Unemployment - Digging beneath the headline rate

The unemployment rate rose in the June quarter to 5.2 percent. For those who are interested, here's some finer detail behind the headline statistic.

While the media has latched on to the idea that the elderly are discriminated against in the workforce the stats don't support it. The highest unemployment rates are amongst the young: 15-19 year-olds at 23% and 20-24 year-olds at 9.8% . Thereafter, as the age-bands increase, the unemployment rates fall significantly with most numbers starting with a 3 and the lowest - 2.9% - belonging to the 55-59 year-olds. It'd be fair to state that the older you are, the less likely you are to be unemployed. It is only after age 60 that an increase in those 'not in the labour force' is marked, indicating around 30,000 individuals choosing early retirement. Whether that is voluntary or involuntary is unknown. But the unemployment rate for 60-64 year-olds is just 3.2%. Past the age of sixty five, 217,500 individuals continued to work, an increase on June 2024 of 7,800. Because most people leave the labour force after 65, that age group's unemployment rate is the lowest at just 1.6 percent.

So it is the very young who are bearing the brunt of unemployment.

In terms of ethnicity, Pacific people have the highest unemployment rate at 12.1 percent followed by Maori (10%); Middle Eastern and Latin American and African (6.5%); Asian (5.2%) and European (3.8%). This pattern has held over decades. The lower skilled and educated feature more heavily among the unemployed.

The fact that Auckland's unemployment rate was high at last got some attention. I have written previously about Wellington doing a lot of whinging when their numbers aren't the worst. Auckland's unemployment rate is 6.1% - up from 4.6% a year ago. Wellington's rate is 4.1% - down from 4.3% a year ago. As usual, the further south the region is, the lower the unemployment rate. Otago has the lowest rate at 3%.

Which sectors are faring the best? With respect to numbers of people employed, the following sectors gained over the year: electricity,  gas, water and waste; wholesale trade; financial and insurance services; rental, hiring and real estate services; and education and training. Many of us won't be surprised to see electricity, gas, and insurance featuring among the 'healthier' sectors.

There's been a bit of media-murmuring over the NEET rate (Not in Employment, Education or Training) but it's actually fairly steady for 15–24-year-olds moving from 12 to 12.2% June on June. There was a very big jump in 15-19 year-olds in education between March and June this year rising by 23,400 (which helps explain why the education and training sector is adding jobs.) Hopefully this will play out as a good news story in time.

Internationally New Zealand now sits 18th out of 38 OECD countries - just above the average unemployment rate of 4.9%. The English-speaking countries we often compare ourselves to have the following rates: Australia and the United States (4.2%); the United Kingdom (4.5%) and Canada (6.9%).

Finally, females are slightly more likely to be unemployed with a rate of 5.5% versus males at 5%.

All in all, the usual patterns are evident with respect to age, ethnicity and gender. The numbers don't necessarily support the narratives pushed by the likes of RNZ and Stuff who appear intent on winding up anger against the current government.

All of the above data comes from the HLFS (Household Labour Force Survey) for June 2025.

In a diversion I will make a final comment about how closely related those numbers are to benefit stats. Not very.

The HLFS has 158,000 people unemployed whereas 216,000 are on the Jobseeker benefit. Some of the difference occurs because some on Jobseeker are partially employed. Some of the difference occurs because not all Jobseeker beneficiaries are necessarily in the labour force (available for work). They might be temporarily too ill to work.

The total number of working age people on benefits though is 406,128 or 12.5 percent of the 18-64 year-old population.  The balance is mainly on  Sole Parent Support, or on what's now called a Supported Living Payment due to permanent incapacitation.

If the usual trends occur, in time the unemployment rate will abate and those who have been on welfare short-term will return to the workforce. But the ongoing underlying dependency will persist as the headline numbers drop and politicians think the job is done.