5 Nov 2012

Unemployment likely to remain high

6:49 am on 5 November 2012

Unemployment is likely to remain stubbornly high amid a lack of confidence among employers to hire more people in an uncertain economic environment.

The Labour Cost Index and Quarterly Employment Survey for the September quarter are out on Tuesday providing official figures on wages, employment and hours worked, while the Household Labour Force survey which provides unemployment statistics is released on Thursday.

A Reuters news agency poll of economists is picking the jobless rate to edge down slightly, to 6.7%.

Infometrics economist Matt Nolan said the labour market is likely to remain sluggish for some time.

"The main thing is it will stay in that range, that above 6.5% up to about 7% range it's been for three years and when you've got unemployment like that it does point to a weak labour market."

Mr Nolan said hiring someone is an investment even on a short term basis but there is uncertainty in Europe and weak demand from consumers and employers feel uncertain and so are not willing to employ people.

He said a lot of the growth that has been seen this year has been in agriculture but the economy needs to be stronger in a broader range of sectors before employers will begin hiring.