“Calls for quick removal of monetary stimulus based on the HLFS job numbers released today are definitely way off the mark”, said BERL Chief Economist Dr Ganesh Nana.

“The rapid exchange rate response to today’s statistics are also of concern. With the Kiwi$ now back above 80 against the Aussie$ the incipient recovery in certain areas of manufacturing that we were beginning to see is again in jeopardy”.

For those with a very short time horizon, the latest job numbers do make exciting reading. But for those with a slightly longer time perspective the jobs and the jobless numbers continue to show an economy requiring a wise and steady hand.

Admittedly, compared to December 2009 the labour market is looking rosier. But, compared to this time last year there remains much lost ground to catch up.

Dr Nana is critical of the focus on seasonally adjusted figures in many commentaries, where the real story lies in the actual counts of real people. The HLFS show the number in jobs in March still down on that of March last year, and an unemployment rate now of 6.6% compared to 5.6% in March last year.

“This means that there were, in terms of real people, 25,000 more officially unemployed than a year ago. In addition, jobless numbers outside of those officially unemployed grew by a further 14,000 over the same period,” commented Dr Nana.

While the seasonal adjustment procedure is a perfectly legitimate tool to enable comparisons of short-term movements, analysis of labour market movements should not lose sight of the true longer-term trends and their effects on real people.

“And in terms of policy settings, one hopes the real situation in the labour market is weighed more soberly, than a somewhat cursory look at a few headline numbers. In particular, imminent interest rate decisions should not be swayed by the seemingly gung-ho analysis from some commentators intent on talking up interest rates. These numbers provide no justification to take the foot off the gas pedal yet,” concluded Dr Nana.