New Zealand Unemployment Q2 2020

New Zealand

New Zealand: Unemployment dips as people stop looking for a job in Q2

August 5, 2020

The seasonally-adjusted unemployment rate unexpectedly fell to 4.0% in Q2 from 4.2% in the previous quarter. The reading was notably below market expectations of a 5.8% unemployment rate, and reflected a drop in people actively looking for a job amid the fallout of the pandemic and government-funded wage subsidy schemes.

Meanwhile, the underutilization rate—which includes both unemployment and underemployment—climbed from 10.4% in Q1 to 12.0% in Q2, marking the largest quarterly rise on record and signaling a sustained increase in the labor market’s untapped capacity. Moreover, hours worked fell by a record-breaking 10.3%, while private sector wages rose a timid 0.2% in Q2 on a quarter-on-quarter basis, marginally down from Q1’s already subdued 0.3% upturn.

FocusEconomics panelists expect the unemployment rate to average 7.4% in 2020, which is unchanged from last month’s forecast, and 7.3% in 2021.

Author: Massimo Bassetti, Senior Economist

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New Zealand Unemployment Chart

New Zealand Unemployment Q2  20 20

Note: Quarter-on-quarter seasonally adjusted and annual variation of retail sales in %.
Source: Statistics New Zealand and FocusEconomics calculations.

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