5 May 2011

Fall in unemployment tipped

8:29 am on 5 May 2011

ASB economist Jane Turner expects unemployment to have fallen in the last few months.

The quarterly Statistics New Zealand Household Labour Force Survey is due to be issued on Thursday, with the official employment and unemployment figures.

Ms Turner anticipates a growth in employment, that should help the unemployment rate ease from 6.8%, to 6.7%.

She says that change is driven by a pick-up in the underlying economy in the first part of the year.

Ms Turner says businesses are feeling more confident and have signaled they are be employing more people.

She says unemployment has been a key area holding back consumer confidence.

But she expects more sustained recovery in employment levels by the end of the year.

She says the impact of the Christchurch earthquake is not captured in the survey.

ANZ view

ANZ Bank chief economist Cameron Bagrie also expects the unemployment rate to drop slightly.

He told Morning Report that the rate may drop to about 6.5%.

But, he said, volatility in thr figures make it difficult to interpret them.