Thursday November 5, 11:43 AM
New Zealand jobless rate hits nine-year high
New Zealand's unemployment rate hit a nine year high of 6.5 percent in the September quarter as the effects of a long recession hit businesses, official figures showed Thursday.
In seasonally adjusted terms, the number of people unemployed hit a 15-year high of 150,000, Statistics New Zealand said.
New Zealand went into recession at the start of last year but the first signs of a turnaround emerged in the June quarter this year when economic growth of less than 0.1 percent was posted.
Employment growth usually lags a turnaround and the 6.5 percent unemployment rate for September was up from 6.0 percent in the three months to June.
"New Zealand has come out of recession - just. But unemployment tends to lag behind an economy getting back on its feet," Employment Minister Paula Bennett said.
"Recent forecasts though have unemployment peaking closer to seven percent, instead of the eight percent forecast in the (May) budget."
The unemployment rate has risen from a low of 3.5 percent in the December 2007 quarter.
ASB Bank chief economist Nick Tuffley said he expected the unemployment rate to be slightly over seven percent by the end of 2010.
"Caution over hiring is likely to remain in the short term. Moreover, the average work week has declined since the recession started, so a number of employers have the ability to increase production without the need for hiring additional workers," Tuffley said.
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