It seems an aeon ago, but it was only last week that New Zealand’s wellbeing-focused government was contemplating how to connect the country safely with the rest of the world. Now, achingly, the question is how long the lockdown will last.
Whereas last week the headlines (like this one from Newsroom) chorused “Covid success weighs on Ardern’s shoulders”, feelings among the team of 5 million might now be deepening over why such a relatively small percentage of the population is fully vaccinated.
Or why the elderly, in particular, are not queueing for booster shots.
NZ, by some counts, has had the slowest vaccination rollout in the developed world.
The PM’s insistence that her government’s Covid response and recovery path has been dictated by the “best evidence we have about how to protect people’s lives and livelihoods’’ accordingly rings a bit hollow.
We might to have to wait to get the true picture, not just on the mood of the nation, but also on what damage the Covid Delta variant outbreak will do to the economy.
Only last week Finance Minister Grant Robertson was telling Parliament the government’s efforts to secure the recovery are being reflected in the jobs market.
He cited ANZ’s confidence composite gauge, which is a GDP growth indicator by combining lag business expectations and intentions with consumer sentiment, as being well above pre-COVID levels.
Robertson added that the primary sector is continuing to support and secure the recovery. The ANZ Commodity Price Index had eased back from its record high, declining by 1.4% in July, but “ it is still very strong”.
On the employment picture, Robertson said that for the fifth month in a row, the SEEK NZ employment report shows a record-breaking number of jobs advertised, with job ads increasing by 2% in July from the previous month. For the year, job ads rose 88% while job ad numbers are now 27% above pre-COVID highs.
“Unemployment has fallen to 4%, reflecting the stronger than expected economic activity and an economy operating above pre-COVID levels”.
Robertson appeared to savour NZ’s success by contrasting it with the signs of a moderating pace of growth at above-trend levels in the OECD area.
“The latest indicators point to signs of a moderating pace of growth in the US, Japan, and Canada. Similar indications have emerged in the UK and in the euro area as a whole, including in Germany and Italy. In France, there are also signs of a moderating pace of growth with its indicators still below trend”.
He concluded that all of this
“… indicates that the NZ economy operates in a very uncertain and volatile global context and in one in which it’s important that we remain nimble and agile”.
The length of the lockdowns could put a bit of a hobble into that agility.
Given that elements of the tourism industry already struggling to survive might be delivered a death blow by the latest lockdown along with the burst Trans-Tasman bubble , Robertson’s celebration of NZ’s unemployment rate touching 4% might be premature.
Critics who have looked closely at the unemployment statistics have noted some other worrying trends: for example, rises in the number of young people not in employment, education or training. There have also been increases of those on jobseeker benefits.
For many New Zealanders it is baffling that at the same time as industries are desperate to find workers, the number of people on benefits (including the jobseeker benefit) is 40,000 higher than before Covid struck.
Another concerning trend in the labour market, as measured by Statistics NZ, is the “under-utilisation” rate, which in the official jargon gives “a broader measure of untapped capacity”. It stood at 315,000, or 10.5% of the workforce, in the June quarter.
Still, New Zealanders can rely on Robertson to punctuate the encircling gloom with some rays of light even as the lockdown ominously heads for further extensions.