New Zealand’s jobless rate rose to 5.6% in the June quarter, the highest it has been for more than a decade, with 166,500 people unemployed in April, May and June.
“The unemployment rate was 5.6% in the June 2026 quarter, compared with 5.4% in the March 2026 quarter,” Statistics NZ’s labour market spokesperson Abby Johnston said on Wednesday.
The seasonally adjusted 5.6% figure is the highest unemployment rate since March 2014. The 166,500 number of people who are unemployed is not seasonally adjusted.
The jobless rate in the March quarter was revised up from 5.3% to 5.4%, due to some of the data being seasonally adjusted and the inclusion of more up-to-date migration estimates.
“Around 8000 more people were experiencing long-term unemployment in the June 2026 quarter than in the same quarter in 2025,” Johnston said.
This latest unemployment figure was well above the projections made by the Reserve Bank (RBNZ) and by bank economists.
BNZ and Westpac picked 5.4%, ANZ and ASB anticipated an increase to 5.5% and Kiwibank projected 5.3%. Meanwhile, the Reserve Bank (RBNZ) projected the jobless rate would increase slightly, to 5.4%. In its May Monetary Policy Statement, the RBNZ projected the unemployment rate would “remain near this level until mid-2027”.
The people who would like to do more work
The increase in the unemployment figure comes as the data shows a rise in underutilisation to 13.8% from 12.9% – this is a broad measure of untapped labour market capacity and includes unemployed people, the potential labour force and people who are underemployed. To put more simply, it’s people who would like more work.
The last time the underutilisation rate was around this level was in the December 2013 quarter, when the rate was 14%.
In the June quarter, there were 440,000 underutilised people, increasing from 408,000 in the March quarter.
The rise in underutilisation includes an estimated 8000 unemployed people, bringing that total to 171,000 while 9000 people were underemployed – bringing the total of underemployed people to 154,000. Meanwhile, there were 14,000 people in the potential labour force category, bringing that total to 115,000.
Young people, by age group, experienced largest increase in underutilisation over the past year
Young people continue to struggle – with Stats NZ’s data showing that by age group, youth experienced the largest increase in underutilisation in the year to the June quarter.
For 15 to 24-year-olds, the underutilisation rate rose from 33.6% to 37.0% over the year. The number of underutilised people in this age group jumped 21,500 annually – with the largest increase in underutilisation coming from unemployment.
The underutilisation rate for people in the 25 to 34 age group also increased – going from 9.7% to 11.6% with the number of underutilised people in this group rising 11,900 over the year.
For the 25 to 34 age group, the main contributor to rising underutilisation came from underemployment, which was up 6600 annually.
In the June quarter, 25.8% of underutilised people were Māori with the Māori underutilisation rate sitting at 22.8%. This rate was up 3.2% over the year.
Young people who were not in employment, education or training (NEET) was 13.8% in the June quarter, down from 14.4% in the March quarter.
Employment and participation
The jobless rate in the North Island increased to 6.0% from 5.3% a year earlier. In the South Island, the unemployment rate was 3.7% in the June quarter.
When it came to the employment rate – this was at 66.7% in the June quarter, largely unchanged from the previous quarter. This shows the seasonably adjusted number of employed people was sitting at 2,905,000 people were employed compared to 2,892,000 in the March quarter.
The participation rate (labour force participation is the proportion of working-age people who are engaged in the labour market through employment or unemployment) was 70.7% in the June quarter, compared to 70.4% in the March quarter.
Annual wage inflation increased 2%. Average weekly earnings for full-time employees rose 3.0% to $1730 from $1679. This broader measure includes pay gains from job changes, promotions, and extra hours. Hourly pay rose 2.8% to $44.62 from $43.39.
New Zealand had low rates of unemployment in 2021 and 2022. However it saw a jump in December 2023, reaching 4.0% and then rising quite quickly to 5.1% by December 2024.
The unemployment rate hasn’t been below 5% since September 2024. The last time it dipped below 4% was in September 2023.
