'The data suggests that New Zealand is very much in the thick of economic downturn'
Online job postings in New Zealand reported a "massive" 10.8% decline in the June quarter, with advertisements for flexible work hit hard, according to a new report.
The Jobs Report released by the Recruitment, Consulting & Staffing Association (RCSA) revealed that this quarter's online job postings are 23.7% lower than a year ago.
"The data suggests that New Zealand is very much in the thick of economic downturn, with the country officially in recession and job ads declining steeply in recent months," said RCSA CEO Charles Cameron in a statement.
Sectors with biggest job declines
Job postings for Accommodation and Food Services sector saw the biggest decline with 36.6%, according to the report.
"It would appear that tougher economic conditions have decreased expenditure on entertainment and dining out. Tourism is still in recovery but less buoyant in winter months," the report said.
Other key dips were also recorded for the following job postings:
- Technology Professionals (-28.7%)
- Service and Community Workers (-26.7%)
- Labourers, Drivers, and Operators (-24.4%)
- Education and Training (-21.8%)
- Mining, Construction and Utilities (-16.8%)
- Manufacturing and Distribution down (-16.6%)
- Financial and Insurance Services (-15.5%)
- Professional, Scientific, and Technical (-12.3%)
The only sector to record growth was Public Administration, which registered a 1.6% increase in the June quarter.
"Work in the Public Sector is traditionally considered a 'safe haven' in tough economic times. With the General Election set for October job posting are likely to retreat in the immediate future," the report said.
Have employers given up on job boards?
Cameron attributed the plunging job ads to the lack of talent in New Zealand.
"There is definitely concern about what the market is doing and where it is heading but the lack of job postings could also be because employers have given up on using job boards," he said.
"The country's skills shortage is so dire, it's highly likely that businesses have halted recruitment efforts because of the severe lack of talent. Add in recent natural disasters, economic challenges, and a looming election, it is little wonder the job market has been impacted."
The findings come as New Zealand slipped into a recession after the first quarter's gross domestic product fell by 0.1%, according to Stats NZ.
Unemployment rate also stayed at 3.4% in the March quarter, according to official data, but it predicted to rise in the coming quarter.
"Job postings are a lead indicator of employment. It is likely that unemployment will rise in the next quarter," the RCSA report said.
Flexible work opportunities dip
Meanwhile, the report found that job ads for flexible work roles also plummeted hard in New Zealand, declining by 25%.
The RCSA tagged it as an "interesting development" as flexible work opportunities are expected to go up amid economic instability.
Cameron attributed the current situation on the lack of talent.
"This could once again be a side effect of the skill shortages. It is very possible that employers are trying to fill permanent positions to lock down staff in a talent poor environment," he said.
‘More balanced job market’
Cameron forecasted "tough times ahead" for organisations across New Zealand.
"The next quarter is crucial and will give us a better indication how long we will be riding this 'downturn' wave," he said.
Despite this uncertainty, however, recruiters surveyed are saying the market remains strong even if there was a decrease in activity. According to them, there is a "more balanced jobs market" compared to the severe skills shortage the previous year.
"The fact our members remain relatively optimistic is a good sign. They are a valuable barometer when it comes to interpreting what is actually going on, on the ground. That they aren't too concerned should provide some comfort," Cameron said.