Prime Minister John Key remains confident the employment market will improve, even though new figures show more people out of work.
The Household Labour Force Survey released on Thursday said 160,000 people were officially unemployed at the end of March, up 9000 from the start of the year.
While 9000 new jobs were created during the three months, the increase was not enough to keep up with the 18,000 extra people looking for work.
Mr Key says the economy is creating employment and attracting more people to look for jobs, which is pushing up the unemployment rate but also shows more people feel confident enough in the job market to look for work.
He says employers are telling him they are ready to hire more and a big increase in part-time jobs is likely to be followed by a turnaround in full-time jobs.
The Council of Trade Unions says the latest figures show the job market is on its knees. It says the Government should be doing more to stimulate employment rather than cutting spending to balance its books which is detrimental to the economy and jobs.