Drop in jobless stats a mystery

Last updated 12:00 06/02/2014

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The unemployment rate is plummeting faster in Manawatu-Whanganui than anywhere else in the country - and the region's leaders are overjoyed but perplexed about how it has happened.

There was little consensus or explanation yesterday for exactly how 2400 people in the region disappeared off Statistics New Zealand's estimated number of unemployed within three months.

In its Household Labour Force Survey for the December 2013 quarter released yesterday, the unemployment rate for the Manawatu-Whanganui region was 5.7 per cent, lower than the new national unemployment rate of 6 per cent.

It was 24 per cent down on what it was three months ago and 32 per cent down on the same quarter in 2012.

Palmerston North Mayor Jono Naylor said the improvement was fantastic news for the region as a whole, but he was at a loss as to how to explain it.

"Sometimes you can attribute a big change like this to a specific event or events that have happened during that time but I'm encouraged because I honestly can't think of a specific event that would have achieved this.

"I would see it as a general positive sign of where we are heading economically as a region."

The fact that the data included Palmerston North City with Horowhenua, Tararua, Manawatu, Rangitikei, Wanganui and Ruapehu Districts meant there was a need to be both cautious and celebratory with the figures, Mr Naylor said.

"The grouping of us with Whanganui has not necessarily served us well in the past - it's meant that we often haven't performed as a region to national standards in things like unemployment.

"We want to be heading as a council to somewhere closer to zero, but to drop below the national average is definitely good news."

Palmerston North MP Iain Lees-Galloway said the drop was surprising and not something he was hearing anecdotally.

"One theory might be that a number of people have picked up a little bit of work, an hour here or an hour there, but they're still significantly underemployed."

Mr Lees-Galloway said that would explain why there was a rising number of people claiming the job seekers benefit in the region, but a lower number of people being classed as unemployed.

"It's a good sign that there's less people unemployed and I'm sure the numbers are accurate but I would like to see a little bit more behind them."

Rangitikei MP Ian McKelvie said he never ceased to be amazed by employment figures but said he was surprised at the scale of the improvement for his region.

"If I could blame it on two things, so to speak, I would say it's the increase in spending from farmers that is helping our service sectors and also the boom in summer tourism that we're starting to see in Rangitikei and Ruapehu."

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Vision Manawatu regional business manager Mark Hargreaves said a good season for farming had translated into a good season for construction, and retail sales had been extremely strong at the end of the year.

Last month the Palmerston North City Council's economic policy adviser Peter Crawford predicted a drop in unemployment for the region, but told the Manawatu Standard it was unlikely to be significant because migration to the city had been so strong in recent months.


Whanganui unemployment rate

- December 2012: 8.5 per cent

- March 2013: 7.7 per cent

- June 2013: 8.9 per cent

- September 2013: 7.5 per cent

- December 2013: 5.7 per cent

Number of people unemployed in Manawatu-Whanganui

- December 2012: 10,100

- March 2013: 9200

- June 2013: 10,800

- September 2013: 9100

- December 2013: 6700

- Manawatu Standard

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