The number of people officially out of work fell by 7000 in the final three months of last year.
Official unemployment was 150,000 at the end of 2011, the lowest number out of work in more than a year.
The jobless rate fell 0.2 percentage points in the December quarter, to 6.3%.
Statistics NZ says 3000 new jobs were created in the December quarter overall.
This came from the creation of 15,000 new part time jobs. Full time jobs fell by 13,000.
But 3000 people gave up looking for work in the quarter.
Economists say a fall in the headline unemployment rate is misleading, as the labour market remains weak.
Deutsche Bank chief economist Darren Gibbs says modest employment growth, a lower workforce participation rate and a sharp fall in hours worked, paints a subdued outlook.
He says the unemployment rate is expected to remain around 6% for the rest of this year and a sustained reduction in the rate is not expected until next year.
Official employment figures show declines in Canterbury's workforce are beginning to level out.
The workforce has fallen continuously since quakes first struck the region but showed some signs of stabilising at the end of 2011.