Article review - CDANZ • Career Development Association of New

CDANZ Article Review
Author(s) Title Date Publication Wellington Branch
25th August 2014
Volume Issue Pages Ordering Information Mare, D.C. & Fabling, R.
The Incidence and Persistence of
Cyclical Job Loss in New Zealand
August 2013
Motu Working Paper, Motu Economic
and Public Policy Research Discussion
paper No 7745, IZA, Berlin
13
8
51
Available through the Ministry of
Education Library
Reviewer: Lis Whyte
Overview: The paper looks at changes in employment within NZ between 2000 and 2011, with focus on
the impact from 2008 of the Global Financial Crisis (‘GFC’) on employment trends in New
Zealand. It is based on data from the Integrated Data Infrastructure prototype managed by
Statistics New Zealand.
This paper is one of the documents influencing the work-related component of the Our Futures
project recently released by The Royal Society.
Key ideas: The GFC has had the largest impact with a longer term effect on vulnerable workers –15-24
year olds and unskilled and temporary workers. ‘As in previous downturns, the incidence of
cyclical job loss and unemployment has fallen disproportionately on young and unskilled
workers’.
Where the GFC resulted in employees leaving their existing employment, it took longer to find
new employment than prior to the GFC. ‘Workers who left or lost jobs spent longer out of
work after the GFC and settled for lower earnings growth when they did find a job. Both of
these effects had partly but not fully abated within 3 years of the onset of the GFC’.
Content: The target audience would seem to be other academics, and the writing style and use of
specialist terms (e.g. ‘job separation’ referring to workers leaving a job), make it hard reading at
times for the lay-person.
However, the paper does have some interesting statistics showing growth or decline in
employment by groups of workers (by age, gender, industry, region and earnings), and which
identifies those groups that suffered most from the GFC.
The GFC resulted in reduced ‘liquidity’ in the job market (i.e. existing workers were more
reluctant to change jobs), meaning that new entrants found it harder to find work and were at
greater risk of becoming long term unemployed.
The negative shock of the GFC will result in structural changes to employment with on-going
higher levels of unemployment for both younger workers and the unskilled, though also greater
skill shortages or mismatch between jobs advertised and worker capability and location. The
implication is that we need to be prepared to train unemployed youth and actively support them
to gain work related skills.
The authors work for Motu Economic and Public Policy Research, a not for profit research
organisation which aims to promote discussion and inform public policy on issues relevant to
New Zealand. They undertook the research while on secondment to Statistics NZ.
Activities: Useful when thinking about social justice, public policy, context for political agendas, educating
clients about world of work changes which could affect them and the resilience of employment
in some industries or regions over periods of stress.
Final The article is interesting but not an easy read. There is nothing surprising but it puts numbers
Comments: around employment trends.
It is relevant for career counsellors who are interested in economic events and cycles which
impact on our clients’ ability to find work and training.

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