ANNUAL IN-DEPTH REGIONAL REPORT - Gisborne and Hawke’s Bay Regions
LABOUR MARKET OUTCOMES
In the previous section, we outlined the skill development of youth in Gisborne and Hawke's Bay Regions. This section looks at the labour market outcomes for youth in Gisborne and Hawke's Bay Regions.
Section 3.1 looks at the rate of labour force participation for youth as well as identifying causes for the change in participation over time. Section 3.2 identifies the industries and occupations in which youth are employed, as well as how this has changed over time. It also looks at the size of businesses that youth are employed in and how the pattern of full-time and part-time employment changes for youth. Section 3.3 looks at youth unemployment across the region, and Section 3.4 looks at the income of youth.
Labour force participation
The labour force participation rate is the proportion of the working-age population (people 15 years old and above) who are willing to work, are working or are actively looking for work, i.e. engaged in the labour force. As it is common for many 15-24 year olds to be involved either in school education or further education, the participation rate for this age group tends to be lower than for other age groups. Over the past decade, there has been a national trend towards lower participation among 15-24 year olds, as increasing proportions engage in further study. This is positive over the longer term as those furthering their education are investing in skills to bring to the labour market in future.
Chart 9 shows the labour force participation rate for the combined area of Gisborne and Hawke's Bay Regions. The data for Chart 9 comes from the Household Labour Force Survey (HLFS), which aggregates these two regions to enhance data quality. The annual average labour force participation for Gisborne and Hawke's Bay Regions has been relatively volatile between 1988 and 2008; however, it has grown strongly over the period. This long-term growth in participation rate has meant that the regional rate is now very similar to the national rate.
For information about the latest labour force participation rate in Gisborne and Hawke's Bay Regions, check out the Joint MSD/DoL Quarterly Regional Reports - http://www.dol.govt.nz/publications/
lmr/regional/joint/Gisborne%2
0Hawkes%20Bay.pdf.
Source: Household Labour Force Survey, Statistics New Zealand
Charts 10A and 10B show the change in the actual number of people in the labour force between 2001 and 2006 and the influence that population growth and participation ages has had. Where the two bars for each age group are at different levels, the difference is caused by a change in the rate of labour force participation. The results for the two regions in this report differed between 2001 and 2006 for youth.
Data for Gisborne Region shows that most of the growth in the labour force of 15-19 year olds was due to a growth in this population - there was only a very small increase in the rate of labour force participation. For 20-24 year olds, a different pattern existed, with the population of 20-24 year olds actually declining while the labour force of 20-24 year olds actually increased slightly. This means that the participation rate of those 20-24 year olds in the region must have increased.
Data for Hawke's Bay Region shows that labour force growth of 15-19 year olds was due to a combination of both population growth and an increase in the rate of participation in the labour force. For 20-24 year olds in Hawke's Bay Region, the labour force growth was almost entirely due to participation rate increases, as the population of this age group barely changed, while the labour force grew by over 250.
While not the subject of this report, Chart 10 shows that much of the growth in Gisborne and Hawke's Bay Regions' labour force participation rate (seen in Chart 9) was caused more by older people participating in the labour force.
Source: 2006 Census of Population and Dwellings, Statistics New Zealand
Source: 2006 Census of Population and Dwellings, Statistics New Zealand
Table 6 shows how changes in the youth population and youth labour force combine to determine the youth participation rate. If the youth labour force increased at a rate greater than the youth population between 2001 and 2006, the participation rate increased. This result occurred for all TAs in Gisborne and Hawke's Bay Regions. In contrast, the youth population in New Zealand had increased faster than the national youth labour force. As a result, the national youth participation rate fell slightly, by 0.5%, between 2001 and 2006.
