Unemployment rate highest in a decade as it rises to 5.4%

• Unemployment rises to 10 year high of 5.4 percent
• 15,000 jobs added in quarter, but workforce and job hunters grow
• Underutilisation rate steady at five year high of 13 pct
• Youth unemployment rises, more woman in the labour force
• Annual wage growth slows to near five year low of 2 percent
• Data worse than expected, backs the RBNZ holding cash rate steady in two weeks

Unemployment rose to its highest level in more than a decade, with more people chasing work than jobs created, while wage growth slowed further.

Stats NZ numbers showed the unemployment rate rising to 5.4 percent in the three months ended December, from 5.3 percent in the previous quarter. It was the highest level since March 2015.

"Over the quarter, we saw higher levels of engagement in the labour market as both employment and unemployment increased," macroeconomic spokesperson Jason Attewell said.

A total of 165,000 people were unemployed, a rise of 4000 on the previous quarter and 10,000 on a year ago.

The data was worse than forecast by economists and the Reserve Bank.

Unemployment has been steadily rising as businesses either sacked staff or stopped hiring because of the weak economy, while the workforce has increased despite a slowdown in migration.

The level of underutilisation, including the unemployed and under-employed, used as a measure of slack in the jobs market, held at 13 percent, the highest rate since late 2020.

The number employed increased by about 15,000 in the quarter, the strongest quarterly growth in two years, however, the economy still had more than 30,000 fewer jobs than two years ago.

The level of unemployment of people between 15 and 24 years was 16.5 percent, with the total not in education or training falling to 13.7 percent.

Stats NZ said there was a noticeable increase in the number of women in the labour force, with another 20,000 joining in the quarter, many going into part time employment.

The regions with the highest unemployment were Auckland, Wellington and Waikato with rates close to 6 percent, with all South Island regions below 5 percent.

The broad measure of wages showed overall growth slowing to a four year low of 2 percent from 2.1 percent, compared with a 3.1 percent rise in consumer prices.

The data was above Reserve Bank forecasts and backs the central bank holding the official cash rate at 2.25 percent later this month.