Sharp unemployment rise in Bay of Plenty

Unemployment in the Western Bay of Plenty increased in the last three months of 2012, new figures reveal.

Statistics NZ figures showed the unemployment rate in Western Bay climbed to 8.3 per cent in the December quarter, 2.6 per cent higher than the September rate.

Meanwhile, the employment rate - the percentage of people employed in the working-age population - dropped 4.7 per cent to 53.8 per cent.

Statistics NZ said the Western Bay figures were estimates and should be treated as "indicative" due to the small sample size.

A local union rep said casualisation of the work force and short-term contracts were causing havoc for many Western Bay workers.

"There's hardly any permanent positions offered - it's all casual and seasonal," EPMU Tauranga organiser Raymond Wheeler said.

Many people were fed up, he said. "The comments I get a lot are 'why bother - I'll only be here a couple of months, if that'.

Nationally, the unemployment rate dropped to 6.9 per cent in the three months to December.

That was down from a 13-year high of 7.3 per cent in the September quarter, according to the household labour force survey.

However, the number of working age people in employment has also fallen with 23,000 fewer Kiwis in jobs.

"We're seeing fewer people working and looking for work, and more people outside the labour force," Diane Ramsay of Statistics NZ said.

"More younger people are solely in study and more older people are entering retirement."

The employment rate fell 0.8 per cent for the December quarter, to 62.6 per cent. A breakdown showed the fall was due to a 6 per cent decline in part time employment. Full time employment rose slightly (0.4 per cent).

Westpac economists called the survey an "oddball assessment" of the labour market. "Our assessment of the labour market has not really changed - it is still weak, but we do not believe that it has suddenly got sharply better or worse."

Year-on-year figures showed the total number of Kiwi jobs fell 1.4 per cent in the 12 months to December. This was led by a 19 per cent plunge in self-employment, which has been falling from a peak in December 2011.

Otago had the lowest unemployment rate across the regions at 4.3 per cent, with Southland at 4.6 per cent and Canterbury at 4.9 per cent. Auckland's unemployment rate improved to 7.2 per cent, while Wellington's rose to 7.9 per cent.

Northland had the highest unemployment rate at 9.5 per cent.

Labour's finance spokesman David Parker said workers in the manufacturing sector had struggled in the past year.

"[It] was a bad year for workers in the manufacturing sector. There were 17,200 fewer people in jobs at the end of it with the number falling every quarter."

Tertiary Education, Skills and Employment Minister Steven Joyce said the survey reflected the "on-going impact of tough economic times globally".

New Zealand's unemployment rate is now the 14th lowest among developed nations. additional reporting Jamie Gray, Business Desk