Employment

Relevance

The employment rate is the best available indicator of the prevalence of paid employment. It is affected by trends in both unemployment and labour force participation (the proportion of the working-age population either employed or unemployed).

Current level and trends

In the year ended March 2009, 74.6 per cent of 15–64 year olds (2.112 million people) were employed. This was a decrease from 74.9 per cent in the years ended March 2007 and March 2008, the highest rates recorded, and reflects the economic recession over the year to March 2009. Between 1987 and 1992, the employment rate fell from 72.2 per cent to 65.0 per cent but has generally risen since, except during the economic downturn of 1998 and 1999.

The full-time employment rate for 15–64 year olds declined sharply between the years ended March 1987 (60.1 per cent) and March 1992 (51.4 per cent), and had almost recovered to the mid-1980s level by 2009 (58.4 per cent). The part-time employment rate increased over the period, from 12.1 per cent in the year to March 1987 to 16.2 per cent in 2009. Although the part-time rate has almost doubled for men since 1986, women continue to have a higher part-time employment rate than men (23.5 per cent compared with 8.5 per cent in the year ended March 2009).

Figure PW2.1 Employment rate, 1987–2009

Source: Statistics New Zealand, Household Labour Force Survey
Note: Based on population aged 15–64 years

Age and sex differences

The fall in the employment rate between 1987 and 1992 affected all age groups but was most pronounced for young people aged 15–24 years. Youth employment rates have remained relatively low during the period of employment growth since 1992, possibly because more young people are participating in tertiary education and training. Conversely, employment rates for people aged 45–64 years have grown strongly since 1992, driven mainly by the phasing in of the higher age of eligibility for New Zealand Superannuation, rising employment among women, and an increase in the demand for labour.

The employment rate for women is significantly lower than that for men. This is mainly because women spend more time on childcare and other unpaid household work, and are more likely than men to undertake some form of study or training. However, growth in the employment rate between the years ended March 1992 and March 2009 was stronger for women than for men and the sex difference in the employment rate has narrowed from 16 to 12 percentage points over that time.

Table PW2.1 Employment rates (%), by age and sex, selected years, 1987–2009

Source: Statistics New Zealand, Household Labour Force Survey
Note: Average for March years

Ethnic differences

The employment rates for Māori and Pacific peoples showed the steepest fall between 1987 and 1992, but also the strongest recovery as economic conditions improved. In the year to March 2009, the Māori employment rate, at 65.6 per cent, was slightly higher than the rate for the previous year (65.1 per cent) and had surpassed the 1987 level (61.0 per cent). In contrast, the Pacific peoples’ employment rate declined slightly between the 2008 and 2009 March years (from 62.8 per cent to 62.4 per cent) and they were still less likely to be employed than in 1987 (69.0 per cent). Pacific peoples have had the lowest employment rate since 2007.

After declining slightly between 1987 and 1992, the European employment rate reached a record high of 79.9 per cent in the year to March 2007, then fell slightly to 79.6 per cent in 2008 and to 79.1 per cent in 2009. The European employment rate had surpassed the level of the mid-1980s (73.8 per cent in 1987) by the mid-1990s. The employment rate for the Other (including Asian) ethnic group, which includes many new migrants, has shown the most change over the period, falling from the second highest in the late-1980s to the lowest over the decade to 2006. Faster growth in employment from 2003 to 2007 saw this group exceed the employment rate of Pacific peoples. The Other employment rate, like that of Māori, has continued to increase, from 64.4 per cent in the year to March 2008 to 65.0 per cent in the year ended March 2009.

Figure PW2.2 Employment rate, by ethnic group, 1987–2009

Source: Statistics New Zealand, Household Labour Force Survey
Notes: Based on population aged 15–64 years

International comparison

In the year to December 2008, New Zealand was ranked seventh highest of 30 OECD countries with an employment rate of 74.7 per cent for people aged 15–64 years. This was well above the OECD average of 66.6 per cent. Iceland had the highest employment rate in 2008 (84.2 per cent). The New Zealand rate in 2008 was higher than those of Canada (73.7 per cent), Australia (73.2 per cent), the United Kingdom (72.7 per cent) and the United States (70.9 per cent). New Zealand had a higher male and female employment rate than the United Kingdom, the United States and Australia in 2008 but had a lower female employment rate than Canada.⁵⁹

» View technical details about the employment indicator