Householder pessimism about job security and the availability of work is likely to keep a lid on rising house prices and consumer spending, a bank economist says.
Westpac senior economist, Felix Delbruck, says people are less optimistic about their own job situation, and more pessimistic for the labour market as a whole.
Westpac McDermott Miller Employment Confidence Index fell for a third consecutive quarter to 98.9 in the three months to the end of March - the lowest reading since mid-2009. A result below 100 indicates there are more pessimists than optimists.
Mr Delbruck says consumer sentiment remains fragile, even though other recent surveys suggest the economy is picking up, particularly in the housing market.
Reserve Bank officials are likely to take some comfort from the limited signs of wage pressure, particularly in Canterbury, he says.