NEW ZEALAND: Early Signs Of Labour Market Stabilisation

January filled jobs rose 0.3% m/m but are still down 1.2% y/y, which was an improvement from December’s -1.5% y/y. 3-month momentum posted a small annualised rise, the first since April 2024, suggesting the labour market may be stabilising. The monthly rise was driven by the services sector. The RBNZ expects the unemployment rate to decline to 4.9% by year end after peaking at 5.2% in H1.

• Services filled jobs rose 0.5% m/m, while primary and goods-producing industries both fell 0.2% m/m.
• Over the last year, the construction and admin services sectors drove the weakness in employment with filled jobs down 6.6% y/y and 7% y/y respectively. Education, manufacturing and health care have all seen increases.
• The weakness in the jobs market has been broad based by region and age group. Young people have seen the sharpest decline in employment in the last year with 15-19 year olds -11% y/y. The 35-39 yrs group is the only one to record a rise up 2.6% y/y.
• Vacancy data is also consistent with a stabilisation in the labour market with January SEEK job ads up 4.1% m/m but still down 17.4% y/y improving from -21.9% y/y.

NZ employment situation