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Labour market trends: what we know…

How a country’s labour market performs has a huge bearing on its overall productivity and wellbeing.

9 March 2019

In recent decades, New Zealand’s labour market has seen some significant changes, including to the make-up of the workforce, and the nature of work performed. The Productivity Commission has been analysing some of these trends in preparation for its new inquiry on Technological Disruption and the Future of Work.

New Zealand has relatively high labour participation and low unemployment

A high proportion of New Zealanders participate in the workforce compared with other OECD countries. Overall participation in the labour force has increased substantially since the late 1980s (see Figure 1 above).

New Zealand’s unemployment rate currently sits at just over 4%, after peaking in the early 1990s and subsequently declining. Across the country, unemployment rates differ considerably. Higher rates in regions such as Gisborne and Northland have persisted. There are also large disparities between ethnic groups – Māori and Pacific peoples experience much higher levels of unemployment. Young workers and less-educated workers also face higher unemployment. Further analysis is needed to better understand the dynamics between ethnic, regional, education and age disparities in unemployment.

Figure 2 New Zealand’s unemployment rate, 1987-2018

Figure 2

Source: Stats NZ

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