NZ: Employment growth to remain firm – Westpac

Satish Ranchhod, Senior Economist at Westpac, suggests that the New Zealand economy is now in its seventh year of continued expansion and while they do face some challenges, the outlook continues to look pretty healthy.

Key Quotes

“We expect this will be reflected in the suite of labour market indicators for the March quarter, due for release on Wednesday 3 May.”

“We expect the Household Labour Force Survey (HLFS) will show that employment levels increased by a solid 0.8% in March quarter, with gains being supported by firm economic conditions as well as strong population growth. Increases in employment are expected to be widespread, with the largest gains expected in service sectors (such as professional services) and construction. These sectors have been key drivers of GDP growth, and businesses in these sectors have reported that they have continued to increase staff numbers in recent months.”

“Methodological changes last year have clouded the interpretation of the HLFS data. In particular, it’s not clear whether the increased coverage of the survey will affect the seasonally adjusted estimates of quarterly jobs growth. As a cross check, we’ll be watching the Quarterly Employment Survey (QES) which will be released at the same time. We expect that it will show that the number of full-time equivalent employees grew by 0.7% in the March quarter, to be 2.9% higher for the year - consistent with an economy growing at a firm pace.”