In 2006, the youth participation for Gisborne Region was 63.8% and the youth participation rate for Hawke's Bay Region was 70.9%. In comparison, the national youth participation rate was 66.4%. Across Hawke's Bay Region, Napier City had the highest participation rate in 2006, at 73.1%, while Wairoa District had the lowest youth labour force participation rate at 64.1%. .
| Change in 15-24 year olds (2001-2006) [18] | Participation rate (%) | Change in the 15-24 year old labour force population (2001-2006) | ||
|---|---|---|---|---|
| 2001 | 2006 | |||
| New Zealand | 11.9% | 66.7% | 66.4% | 11.4% |
| Gisborne Region | 1.5% | 62.9% | 63.8% | 3.0% |
| Hawke's Bay Region | 4.9% | 68.1% | 70.9% | 9.2% |
| Wairoa District | -4.8% | 60.7% | 64.1% | 0.5% |
| Hastings District | 7.8% | 67.3% | 70.0% | 12.2% |
| Napier City | 4.4% | 70.1% | 73.1% | 8.9% |
| Central Hawke's Bay District | -3.0% | 68.6% | 70.3% | -0.6% |
Source: 2006 Census of Population and Dwellings, Statistics New Zealand
What is your view of the level of the participation rate - do you think it should be lower as long as the people are engaged in education and furthering their skill development?
Employment
Employment by business size
This section looks at the proportion of young people working in varying sizes of businesses in the regional economy (in terms of the number of people they employ). By looking at employment disaggregated by business size, we can identify important characteristics. For example, if youth are heavily clustered in large businesses, one-off closures can cause significant numbers to be potentially unemployed. Conversely, employment in major businesses may have more funding available for formalised training opportunities for staff than small businesses. The OECD report that "...employees from small and medium enterprises (SMEs) are less likely to participate in training programmes than employees in large enterprise."[19]
In Gisborne Region, employment was concentrated in smaller firms. In 2006, 47% of all Gisborne Region youth who worked were employed in businesses with less than 20 staff - this compares with 38% of youth nationally. The pattern of youth employment is generally determined by the business sizes in the region - there is generally little difference between the size of businesses employing youth and the businesses who employ all regional workers. For all people employed in Gisborne Region, 46% were employed in businesses with fewer than 20 staff.
The employment pattern for youth in Hawke's Bay Region by business size was virtually identical to national youth employment patterns. Again, like Gisborne Region, much of the employment pattern is due to the sizes of businesses in the region rather than any clustering of youth in particular types of businesses. Like most of the rest of the country, the highest share of employment was in businesses with 100 or more employees. While there weren't necessarily many of these businesses in the region, because each one employs so many people, they account for a large share of total employment.
| New Zealand | Gisborne Region | |
|---|---|---|
| Self-employed | 2% | 1% |
| 1-5 | 15% | 18% |
| 6-9 | 9% | 12% |
| 10-19 | 13% | 16% |
| 20-49 | 14% | 14% |
| 50-99 | 8% | 7% |
| 100 + | 39% | 32% |
Source: Linked Employer-Employee Dataset (annual tables), Statistics New Zealand, 2006 tax year
Across Hawke's Bay Region, the employment pattern of youth by business size differed. Youth in more rural areas such as Wairoa District and Central Hawke's Bay District were more likely to be employed in small businesses of less than 10 employees, than youth nationally. On the other hand, youth in more urban areas such as Napier City and Hastings District were more likely to be employed in medium sized businesses of 6-49 employees, than youth nationally.
Source: Linked Employer-Employee Dataset (unpublished annual tables), Statistics New Zealand, 2006 tax year
Number of jobs held
Across New Zealand, 5.9% of 15-24 year olds had more than one job[20] in 2006. This was slightly above the proportion for all age groups, which stood at 5.0%. In comparison, 6.2% of youth aged 15-24 years old in Gisborne Region and 6.0% of youth in Hawke's Bay Region had more than one job. Because of the similarity of the data to the total population, it is not presented here.
Employment by industry and occupations
This section looks at the number of young people working across the various industries and in occupations in Gisborne and Hawke's Bay Regions and the changes that have occurred since 2001. This shows in which industries and occupations 15-24 year old employees were mainly employed and identifies the changing prevalence of employment in different industries and occupations.
In 2006, the Agriculture, Forestry and Fishing industry employed the most people (19.7% of total employment, 3,531 people), followed by Retail Trade (12.4% of total employment, 2,235 people). Between 2001 and 2006, the fastest growing industry for the total Gisborne Region population was Mining (83.3% growth), although this growth was based on a fairly small number (33 employees). Of the industries with over 1,000 staff, Construction employment grew the fastest at 42.1%, followed by Property and Business Services at 34.5%.
