The seasonally adjusted unemployment rate was 3.6 per cent in the June 2023 quarter, compared with 3.4 per cent last quarter, according to figures released by Stats NZ.

That was slightly higher than the consensus of economic forecasts at 3.5 per cent.

Unemployment, along with underemployment and the potential labour force, is one of the components that comprise underutilisation – a broader measure of spare labour market capacity than unemployment alone.

The underutilisation rate increased from 9.1 per cent (revised) to 9.8 per cent this quarter. The largest increase came from growth in underemployed part-timers, who wanted and were available to work more hours.

Wage cost inflation, as measured by the Labour Cost Index (LCI), remained at 4.3 per cent in the year to the June 2023 quarter.

“Annual wage costs continued to increase at historically high rates this quarter, equal to the 4.3 per cent annual increase last quarter,” business prices delivery manager Bryan Downes said.

Employment still strong

In the year to the June 2023 quarter, the number of people employed increased 113,000 (4.0 per cent) to 2,927,000. The employment rate reached 69.8 per cent, the highest rate recorded by the HLFS since the series began in 1986.

The employment rate for women increased to 65.4 per cent, the highest rate since the series began. The employment rate for men increased to 74.4 per cent, the highest rate since 1987.