Recession hits job market as thousands join unemployment queue

Competition for work is heating up, with job applicants on a major website jumping 114 per cent in a year. Economists expect the labour market to deteriorate into 2025 as wage growth slows
and fewer businesses hire staff. Thousands more have joined the unemployment queue but some employers are still struggling to get staff as people chase more money in Australia. Carmen Hall reports.

Job listings on one major website have plummeted 27 per cent year-on-year and thousands more people are signing up for unemployment benefits as companies close their doors.

An economist also says it is easier to get skilled and unskilled labour “than it was during the Global Financial Crisis, where the economy experienced widespread job losses”.

1st Call Recruitment managing director Phil van Syp said the state of the job market was the opposite of 12 months ago, when the agency struggled to find candidates.

“Now people are wanting anything they can get their hands on with regard to work. We’ve got so many people coming in the door.”

This included builders, bricklayers and landscapers who the company had never had on their books before.

“We have never, ever been able to get hold of builders like we have now.”

If people were unreliable or didn’t want a job, the agency had “10 people ready to go”.

Personnel Resources Rotorua consultant Lynn Hanson said some smaller businesses were holding off on hiring staff.

“People are cautious at the moment, but we are already seeing it change. The job market, however, is a resilient beast. It comes in ebbs and flows.”

Talent ID Recruitment branch manager Holly Oppers said some skilled applicants struggled to find work in some industries.

“This isn’t across all industries. There have been an increase in applicants – multiple reasons, with influx of migrants, some restructures and redundancies.

“But the majority are candidates in jobs that they are unhappy in looking for growth or better culture and salaries.”

Success Group managing director Graham Rodgers said if job-seekers were prepared to do anything for an income, there were always opportunities.

Van Syp was also aware of some companies in its industry that “have gone under”.

“There are smaller ones dying left, right and centre.

The agencies said the downturn was not affecting all parts of the economy, with sectors such as civil, manufacturing and production still hiring.

Nurses, doctors and allied health professionals were in demand, as were accountants, administration/payroll staff and project managers, workers in HR and health and safety, and duty managers.

Despite the increase in job applicants, some Bay of Plenty businesses were still finding it hard to fill positions.

‘This is about the third cycle we have gone through’

Cobweb Scaffolding owner John Watson’s staff numbers have shrunk from 17 to six as work “slowed down” and people moved across the ditch to Australia, where scaffolders could earn $65 an hour.

“You can’t compete with that,” he said.

Watson had not replaced employees when they left, but he needed a Class 2 truck driver with or without scaffolding experience.

“There’s nobody out there with experience, and certainly not the drivers.”

Watson had been scaffolding in Tauranga for more than 40 years and faced previous economic downturns.

“This is about the third cycle we have gone through, and you just need to keep your arse covered, really, as that is the key to it all.”

Another Bay of Plenty employer was back on the tools doing night shifts because he couldn’t find one fulltime or two part-time workers.

The man, who owns a cleaning company and asked not to be named, had given up and said he would wait until the kiwifruit season finished to try again.

“There are some people that would never put their hands down a toilet bowl to clean it. I was one of them… but when I look back at what I’ve achieved, it’s quite satisfying.”

DIY video outperforms job ad

Another Bay of Plenty company in dire need of a skilled technician has created a DIY social media recruitment video and prize-finder – and through that has fielded more replies than six weeks of online paid advertising.

Aaron Judd, from Telfer Marine in Rotorua, said despite sales in its boat showroom slowing, the company was looking for a new team member.

“Because new boats are difficult to sell at the moment, we’re focusing on the workshop. People are still spending money on repairs or maintenance, and we’ve recognised that.”

The video was filmed on a phone by his office manager and posted on Facebook last week.

Rudd said the company needed an industry-qualified marine, boats or trailer technician, which was hard because it was a specialist trade.

‘Workers focused on job security’ as labour market deteriorates

ANZ economist Henry Russell said the bank expected labour market conditions to deteriorate, with the forecast 5 per cent unemployment rate to rise next year.

Businesses had reported it was easier to find skilled and unskilled labour “than it was during the Global Financial Crisis, where the economy experienced widespread job losses”.

Growth in the workforce has been the key driver, but that was likely to change moving forward as the impacts of the past slowdown in economic activity flow through to the labour market.

Domestic inflation remained elevated and until the Reserve Bank had concrete evidencedomestic inflation pressures had been beaten, it would not be able to lower interest rates.

“For households, it is those with mortgages who are bearing the brunt of the impacts, and as the economy slows, confidence remains depressed and unemployment rises, the impacts will broaden to other groups.”

Westpac economist Satish Ranchhod expected a slowdown in wage growth with softening economic activity as fewer businesses hired new staff.

“We’ve also seen a drop in staff turnover, with workers increasingly focused on job security. We’ve seen particular softness in parts of the retail and construction sector.

“Businesses linked to the international tourist market have fared better as international visitors continue to climb.”

Job applicant numbers skyrocket as recession hits

Seek NZ Employment Report data showed nationally, the number of job ads in March fell by 0.4 per cent but dropped 27 per cent year on year.

In the Bay of Plenty, job ads increased by 1 per cent in March compared to February and fell 22 per cent year on year.

Seek NZ country manager Rob Clark said during a recession, it tended to see a slowdown in hiring in some industries, as employers tightened their belts and revisited discretionary roles.

“Applications per job ad are at very high levels and now 114 per cent higher than this time last year, which is not as positive for candidates … competition is fierce.”

MSD job-seekers to be offered work before low-skilled visa migrants

Ministry for Social Development Bay of Plenty regional commissioner Jacob Davies said getting people into jobs was its priority and it would be working more with clients.

From June, it would start checking in with people who had been receiving a Jobseeker Support benefit for six months and working alongside community groups, local government and employers.

Changes to the Accredited Employer Work Visa would also create opportunities for lower-skilled roles. .

Davies said there were retail, tourism, hospitality, horticultural and healthcare jobs that included front-of-house people, orchard workers, experienced forklift drivers, and care support.

The Government had also announced reducing the number of people receiving Jobseeker Support was one of its nine targets.

According to its data, there were 18,459 people on Jobseeker Support in the Bay of Plenty Work and Income region in March, compared to 17,601 in March 2023.

Nationally, numbers had jumped to 187,986 people from 168,498 – an increase of 19,488 job-seekers.

Social Development and Employment Minister Louise Upston said the ministry was working on mandatory reapplication for Jobseeker benefits every six months, community-provided job coaching, new non-financial sanctions, and a traffic light system to help job seekers comply with their work obligations.

It had set a target of 50,000 fewer people on Jobseeker Support benefits by 2030.

Carmen Hall is a news director for the Bay of Plenty Times and Rotorua Daily Post, covering business and general news. She has been a Voyager Media Awards winner and a journalist for 25 years.