The latest Household Labour Force Survey has been released, and it shows seasonally-adjusted unemployment falling back to 3.6%. The decline was real - 7000 fewer people without work - rather than just the artefact of an expanding labour force, so its definitely good news. On the down side, the average hours worked per person rose, so it still seems that we are working harder, rather than smarter. But the longer the labour shortage keeps up (and its weird to think of "only" 3.6% unemployment and 79,000 unemployed as a "labour shortage"), then the more chance there is of out hidebound business community abandoning its "low wage, low skill" paradigm, and investing in productivity improvements.
This is indeed good news -for those of us that live in the real world and consider it great that more people can - hopefully - enjoy the dignity of work and becomer more prosperous and secure. Its also a good sign that the economy is stubbornly refusing to drop into the death spiral that tax cut now brigade keep predicting. Unfortunately however I forsee a cassandra howl from the gleeming towers, where banking analysts will bemoan the inflationary impact, the implications for interest rates, wage pressure affecting dividends, how the economy is falling behind in productivity and all the spending will push up the balance of payments deficit and the and the fact their own shadow gave them all such a fright that the sharemarket fell 3 points this morning before recovering with the growing cover this afternoon.
ReplyDeleteAnd anyway, what we really need is a tax cut. Tax cuts now. Oh and for Helen to pay it back. And a tax cut. And to make sure Maori lose their special privileges, which they wont need after a tax cut. And did I mention a tax cut? We really need a tax cut...............
It is weird to think of it as a shortage, but you have to bear in mind that out of 100 people you could probably find 1 or 2 who are "in transit" from having had enough or being fired. And of course in particular niches there are great shortages.
ReplyDeletestephen is right - 0% unemployment would imply a dangerously "unpicky" workforce. If you spend 2% of your life looking for that perfect job and 98% doing it that is a perfectly fine ratio. that is what the UB is all about insuring is feasible so you dont have to jsut take the first mcdonalds job you are offered no matter what your training.
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