Unemployment improvement in sight—P.M.

Press, 17 June 1983, Page 3

Unemployment improvement in sight—P.M.

PA Wellington New Zealand’s improving external balance of payments would allow unemployment levels to drop over the next 12 months, said the Prime Minister, Mr Muldoon, yesterday. Mr Muldoon told a postcaucus press conference that the solution to unemployment was to have more activity in the economy, taking unemployed people into jobs in the private sector.

It was no solution to have more and better temporary job schemes, he said.

The Government would be able to stimulate the economy because of improvements in external balances which were coming through now. The improvements had been “almost spectacular.”

“This will enable us to move gradually to take up some of the slack in the private sector,” he said.

When asked if he thought there would be an improvement in unemployment over the next few months, Mr Muldoon said he “would be looking ahead 12 months rather than the next few months. There is a considerable time lag in all of this.”

There would be seasonal rises in unemployment over the next few months, he said.

He would not predict when unemployment would start to fail, saying it would depend on how long it took Government policies to bite. He said that, in the long term, the freeze would have helped diminish unemployment because it was assisting the Government to get the economy back on an even keel. “If we had had the $2O a week wage increase instead of the wage freeze I have not the slightest doubt that more would have been lost,” Mr Muldoon said.