People aged 15 - 24 make up almost half of the tens of thousands of New Zealanders recently made unemployed. Photo: JES2UFOTO
New unemployment figures show 33,000 more New Zealanders are jobless compared to this time last year, bringing the total to 143,000.
The unemployment rate reached a three-year high of 4.6 percent in the three months ended June, up from a revised 4.4 percent in the previous quarter.
Figures released on Wednesday showed people aged between 15 and 24 who make up almost half of the newly unemployed, and that many of them want more work but cannot get the hours.
A youth worker says many young people are trying to find a job but it is "really hard" and the difficulties are creating widespread feelings of "hopelessness".
Young people make up half of unemployment increase
"There's a myth out there that young people don't want to be employed and don't want to be doing something meaningful with their lives," Aaron Hendry of youth development charity Kick Back told Checkpoint.
"The reality is [they're] really working hard to try and find employment. They're sending their CVs out, trying to do courses to train and upskill themselves, they're just not getting much success. They're applying and are just not hearing back, or they go to interviews and they're not treated very well in those.
"It's having a real impact on their mental health, their wellbeing, their hope for their future. It impacts on their sense of self - they experience feelings of worthlessness and can feel like they don't really have a place in our community."
Kiwi Bank chief Economist Jarrod Kerr told Checkpoint that New Zealanders could expect more people to be joining the unemployment queue in the coming months, too.
"Things are going to get worse before they get better," Kerr said
"The unemployment rate lags what's happening in the economy, so it's going to continue to lift from here and break through 5 percent by the end of this year, which is enough to bring inflation back down. We've all grown in confidence that inflation will fall below 3 percent this year, then get back to 2 next year."
As the unemployment rate rises and inflation falls, the cost-of-living crisis should ease, which should make paying bills easier for many New Zealanders. But that will be cold comfort to those made unemployed or unable to find work at all.
"The Reserve Bank is simply trying to take what was a heated economy and cool it down. Unfortunately part of that is getting businesses to slow down and reduce headcount," Kerr said.
"[Young people] might be some of the last people you've hired and are probably some of the first that you have to let go. Unfortunately, the bulk of [those recently made unemployed] has been the younger workforce."
33,000 more Kiwis unemployed compared to last year
Hendry said a lot of the young people Kick Back works with did not have decent security with the jobs they were able to work in, if they were able to get them. The contracts were generally less beneficial than those many older workers sign onto, he said.
To make things worse, Hendry said benefits were being cut for some young people trying to find work, forcing them to instead deal with more immediate issues such as potential homelessness.
"Unfortunately some of the decisions being made around how we manage benefits and the tougher approach around sanctions is also getting in the way. It's making things harder for some young people as they're trying to find work," Hendry said.
"Things have gotten harder. Young people have been sanctioned because they haven't been able to pick up their phone or haven't had a phone - that's had an impact on their ability to stay housed. They're having to deal with how to get into WINZ or how to find housing ... it leads to further crisis and further harm.
"We need more support for young people, especially more transition into work support."
As for when things will start to get better, Kerr believed the economy's recovery was about to accelerate. He said we should expect "a lot" of cuts to the Official Cash Rate, predicting it would fall from 5.5 to 2.5 over the next year and a half.
"We have been in recession for two years now. I think enough is enough and it's time for the Reserve Bank to start moving the other way. I'm recommending they start cutting next week, but I don't think they will. I think they'll wait until October or November."
Also in the quarterly data released on Wednesday was the level of underutilisation - a measure of slack in the jobs market - rising to 11.8 percent from 11.2 percent.