In Gisborne Region, Retail Trade was the big employer of youth. In 2006, 21% of youth worked in Retail Trade, with 20% working in Agriculture, Forestry and Fishing. While still a large employer of youth, agricultural employment declined by 20% between 2001 and 2006. Construction and Manufacturing added the most youth workers between 2001 and 2006, adding 129 and 87 youth staff respectively.
While youth employment in retail trade and accommodation, cafes and restaurants is consistently high across New Zealand and in both Gisborne and Hawke's Bay regions, the majority of employment of youth in these two large industries was part time. Contrasting this, youth employed in Agriculture, Manufacturing and Construction were working almost entirely full time in 2006.
Regional sources suggest that skill shortages exist across managerial, ICT and specialist medium to high skilled roles within these industries.
A detailed version of Table 8A showing industry employment for 15-19 and 20-24 year olds residing in Gisborne Region is provided in Appendix 2.
Source: 2006 Census of Population and Dwellings, Statistics New Zealand
In 2006, the largest employing industries for the working-age population in Hawke's Bay Region were Manufacturing (14.8% of total employment, 9,966 people) and Agriculture, Forestry and Fishing (14.3% of total employment, 9,693 people). Between 2001 and 2006, Construction experienced the greatest employment growth at 53.7% (1,827 people) followed by Property and Business Services at 37.3% (1,758 people)[21].
The largest industries of employment for youth in Hawke's Bay Region were Retail Trade (24.9% of youth employment and 2,472 people) and Agriculture, Forestry and Fishing (15.0% of youth employment and 1,488 people). Numerically, the Construction, and Accommodation, Cafés and Restaurants industries added the most youth to their workforces between 2001 and 2006 with 471 and 318 additional staff respectively.
A detailed version of Table 8B showing industry employment for 15-19 and 20-24 year olds residing in Hawke's Bay Region is provided in Appendix 2.
Source: 2006 Census of Population and Dwellings, Statistics New Zealand
Charts 12A and 12B show the proportion of youth in each industry for Gisborne and Hawke's Bay Regions as well as the national share of youth in these industries. Compared to the national average, there were a greater proportion of youth employed in Agriculture, Forestry and Fishing, and Manufacturing in Gisborne Region. In all other industries, the share of youth in Gisborne Region was smaller than the national average share of youth. This indicates that the workforce in Gisborne Region was older than average. Regional sources suggest professions in short supply are trades, health clinicians (in particular, registered nurses and general practitioners), social workers and teachers (particularly bi-lingual).
Source: 2006 Census of Population and Dwellings, Statistics New Zealand
Youth in Hawke's Bay Region were also more likely to be employed in Agriculture, Forestry and Fishing, and Manufacturing compared to the national share of youth. Compared to data for Gisborne Region in Chart 12A, the differences between Hawke's Bay Region and national shares of youth employment in each industry were generally smaller, suggesting that while Hawke's Bay Region is likely to have an older than average workforce, the difference is not as large as in Gisborne Region.
Source: 2006 Census of Population and Dwellings, Statistics New Zealand
As shown in Table 9A, a large proportion of the total working-age population in Gisborne Region in 2006 were employed as Agriculture and Fishery Workers (15.8%), Professionals (13.7%) and Service and Sales Workers (13.6%).
Between 2001 and 2006, employment of the working-age population grew the fastest amongst the higher skilled occupations in Gisborne Region. Employment of Technicians and Associate Professionals grew by 21.0% between 2001 and 2006, followed by Legislators, Administrators and Managers, which grew by 19.5% over the same period.
Youth employment in Gisborne Region was focused on similar occupations to that of the working-age population. Nearly 700 youth in Gisborne Region were employed as Service and Sales Workers in 2006, followed by 480 youth employed as Agriculture and Fishery Workers. The employment group that grew the fastest between 2001 and 2006 (in terms of numbers of employees) was Trades Workers, which grew by 123 over the period. While Agricultural and Fishery Workers was the second largest occupation for youth, it declined substantially between 2001 and 2006 - down over 20%, with nearly 130 youth less in employment in 2006. This reduction of employment in both Agriculture industry employment and the employment of agricultural workers is a pattern that was seen across the country between 2001 and 2006, likely linked to the increased conversion of farms towards dairy farming.
