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There is bad news for workers as the unemployment rate rises to 6% - the highest in seven years and worse than most had anticipated.
The latest labour figures for the three months to June 2009 was outside the 5.5%-5.7% band expected by most analysts, and is a 1% increase on the unemployment rate recorded in the first three months of this year.
This is the largest quarterly increase in unemployment since the September 1988 quarter, Statistics New Zealand says.
Over the past year, New Zealand's unemployment rate has steadily risen by about 0.3% each quarter from 4% in June 2008.
The number of people unemployed now stands at 138,000 - a 20.6% increase on the last quarter and a 10-year high. Statistics New Zealand says the increase was largely led by a 15,000 rise in unemployed women.
The number of unemployed men also rose, with 8,000 more not in paid work.
Over the 12 months to June, the number of unemployed rose by 48,000.
In amongst this there has been a 0.3% increase in the working age population and a decline in number of people employed, driving unemployment up.
The rise comes the government and Reserve Bank talk of early signs that the New Zealand economy is showing "green shoots" of recovery.
However, as ASB Bank chief economist Nick Tuffley says, unemployment tends to lag behind other indicators.
"What we're going to see is even after the economy starts to recover, the unemployment rate is still going to lift a little bit because we still need to get back to creating enough jobs to absorb all the new people leaving school, leaving university and coming into the country," he says.
Tuffley says unemployment could hit 7% later on this year.
With more unemployment, household spending declines, further impacting the rate of recovery of New Zealand's economy.
Similarly, the downturn suppresses wage growth as employers seek to trim costs and remain viable.
Data released on Tuesday showed that salary and wage rates increased just 2.8% for the year to June - the lowest annual increase since the year to June 2005.
However, stilted wage growth has also helped preserve jobs.
"What we've seen is a lot more flexibility with wage arrangements, a lot more wage freezes coming in to conserve jobs. So, that's probably helping take a bit of the edge off unemployment," says Tuffley.
During the June quarter, actual hours worked per week decreased by 1,367,000, or 1.9%.
The strengthening New Zealand dollar, which has risen over 32% in the last six months and now sits at around 67 US cents, will also help take the price pressure of some goods, such as oil, whiteware and travel for New Zealand consumers.
Though it is cold comfort for those who have lost their jobs, New Zealand is faring better than some other countries with employment. In May, the United States unemployment rate was 9.4% and Australia's unemployment rate was 5.7%.
