WELLINGTON, Aug 6 (Reuters) — New Zealand’s unemployment rate rose to 5.2% in the second quarter, up from 5.1% in the previous quarter, while employment slipped 0.1%, according to official figures released on Wednesday.
A Reuters poll of economists had predicted a 5.3% jobless rate and a 0.1% fall in employment. The Reserve Bank of New Zealand (RBNZ) had anticipated a 5.2% unemployment rate.
Labour force participation stood at 70.5% in Q2, slightly below the expected 70.7%.
“Labour market conditions have shifted significantly over recent years. Since June 2022, the unemployment rate has climbed by 1.9 percentage points,” said Jason Attewell, labour market spokesperson at Statistics New Zealand. “Over the same period, the underutilisation rate has increased by 3.5 percentage points.”
Wage growth accelerated in the quarter, with the private sector labour cost index, excluding overtime, rising 0.6% from the previous quarter — matching forecasts — after a 0.4% gain in Q1. On an annual basis, seasonally adjusted private sector wages rose 2.2%.
Persistent labour market softness is expected to strengthen the case for the RBNZ to cut its cash rate by 25 basis points at its August meeting. The central bank has lowered the cash rate by 225 basis points since August 2024 but paused in July to assess the effects of trade tensions and a modest uptick in inflation.
