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Developing a labour utilisation composite index for New Zealand

Jed Armstrong, Güneş Kamber, Özer Karagedikli

This Note presents a labour utilisation composite index (LUCI) for the New Zealand economy. We use principal component analysis to extract the underlying movements from a set of seventeen labour market variables. The LUCI fits the New Zealand business cycle well, and is particularly useful in situations when different labour market variables give contradictory signals, or when individual labour market variables have idiosyncratic movements.