Region’s jobless rate rises to 5.1%

FIGURES show unemployment in Otago increased in the last quarter but the region’s rate of joblessness is below the national average.

Unemployment nationwide rose to 5.3% in the September quarter, whereas for Otago it went from 4.6% in the June quarter to 5.1% in the September quarter.

Otago’s underutilisation rate, which includes people who are unemployed, looking for work or in parttime work, was 15.4 %, whereas nationally that figure was 13.2%.

In Southland the unemployment rate was 4.1% and the underutilisation rate 12.7%.

In the September quarter, the seasonally adjusted number of unemployed people nationally rose by 37,000 to reach 151,000, as the impact of Covid19 hit the labour market, Stats NZ said.

This 37,000 rise is the largest quarterly rise in unemployment since the series began in 1986.

It was still lower than many economists expected and New Zealand’s unemployment rate is lower than Australia’s, which is 6.9%.

University of Otago economics senior lecturer Dennis Wesselbaum said the jump in unemployment was expected, and he was surprised it was not higher.

Some of the people he had expected would be unemployed had kept their jobs but were working fewer hours.

‘‘That helped statistically [and meant] the unemployment rate doesn’t increase by even more.

‘‘We do have to remember that the GDP rate dropped by . . . 12% in the last quarter. Unemployment up by a bit more than 1%. While it’s obviously never good to have higher unemployment, I would have expected worse.’’

It was important to remember the figures were for the previous quarter and many people might have lost their job but had been hired elsewhere, he said.

‘‘Let’s say . . . we could measure unemployment on the day, then in lockdown we would have seen unemployment respond more. But since we’re doing it on a quarterly basis, there is a lot of people losing jobs and finding jobs, so . . . it masks some of the stuff that goes on.’’

The wage subsidy helped a lot to stop unemployment rising more, particularly in Otago.

‘‘That should have insulated the region from a larger drop. That seems to be the only valid reason . . . we’re below the national average.’’

The wage subsidy was finished and the next tranches of unemployment figures out in December and March might start to show unemployment was rising, Dr Wesselbaum said.

Otago Southland Employers’ Association chief executive Virginia Nicholls said the rise in unemployment should be no surprise.

‘‘It’s unfortunate that the largest increase in unemployment is among young people,’’ she said, adding unemployment was rising sharply among women, Maori and Pasifika.