NZ unemployment surges to 10-year high

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WELLINGTON, New Zealand -New Zealand's unemployment rate surged to 7.3 percent in the last three months of 2009 — its highest level in 10 years — up from 6.5 percent in the previous three months, official data showed Thursday.

The unemployment rate is now 3.5 percentage points higher than at the start of 2008, when the economy slipped into a recession that lasted five straight quarters.

The number of jobless people climbed 18,000 during the quarter that ended Dec. 31 to 168,000, according to labor force figures released by government data agency Statistics New Zealand.

This was caused mainly by a rise in the number of young people entering the labor force and unable to find work, it said.

The unemployment rate for those aged 15 to 24 rose 6.4 percentage points during the quarter to 18.4 percent.

New Zealand's economy grew by just 0.2 percent in the three months, with economists warning that the recovery would be slow.

But the sharp rise in jobless numbers surprised markets.

The nation's central bank had forecast a 6.6 percent unemployment rate for the three months.

Employment Minister Paula Bennett said the higher number simply meant there are "more people joining the work force, which is outstripping job growth."

"Employment almost always lags behind economic growth, (so) we're not out of the woods yet," Bennett said.

2010-02-03 20:31:40