Detailed versions of Table 9A and 9B showing employment by occupation for 15-19 and 20-24 year olds residing in Gisborne and Hawke's Bay Regions are provided in Appendix 2.
Source: 2006 Census of Population and Dwellings, Statistics New Zealand
Employment of the working-age population of Hawke's Bay Region was evenly spread across the different occupations - in fact, one of the most evenly spread in New Zealand in 2006. The largest occupation group within Hawke's Bay Region was Service and Sales Workers in 2006, with nearly 10,000 people working in this occupation group. The second largest occupation was Professionals, with over 8,600 employees.
Between 2001 and 2006, all occupations other than Agriculture and Fishery Workers increased. The largest growth in numbers employed was amongst Elementary Occupations, growing by over 3,200 in Hawke's Bay Region between 2001 and 2006, followed by Legislators, Administrators and Managers, which grew by just over 2,000 workers.
The youth employment pattern within Hawke's Bay Region by occupation differed from that of the total population. Just over a quarter of youth were employed as Service and Sales Workers, and a large proportion of youth were further distributed across a number of lower-skilled occupations, including Elementary Occupations, Agriculture and Fishery Workers, and Plant and Machine Operators and Assemblers.
Youth employment in Trades Worker occupations grew the fastest in Hawke's Bay Region between 2001 and 2006, adding nearly 450 more staff over the period. The growth in this occupation correlates well with the strong growth in the Construction industry between 2001 and 2006.
Source: 2006 Census of Population and Dwellings, Statistics New Zealand
Charts 13A and 13B show the share of youth in the region and New Zealand to each occupation's employment. For example, in Chart 13A youth in Gisborne Region contributed around 5% of Professionals employed in the region. Nationally, youth contributed about 7% of all Professionals employed. Across most of the occupations, youth in Gisborne Region contributed a smaller than average share of those employed. This result replicates the findings in Chart 12A, again suggesting a workforce with a lower share of youth. Youth had a higher than average share of employment in the lower skilled occupations of Agriculture and Fishery Workers, Trades Workers and Plant and Machine Operators and Assemblers.
Source: 2006 Census of Population and Dwellings, Statistics New Zealand
Similar patterns for low skilled occupations were observed in Gisborne as well as Hawke's Bay Region. Youth in Hawke's Bay Region made up a smaller than average share of each occupation's workforce for all but two of the low skilled occupations. An interesting feature of both charts is the smaller than average shares of youth employed as Service and Sales Workers in the regions. This under-representation indicates that older workers in the regions filled these roles at a greater than average rate.
Source: 2006 Census of Population and Dwellings, Statistics New Zealand
Do the occupations of youth data match your experience? Do you think the pattern of employment could be improved - would intervention help? Are there any current interventions in place in Gisborne and Hawke's Bay Regions?
One of the ways in which employment patterns of youth vary from that of the working-age population is the rate at which young people work in part-time employment. This characteristic is also one that changed markedly between 15-19 year olds and 20-24 year olds, as shown in Table 10.
Compared to the national average, a slightly larger proportion of people aged 15 and over in both Gisborne and Hawke's Bay Regions were employed in part-time employment in 2006.
Youth in Gisborne Region were more likely than average to be working full-time. This is a common feature of regions without large tertiary training providers and also reflects the employment patterns of the major industries of youth employment in the region.
Youth in Hawke's Bay Region were also more likely than youth nationally to be working full-time, although this result varied across the TAs of the region. Particularly high rates of full-time employment were seen for youth aged 15-19 in both Wairoa and Central Hawke's Bay Districts. Youth aged 15-19 in Napier City had a lower than average share of full-time employment, potentially reflecting a continued education of these youth.
In contrast, youth aged 20-24 across Hawke's Bay Region were more likely than average to be working full-time, with these youth in Central Hawke's Bay District having particularly high rates of full-time employment (87.2% in 2006). These high rates of full-time employment reflect the results seen in Chart 8, which showed high levels of employment only, especially in Central Hawke's Bay District. This high rate is likely to be due to an absence of provision or demand for tertiary training in the area.
