signs around Auckland I would love to know where these people are working.
Wellington.
If we were preparing for a "step change" in the economy - this would need to be up around 10%, more like 15%. It's not - purely because of a continuation of Helen's economy-buggering policies
Back from the dead -- aka a much-enjoyed hiatus.
Is there anything to crow about?
No. It's bullshit.
www.libertarianz.org/soundbites
Close to home. Here is the BOP local reading of the situation.
I note also that the return to education is up something like 20% on last year.
Each day and anything up to 6 or 8 times,I drive around the corner on which the Winz building is and I can say from my observations that the queues are longer than ever even though this is kiwifruit time when there is usually no benefits to be had in this area.
It is also worth noting that this year there has been not one call for workers to be imported to pick fruit anywhere in the country. Now that's the first time for many years.
http://www.bayofplentytimes.co.nz/local/news/bay-bucks-trend-with-jobless-rate-hitting-8pc/3913683/
Bay bucks trend with jobless rate hitting 8pc
Kiri Gillespie | 7th May 2010
Chamber of Commerce
The Bay of Plenty is one of the only regions in New Zealand to experience a rise in unemployment since Christmas, with latest figures showing the region's unemployment rate jumping to 8 per cent - the highest in years.
A Household Labour Force Survey released yesterday showed a national fall in unemployment.
However, the Bay of Plenty experienced an increase, with unemployment rising from 7.4 per cent in December. The rate was 6.1 per cent 12 months ago. In March 2008, the figure was 5.2 per ce
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