The Household Labour Force Survey, which is the official measurement of unemployment in New Zealand, reveals that the unemployment rate is 7.3% of the work force (or approximately 299,000 people). Yet, the numbers of people on the unemployment benefit are around the 50,000 mark according to the Ministry of Social Development.
The Household Labour Force Survey has been used as the official measurement of unemployment since 1991 and it has traditionally shown the unemployment rate as being lower than the numbers of people on the unemployment benefit because the definition of unemployment used by the Household Labour Force Survey doesn't include people who are doing paid employment for more than an hour a week. On the other hand, the Household Labour Force Survey does includes people who are unemployed but would not qualify for the unemployment benefit because their partner is working full time (i.e. 30 hours a week or more as defined by the Department of Work and Income) or earning too much.
When the Household Labour Force Survey was showing rates that were about the same or lower than the numbers of people on the unemployment benefit the government of the day was quite happy to throw those figures around but when the numbers of people who are unemployed as defined by the Household Labour Force Survey started to rise rapidly the present National-led government began to question the reliability of the Household Labour Force Survey figures, especially as the Prime Minister John Key claimed that the government has other figures which prove the unemployment figures are not as high.
The government cannot pick and choose the unemployment rates that only paint a rosier picture and ignore the official unemployment rate because the figures paint an embarassing picture of how the New Zealand economy is actually performing and the dismal failure of the government to come up with any programmes or policies to address the unemployment rate, other than to promise that the rebuilding of Christchurch will create thousands of jobs. But the government is right on one point: the gap between the numbers on the Unemployment Benefit and the numbers of unemployed people as defined by the Household Labour Force Survey does raise a valid question about the way in which unemployment is calculated.
How can we end up with a difference of nearly 249,000 people between the Household Labour Force Survey and the Unemployment Benefit? It's pretty tough as to how to address the unemployment question if the two main figures used to determine the numbers of unemployed people are showing such a huge difference. It also raises the methodology being used to calculate the unemployment rate, particularly by the Ministry of Social Development, particularly as that organisation does not include seasonal workers and people on what Work and Income calls the Unemployment Benefit (Training) Benefit. The former because most seasonal workers are put on the Emergency Benefit rather than the unemployment benefit to create the impression the numbers of the unemployed is lower than it really is.
Even if we take the lowest unemployment figures an unemployment rate of 50,000 people is still 50,000 people too many but the simple fact of the matter is the unemployment question needs to be addressed through the creation of sustainable jobs. That is, jobs that actually pay liveable wages, provide reasonable working conditions and last longer than three, six or twelve months. They also need be more than jobs centred on building houses in Auckland, rebuilding Christchurch or caregiving jobs on the Kapiti Coast. That's not to say these aren't important but most of the unemployed are not skilled in such jobs. A substantial number of the unemployed include people laid off in manufacturing (due to competition from countries like China), hospitality (especially with the downturn in tourism numbers), retail (due mostly to on-line shopping making it cheaper to buy from overseas than here), farming (falling demand for dairy products, meat and wool) and the public service (due to an ideological obsession with reducing bureaucracy).
Unlike many countries New Zealand has managed to retain a relatively low employment rate of 7.3% because New Zealand is exporting much of its unemployment to Australia but with the Australian economy now experiencing job losses in the mining sector and its own unemployment rate increasing (albeit at a slower rate) the question of how long the Australians will continue to accept large numbers of New Zealanders migrating across the Tasman remains to be seen. However, if unemployment in the United States continues to hover around the 9% mark and the rates of unemployment in many countries in the Eurozone hover around the 25% mark in, particularly Greece, Italy and Spain or the unemployment rates get worse, as is widely predicted, unemployment is going to get a lot worse, regardless of the unemployment statistics that are used.
Playing around with the statistics or only using statistics that suit the government of the day is not a solution to unemployment. Nor are the austrity measures being introduced around the world in the capitalist countries. Indeed, as the simplistic mantra there is no alternative to austerity continues to be advocated in Europe, New Zealand and the United States, the growing realisation is dawning upon much of the world is that capitalism has failed miserably for most people, especially for the workers, the unemployed and even the bourgeoisie.
Internationally, as unemployment continues to soar and living standards and working conditions in the work place continue to plummet, workers don't want to hear statistics being thrown around Parliaments by politicians. They want solutions that will end their unemployment, improve their standard of living and make their work places much safer. That is why there is such a growth of renewed interest in the ideas of Karl Marx and the need to create a socialist society here in New Zealand and internationally where the scurge of unemployment can be got rid of once and for all.