Source: 2006 Census of Population and Dwellings, Statistics New Zealand
What is driving the pattern of full-time/part-time youth employment in your region? Do you believe this pattern has changed/will change over time? Is this a good thing?
The employment rate[22] is an important indicator of the economic welfare of the country. Work leads to higher income, which, over time, can bring financial independence and a better standard of living and associated social benefits for the individual and wider community. While the employment rate reflects the number of jobs, there are other things to consider, such as the quality and sustainability of jobs. Rising employment is one of the clearest indications that the labour market is working successfully. Over time, as labour shortages increase and participation and employment rates stabilise, labour productivity improvements become increasingly important.
Data for Chart 14 comes from the Household Labour Force Survey (HLFS). This survey combines data for Gisborne Region with data for Hawke's Bay Region to generate enough data to produce reliable results. This means that any data published from the HLFS will be for the combined region.
As shown in Chart 14, the annual average employment rate of the working-age population has fluctuated considerably over the duration of the survey. While there has been this variability, the employment rate of the combined region has steadily closed on the national employment rate. The employment rate for the combined Gisborne and Hawke's Bay Regions was 64.7% in the year to March 2008, below the national average employment rate in this period, at 65.9%.
| Quarter | Gisborne/Hawke's Bay Region | New Zealand |
|---|---|---|
| Mar-88 | 59.8 | 63.3 |
| Jun-88 | 59.6 | 62.8 |
| Sep-88 | 58.6 | 62.1 |
| Dec-88 | 58.0 | 61.4 |
| Mar-89 | 57.5 | 60.7 |
| Jun-89 | 56.8 | 60.0 |
| Sep-89 | 56.8 | 59.6 |
| Dec-89 | 56.1 | 59.3 |
| Mar-90 | 55.8 | 59.2 |
| Jun-90 | 54.8 | 59.3 |
| Sep-90 | 54.0 | 59.3 |
| Dec-90 | 52.9 | 59.1 |
| Mar-91 | 52.1 | 58.8 |
| Jun-91 | 51.8 | 58.3 |
| Sep-91 | 52.0 | 57.8 |
| Dec-91 | 52.3 | 57.4 |
| Mar-92 | 52.6 | 57.1 |
| Jun-92 | 53.5 | 57.0 |
| Sep-92 | 53.3 | 56.9 |
| Dec-92 | 53.9 | 57.0 |
| Mar-93 | 54.7 | 57.0 |
| Jun-93 | 54.5 | 57.0 |
| Sep-93 | 55.6 | 57.2 |
| Dec-93 | 55.7 | 57.5 |
| Mar-94 | 55.2 | 57.8 |
| Jun-94 | 55.6 | 58.2 |
| Sep-94 | 56.2 | 58.7 |
| Dec-94 | 57.4 | 59.2 |
| Mar-95 | 58.3 | 59.7 |
| Jun-95 | 58.7 | 60.1 |
| Sep-95 | 58.6 | 60.6 |
| Dec-95 | 58.2 | 60.9 |
| Mar-96 | 58.2 | 61.2 |
| Jun-96 | 58.2 | 61.5 |
| Sep-96 | 57.9 | 61.8 |
| Dec-96 | 58.1 | 61.9 |
| Mar-97 | 58.1 | 61.9 |
| Jun-97 | 57.7 | 61.7 |
| Sep-97 | 57.3 | 61.5 |
| Dec-97 | 56.5 | 61.3 |
| Mar-98 | 55.4 | 61.2 |
| Jun-98 | 55.2 | 60.9 |
| Sep-98 | 54.7 | 60.7 |
| Dec-98 | 54.5 | 60.4 |
| Mar-99 | 55.4 | 60.4 |
| Jun-99 | 56.0 | 60.5 |
| Sep-99 | 57.1 | 60.6 |
| Dec-99 | 57.3 | 61.0 |
| Mar-00 | 57.5 | 61.1 |
| Jun-00 | 57.5 | 61.1 |
| Sep-00 | 57.5 | 61.3 |
| Dec-00 | 58.3 | 61.5 |
| Mar-01 | 59.1 | 61.8 |
| Jun-01 | 59.5 | 62.2 |
| Sep-01 | 59.9 | 62.4 |
| Dec-01 | 60.2 | 62.5 |
| Mar-02 | 60.8 | 62.9 |
| Jun-02 | 61.2 | 63.1 |
| Sep-02 | 61.8 | 63.2 |
| Dec-02 | 61.5 | 63.2 |
| Mar-03 | 61.3 | 63.1 |
| Jun-03 | 61.8 | 63.1 |
| Sep-03 | 61.4 | 63.3 |
| Dec-03 | 61.5 | 63.3 |
| Mar-04 | 61.0 | 63.5 |
| Jun-04 | 60.9 | 63.8 |
| Sep-04 | 61.0 | 64.0 |
| Dec-04 | 62.0 | 64.4 |
| Mar-05 | 62.8 | 64.7 |
| Jun-05 | 63.3 | 65.0 |
| Sep-05 | 64.0 | 65.3 |
| Dec-05 | 64.3 | 65.3 |
