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New Zealand Employment Confidence Remains Weak: Westpac

Employment confidence across New Zealand remained generally weak in in the December quarter, except for Canterbury where households are fairly confident about employment prospects, the latest survey by Westpac and McDermott Miller showed Monday.

The Westpac McDermott Miller employment confidence index stayed little changed at 99.1 in the three months ended December from 98.9 recorded in the September quarter, suggesting that overall sentiment remains pessimistic. An index reading above 100 indicates that optimists outnumber pessimists, while one below shows that pessimists dominate.

Contributing to the weakness of the overall sentiment, the indicator of households' assessment of their own job security retreated sharply, after bouncing back in the September quarter. The corresponding index dropped to 110.3 from 111.9.

Westpac said it was a surprise that employment confidence didn't fall further, given the grim jobs-related data that have come out in the last few months. New Zealand's unemployment rate shot up to 7.3 percent in November, which was the highest figure in more than a decade.

Despite the pessimism regarding job security, consumer confidence, however, increased notably during the quarter, helped mainly by low interest rates, rising house prices in Auckland, and low prices.

The survey showed that employees' earnings, meanwhile, increased during the December quarter, suggesting that wage inflation continued to truck along close to 2 percent.

by RTT Staff Writer

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