"Bleeding" Canterbury contractors are not surprised the region now has 21,500 unemployed, a sharp rise from three months ago.
The Household Labour Force Survey, released yesterday, shows Canterbury's unemployment rate has climbed to 6.5 per cent at the end of June from 5.5 per cent in March when 18,800 were unemployed.
As well, almost 18,000 jobs have gone in the year to June, many of them jobs held by women.
Cantrades, the newly formed mouthpiece for Canterbury tradesmen, said the drop in jobs was because of uncertainty and a lack of work that was choking the rebuild.
Cantrades chairman Lester Bryant said people with damaged homes were waiting desperately for repairs while contractors were underemployed and laying off staff.
One firm he knew had been encouraged by its project manager (PMO) to gear up for a large amount of work. The owner pumped $700,000 into it, taking on staff and buying new equipment, only for the work never to eventuate. The firm had shed staff and was on the verge of going under, he said.
Many contracting firms he dealt with were laying off staff due to a lack of work.
"PMOs are not putting the work out in a consistent fashion. I'm not surprised that there's a reduction in skilled labour employment."
UBS New Zealand senior economist Robin Clements said instead of a small improvement in jobs driven by a growing Canterbury rebuild, the figures show the opposite.
"It's difficult to understand why you would get a sharp decline [of jobs] in Canterbury, you would think employment was building up."
Fletcher EQR, the repair project manager for the Earthquake Commission, was regularly calling for more workers and the Stronger Christchurch Infrastructure Rebuild Team announced it was hunting for 1000 more staff by the year's end. The jobs figures are gathered by a survey which made the regional figures volatile.
However, if the numbers were correct, firms might be running out of business interruption insurance and failing, causing job losses. Another reason could be firms with surplus staff finally having to let them go because the rebuild was not underway, Clements said.
Paul O'Donnell, managing director of 0800 WePaint, said the work coming out of the Fletcher hubs had slowed to a trickle.
He had put off 10 staff and several groups of subcontractors because of the slowdown.
"‘People are bleeding right now because there's not enough work," O'Donnell said.
Council of Trade Unions earthquake recovery spokesman Marty Braithwaite said: "I think what it actually shows is that the recovery hasn't kicked in."
The survey data shows women in Canterbury bearing the brunt of job losses because many were in retail, hospitality, health and social care and primary teaching where women dominate and those jobs were hard hit by the earthquakes.
The statistics show the Canterbury working population has shrunk 26,000 in the year to June, but BNZ chief economist Tony Alexander said he would not conclude that 26,000 had "shot through" because the regional data was notoriously volatile.
A surge in jobs was expected once the rebuild got underway but forecasting when that would happen had been difficult, he said.
Work and Income labour market manager Jo Aldridge was "mystified" at the increase in unemployment.
The number of people on the unemployment benefit was falling, she said, and Winz was working with 21 "industry partners" to understand what skills their jobs required.
- © Fairfax NZ News
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