| Mar-06 | 64.9 | 65.5 |
| Jun-06 | 65.4 | 65.8 |
| Sep-06 | 65.2 | 65.8 |
| Dec-06 | 65.0 | 65.8 |
| Mar-07 | 64.7 | 65.8 |
| Jun-07 | 64.3 | 65.9 |
| Sep-07 | 64.8 | 65.9 |
| Dec-07 | 65.1 | 66.1 |
| Mar-08 | 64.7 | 65.9 |
Source: Household Labour Force Survey, Statistics New Zealand
The trend for the youth employment rates differed from that of the total population. On average in 2006, youth in Gisborne Region had a lower employment rate (53.2%) than youth nationally (57.6%), while youth in Hawke's Bay Region had a higher employment rate (62.2%). Across Hawke's Bay Region, a variety of youth employment rates can be seen, with Napier City and Central Hawke's Bay District having above average employment rates, while Wairoa District had a particularly low employment rate at 53.8%, similar to that of Gisborne Region. For Gisborne Region and all of the TAs in Hawke's Bay Region, the employment rate for youth grew faster than the national youth rate between 2001 and 2006. While Wairoa District had a low employment rate in 2006, it grew the fastest from 2001, growing by 8.8 percentage points over the period.
Unemployment
The unemployment rate is the proportion of the labour force that is unemployed. To be counted as unemployed, a person must be without a paid job, be available for work and have actively sought work in the past four weeks or have a new job to start within the next four weeks. Unemployment has a major influence on many decisions facing young people.
The annual average unemployment rate for the combined Gisborne and Hawke's Bay Regions stood at 4.6% in the year to March 2008, below the national average unemployment rate of 3.6% in the same period. While the regional data is more volatile than the national data, it shows a very similar long-term pattern. The unemployment rate for Gisborne and Hawke's Bay Regions has been declining since late 1992, mirroring the trend for the New Zealand working-age population in this period.
Unemployment affects the rate at which young people learn work skills such at timeliness, team work and so on that are needed throughout a person's working life. This makes unemployment of youth perhaps even more negative than for the overall population.
The youth unemployment rate for Gisborne Region, at 16.6%, was higher than the national youth unemployment rate (13.3%), while the youth unemployment rate for Hawke's Bay Region, at 12.3%, was lower than the national youth unemployment rate. Across Hawke's Bay Region, Wairoa District had the highest youth unemployment rate at 16.1%, while Central Hawke's Bay District had the lowest youth unemployment in the region at 9.3%. Although the unemployment rates were quite variable, they all showed significant decline between 2001 and 2006, with all TAs of Hawke's Bay Region falling by a larger rate than the national average. Wairoa District, in particular, showed a large decline in the youth unemployment rate, falling 10.4 percentage points over the period.
Source: 2006 Census of Population and Dwellings, Statistics New Zealand
Around 3% of all those who receive unemployment benefits in New Zealand (615 people in March 2008) lived in Gisborne and Hawke's Bay Regions. Of those unemployment beneficiaries in Gisborne and Hawke's Bay Regions, around 15% were aged 24 or under.
For information about the latest unemployment rate in Gisborne and Hawke's Bay Regions, check out the Joint MSD/DoL Quarterly Regional Reports -
http://www.dol.govt.nz/publications/lmr/
regional/joint/Gisborne%20Hawkes%20Bay.pdf.
