As the global recession worsens, businesses will shed staff or close down altogether and unemployment is expected to double. It’s not going to be a happy year.
Not only will there be fewer jobs available, but there may also be more people seeking work.
Kiwis wanting to do their OE may postpone their plans if they are less certain of getting work overseas, and some already on their OE may return home earlier if they can’t get work.
Falling interest rates on bank deposits may mean that some retirees will be looking for part time work to top up their incomes.
Some occupations will be more at risk than others as the recession bites in. People in property related occupations such as real estate agents, mortgage brokers, valuers and builders and other building related trades were among the first to be affected.
Retailers have clearly suffered too with lower sales over the holiday period. Service industries such as recruitment and marketing are feeling the pinch and it seems that within a few months we will see widespread effects throughout most sectors of the economy.
Putting this in perspective though, we have come from a time when we have had extremely low levels of unemployment and many employers have complained of being unable to recruit staff.
So while the unemployment rate may double, it will not be that far off a more typical level. We are certainly not expecting unemployment on the scale of the Great Depression.
That said, caution should still prevail. Now is the time to be careful about how much debt you take on.
Statistics show that the amount of money owing on credit cards has fallen considerably, and despite lower interest rates, first home buyers are not rushing in to take up mortgages for fear that their incomes may not be sustainable.
Those people in their fifties who have left their retirement saving to the last few years of their working life face a significant risk. Losing your job in your fifties can be financially devastating as it can result in a long period of unemployment during which it becomes impossible to save for retirement.
If you find yourself out of a job and facing financial difficulties, your starting point should be to contact people or companies to whom you owe money and explain your situation.
Lenders will often help you through bad times rather than face the expense of trying to recover money through a debt collector or a mortgagee sale. Taking a mortgage holiday for a few weeks is one way of making things easier.
If you are renting, your landlord may be willing to allow you to pay less in rent for a while on the understanding that you will catch up once you are back working. For your landlord, this is better than having an empty property for a few weeks and having to find a new tenant.
Losing your job doesn’t need to be all bad news. For some, it is an opportunity to establish a new career or start a new business. The internet is a great source of ideas for a new business or career opportunities.
All that is required is a positive attitude and a willingness to try something new.
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