Higher job confidence tinged with concern for NZ's economic prospects, survey finds

Confidence in the labour market has risen slightly, with more people optimistic about their current employment prospects but there's concern about what the future may hold.

The Westpac McDermott-Miller Employment index for the March quarter rose by about 2 points on the previous survey to 99.5.

The survey showed that fewer people were pessimistic about their current employment prospects, more people felt secure in their employment, and there was increasing optimism about future wage growth.

Westpac acting chief economist Michael Gordon said the rebound in confidence out of the last year's lockdowns had been swift, but the pace of the recovery was losing momentum.

"The labour market is still some way from pre-Covid levels - unemployment has risen, jobs are harder to find, and the pickup in wage growth that was developing by the end of 2019 has since lost steam."

One of the more concerning findings from the survey was that people's perceptions of future job opportunities had fallen over the period.

"I think it's something that's come through a bit in some of our other surveys like consumer confidence where there is a little bit of nervousness about how the economy's tracking, particularly as we're going through this summer of no overseas tourists.

"That is weighing on activity and some parts of the country more than others."

Jobs listings have surged over the three months to March, but the types of jobs offered have been uneven with openings in the trades sector significantly higher than those in retail and hospitality.

"It does raise the prospect of skill mismatches," Gordon said.

"Sectors like construction have been really making hay so they've got a lot of demand on and they're not having to compete to attract workers to the same extent they were before.

"But within that you've kind of had this wrenching change where people are maybe able to get jobs but not in the area that they would like to be in."