Overview
- The Q2 labour force release on Tuesday showed the unemployment rate climbed to 5.6% while the participation rate rose to 70.7% and employment grew by about 5,000 people.
- Measures of spare capacity worsened as underutilisation hit 13.8% and roughly 8,000 more people were long‑term unemployed than a year earlier.
- Wage readings were mixed with the Labour Costs Index up 2.1% year on year while a broader wage series remained near a five‑year low of about 2%, well below recent consumer inflation.
- Labour outcomes varied across the country with Northland and Auckland reporting rates above 6% and all South Island regions below 5%, and youth unemployment rising for 15–24 year olds.
- The print came in above most forecasts, including the Reserve Bank's estimates, and market and economist reaction has pushed up odds of a rate increase before the RBNZ meeting on September 2.