Does the unemployment pattern match what you have seen in the region? If not, why not? What do you think is likely to happen to youth unemployment in the next few years?
Earnings
Earnings (and, to a smaller extent, total income) are influenced by both the labour market conditions and the productivity of workers. Wages (and earnings) are the result of interactions between employers and workers and are influenced by such things as the skills and experience the workers possess and the value that workers add. It should be noted that low skill jobs generally tend to have low median hourly earnings while high skills jobs generally have higher median earnings.
Across New Zealand, a slightly higher proportion of youth received some income[24] from income-tested benefits than other groups, whilst those receiving income from self-employment was significantly lower than the New Zealand average. Looking at data for Gisborne and Hawke's Bay Regions' 15-24 year olds shows that the only difference with the average for 15-24 year olds in New Zealand was that Gisborne and Hawke's Bay Regions youth were slightly more likely to receive a benefit.
As reported in the 2007 AIDR, the median hourly wage rate within Gisborne and Hawke's Bay Regions has been consistently below the national average (although it must be remembered that only Wellington and Auckland tend to have higher than the national median wage rates).
The Linked Employer-Employee Dataset (LEED) captures data on income from salaries and wages, which shows marked differences by age. Overall, young people tend to have significantly lower incomes than the rest of the working-age population, influenced in part by the high share of part-time youth employment described in Section 3.1. Other reasons for lower than average earnings are:
- less time on average in the job
- less seniority
- lower workplace skills.
Further information on low youth earnings can be found in the OECD Youth report[25], including findings that youth:
- stay in their early post-education jobs for a much shorter tenure
- have a particularly high turnover in jobs
- have 'entry' jobs that have little relationship to training.
Data from the 2006 Census of Population and Dwellings shows that 42% of all 15-24 years old employed in New Zealand had income of $5,000 or less, about 29% had income between $5,000 and $20,000, and a further 29% had income over $20,000[26]. In 2006, a larger than average share of Gisborne Region youth (43%) earned less than $5,000, and a larger than average share (33%) earned between $5,000 and $20,000. A much smaller than average share of Gisborne Region youth (24%) earned more than $20,000 in 2006.
Youth in Hawke's Bay Region had a slightly different earnings pattern, and were more commonly reporting slightly higher incomes than the youth of Gisborne Region. Hawke's Bay Region youth had an average share of people earning $5,000 or less, but a slightly higher than average share of youth earning between $5,000 and $20,000. There was a slightly smaller than average share of youth in Hawke's Bay Region who earned more than $20,000 in 2006.
Charts 18 shows the annual median earnings from wages and salaries by age group compared with that of the national average. It can be seen that the median earnings for both Gisborne and Hawke's Bay Regions youth aged 15-24 years old, and indeed for all age groups in these regions, were below the national averages. National earnings (as measured by the LEED) data were quite heavily influenced by the higher incomes seen in Auckland and Wellington results. Many of the regions without major cities do tend to have lower than average incomes.
What is driving the pattern of earnings for youth in your region? What are the impacts for youth? Is this likely to have any impact on migration patterns? Is the pattern of earnings likely to change over the next few years?
[18] Note that the change between 2001 and 2006 shown here will differ from that shown in Table 1. In Table 6, the calculation excludes any people who did not define their labour force status.
[19] See "Leveraging Training and Skills Development in SMEs", 52nd Session, 9-10 June 2008, OECD, Paris.
[20] Source: Linked Employer-Employee Dataset (unpublished annual tables), Statistics New Zealand.
[21] Electricity, Gas and Water Supply experienced a large percentage growth between 2001 and 2006. However, it accounted for a very small proportion of the total employment.
[22] The proportion of the working-age population that is employed.
[23] Employment rates from the Household Labour Force Survey and Population Census differ. This is a result of the different scope and coverage of the two surveys. For more information, see the Data Dictionary.
[24] It is important to recognise that income can be influenced by other things than salaries and wages. For many people, rental or investment income can contribute a significant share of their income. It is likely that youth are likely to earn less from these other income sources than the rest of the population.
[25] Jobs for Youth – New Zealand, 2008, p54 and p59.
[26] The data is based on 15–24 years old who provided their income in the 2006 Population Census.