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Working people need to benefit from growth in economy

Strong growth in the economy in the three months to September was not matched by growth in employment, with more people not in work.

“While stronger growth is welcome, it needs to be shared with the people who need it most,” says CTU economist Bill Rosenberg.

“Treasury and Reserve Bank forecasts are for an increasing number of Kiwis to be out of work.  What is the Government doing? It has a responsibility to ensure that unemployment does not reach the level of 164,000 people forecast by Treasury in three months time, March 2016,” Rosenberg says.

“The Government should address the evident needs in health, housing and addressing child poverty. That would also help to get more kiwis into jobs.”

Rosenberg also pointed out that the growth in the economy is still relatively weak per person in New Zealand because of the relatively rapid growth of the population due to higher net immigration. While the economy was estimated to have grown 0.9 percent over the three months to September, it grew only 0.4 percent per person and actually shrank by 0.2 percent when looking only at the production that New Zealand residents benefit from. “This is still well down on the per capita growth levels in the mid-2000s,” Rosenberg says.

“Productivity growth is also weak according to Treasury, and this does not bode well for future increases in wages,” Rosenberg said.