Wednesday's June quarter unemployment figures were disastrous for National — but not all that good for New Zealand either.
National's assumption was that the election campaign would be conducted amid labour market chaos.
Back in May, the Reserve Bank's worst-case scenario had unemployment reaching 18 per cent, with a less-severe scenario in the range of "just" 9 to 13 per cent, above the September 1991 record.
Jobs plunged by 37,500 in April and economists talked of an even-worse second wave of job losses before the election.
Private-sector economists thought June quarter unemployment would be in the 5 to 6.4 per cent range, a big jump from 4.2 per cent in March, while the Reserve Bank picked 7 per cent.
On Wednesday, when it announced unemployment had in fact fallen to 4 per cent, even Stats NZ urged caution in interpreting the numbers.
It pointed out that hours worked had fallen by a record 10.3 per cent and underutilisation had leapt to an unprecedented 12 per cent.
It explained that, to be unemployed, a person had to be actively seeking work in the previous four weeks, which people simply couldn't do during lockdown. Consequently, the number of people in the labour force fell by 17,000, the biggest drop since the global financial crisis.
Stats NZ even went so far as to reveal unemployment had risen to 6.2 per cent during the final week of June, albeit based on a small sample of 500 people.
Most importantly, it reminded us that the $13 billion wage subsidy scheme had been in place throughout the quarter.
National's Paul Goldsmith highlighted that over 450,000 people remain on the scheme, which means their jobs are at serious risk when it ends on September 1, unless their employers are claiming the subsidy when they don't need it.
But none of this matters. Stats NZ is the referee and its headline numbers are the ones that go on the scoreboard.
It may have channelled the NRL Bunker by going out of its way to explain why the try was awarded, and commentators will argue for decades whether there was a forward pass, but Jacinda Ardern is perfectly entitled to claim her 4 points.
It will do Judith Collins no good to say, "ah, but people have only kept their jobs because Labour extended the wage subsidy scheme", since Ardern will simply agree, saying "yes, that's why I extended it".
Labour's pitch to voters is now "not only did Ardern save your life, she saved your job too".
National now relies on less authoritative sources to back up its jobs-crisis narrative. These include economic forecasts, but voters have learned not to bank on those, one way or the other. More useful will be daily news reports of job losses and the Ministry of Social Development's highly volatile Income Support and Wage Subsidy Weekly Update, which might bounce National's way over the next crucial weeks.
But, whatever happens with the data, National's campaign slogan of "Strong Team, More Jobs, Better Economy" has taken another hit. It is only the third bit, "better economy", that remains credible.
Collins has less than a month before early voting starts to give meaning to that slogan.
So far, "better economy" has been expressed mainly through ambitious multi-decade transport projects, including expressways linking Whangārei, Marsden Point, Auckland, Hamilton and Tauranga, and completing Auckland's rapid transit network, first mooted by Sir Dove-Myer Robinson in the 1970s.
There have also been policies to create jobs and promote small businesses, including by giving unemployed people access to their KiwiSaver money.
On tax, Collins has ruled out both tax rises and tax cuts, commitments Ardern is likely to match. Both main parties are promising to increase funding to schools and hospitals, and not to cut benefits. Maintaining the Zero Carbon Act and scrapping the Resource Management Act is also settled policy between the parties. Opening the border to save the tourism and international education sectors is out of the question politically, as yesterday's Herald-Kantar poll confirms.
This doesn't leave Collins with much space to demonstrate how National is offering a better economy than Labour.
The key point of difference, so far, is Paul Goldsmith's commitment to get net core government debt back below 30 per cent of GDP "in a decade or so".
It is currently forecast to peak at 53.6 per cent of GDP in 2023/24 under Ardern, who is comfortable with it still being as high as 47.5 per cent of GDP in 2030/31, and as much as 42 per cent as late as 2034/35.
National argues that getting debt back down more quickly is necessary in case there is another economic shock in the next couple of decades. Labour argues that would require government spending to be $80b lower than it plans over the next decade. National says it can bridge the gap mainly by delivering higher economic growth and by stopping contributions to the Super Fund, which are in effect expensed by the Treasury rather than recorded as an asset in the government balance sheet.
The problem for National is that, even if it is right on all these points, debates over debt levels 10 years hence are unlikely to excite too many voters.
"Better economy" will need to mean something much more proximate and exciting than which party would have more room to borrow again should a new crisis hit in 2030.
Alternatively, Collins will need to hope for some type of miracle — say, a minister or two being arrested for fraud or something.
- Matthew Hooton is an Auckland-based public relations consultant. He was speechwriter for former National Leader Todd Muller and assisted in the transition to new Leader Judith Collins.