NEW ZEALAND’S isolation could be a safety net for workers in the face of the worsening European debt crisis.

A positive trend in employment recovery since the recession should be maintained despite the international problems, say two experts spoken to by Newswire.

Dr Stephen Burnell of Victoria University says any downturn will not be as bad as the last one for New Zealand, while Employers and Manufacturers Association spokesperson Gilbert Peterson says our Australasian trading partners will cushion any blow.

In August this year filled jobs were up 2.1% compared with August 2010, an annual change of 39,128, according to the latest National Employment Indicator (NEI) from Statistics New Zealand.

New Zealand shed jobs between December 2008 and July 2010.

Since then the trend has remained positive, and August this year had the largest annual percentage increase since April 2008.

Filled jobs were up 1.1% in August compared with July this year, with an increase in the total number of people employed from 1,909,797 in July to 1,929,892 in August – a rise of 20,095.

Even though current figures are positive, the number of filled jobs is still about 50,000 less than in January 2008, which had the largest number of people in jobs (1,978,742) in the past eight years.

Mr Peterson, communications manager for the Employers and Manufacturers Association, says though events in Europe and the US will affect the prices we can get for New Zealand products, we are insulated from these events as our largest trading partners are Australia and China.

“Both these countries have been doing far better than most European countries and the US. But Australia has suffered a setback recently and market conditions there will play a large part in how the New Zealand economy fares now.”

“My pick is the steady though slow recovery will keep on.”

Commodity prices have been high and other exports have continued growing slowly despite the volatile exchange rate.

“So we are seeing some expansion in manufacturing employment and in part of the services sector – but not yet in construction or retail,” he says.

Mr Petersen attributes this years dip in employment to the extreme uncertainty in world markets, largely exacerbated by Greece’s threats to default and from the continuing financial woes of the US.

The height of these fears occurred around mid-year, but they seemed to be easing around August/ September, until the events again of the last few days.

“Uncertainty on this sort of scale can cause every employer to sit tight until they can see what is going to happen.”

The Rugby World Cup in September and October no doubt helped the confidence of some businesses in Auckland and Wellington, says Mr Petersen.

Dr Burnell, senior lecturer in the School of Economics and Finance at Victoria University, says it is usual for employment growth to take off after a recession.

He says another recession is not likely, but it could happen.

“It will be bad for the US and Europe, but in New Zealand it should not be as bad as the last one.”

He says the September Quarterly Employment Survey shows that filled jobs were up 0.6% in September 2011 compared with September 2010, so employment should continue to grow, but not at the high level reported for August.

The NEI uses tax data from Inland Revenue to measure national changes in total filled jobs each month.

All of the data is seasonally adjusted, in order to remove the impact of seasonal events, such as public holidays or agricultural cycles, so the months are more comparable.

The NEI measures filled part-time or full-time jobs over each month, not the number of people employed, which means that a person with multiple jobs is counted multiple times.

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