52 Comments
What's your bet on the Govt's talking points? Is this because of COVID spending, or the Orange Man?
TPG. The Previous Government.
Unemployment was 4% when Labour left government and now 5.6% after 2.5 years under National. I can't see how anyone can blame this on anything other than Nationals austerity budgets...
What austerity budget? Willis spends more than Robertson. The government industrial complex is doing very well thank you - though I do agree that prison massage has taken an austerity hit.
They borrow more due to unaffordable tax cuts and reduced tax revenue from sacking everyone.
and they are spending more. In what universe is the new spending record austerity?
Nats will twitter on about "thats why we are focused on growth"
While I am no supporter of Labour the Nats just continue to be a disappointment. Nicola is not a budget manager in the slightest and Luxon is not a strategic thinker. But John Key also added to the decline by signing UNDRIP, Finlayson with Foreshore and seabed legislation, Bolger with a lack of clarity around Waitangi Tribunal, the RMA etc etc - all the way back to Rob Muldoon and carless days, SMP's et al.
Dont quite know how we extract NZ from the created mess with the likely election outcome but TOP sure aint the answer
"TOP sure aint the answer" - I suspect they will be the Kingmaker though.
I don't mind the idea of TOP / Labour / Greens if they each keep their radical policies off the table. Individually I don't like any of them, but combined we could get the best of the 3.
NZ has increasingly less tax payers than tax consumers (the boomer retirement wave). Land taxes genius is its simplicity and unavoidability. Where does the tax come from if not property related, higher income and GST..? Chippy's Cap gains tax is totally avoidable - dont sell, just like his bach. Greens policy will lead to mass restructuring to get below the $10m of assets, or like California and the UK, will just see high net worth exit in droves.
TOP is the only party with a policy that works, immediately. Which is why properganderists hate it.
"Its not what you earn, it's what you spend"
Applies to central & local govts as well as individuals & families.
I am currently very pessimistic on the current state of affairs in NZ. For example several people have left the company I work for recently and it has been a real eye opener. They almost all have taken lower paying jobs, when they finally got a job, as they generally have mortgages and young families to support and need secure income.
My company will close within the next 12 months and the rest of us will be made redundant. This is a company that has operated in NZ for over 40 years. I know many others who work elsewhere in similar situations.
So when I see politicians and bank economists cherry pick manipulated pieces of data and statistics to tell me there are "green shoots" and "the economy has turned" I say BS because that's not what I am seeing in the real world, with my own eyes.
Sorry to hear that Bubbles. Speaking to my physio today and apparently "restructuring" is a word a lot of his clients are using about their job situation.
Restructuring has become the Briscoe's Sale - it never stops
And the Briscoe's lady with the upbeat voice does remind me of a lot of HR types...
Tammy (Briscoes lady) wears a wig for the ads, perhaps Luxon could redo his image the same way XD
5.6% off your prospect of getting a job, sale ends soon.
But like Briscoes, there's actually a bigger discount to come next quarter.
Slogan: National, you'll never get better (improve)
Winston, he won't live much longer ?
Has your company advised that they will close within a year? I have been expecting to be made redundant for the last ten years. No hope of that now as I am nearly 67. I have given six months notice and hoping a younger person can take my place and I can have a month or two of skills transfer. I'm not entirely confident I will be replaced. My fear was that my leaving could spark "restructuring" and negatively impact my colleagues but I don't want to work forever.
Has your company advised that they will close within a year?
Without getting too specific it is clear the end is near, hence people prioritizing job security leaving. An exact date however has not been given but the general consensus is ~12 months. We will see.
Sorry to hear Bubbles. Your concerns echo the increasing concerns of the wider kiwi hivemind. The reality can no longer be hidden by the political merchants of spin. No focus on singular datapoints or BS surveys can sway perceptions from the ugly truth.
Our emperors are caught with their pants down between fact and fiction. The only short term “fixes” in their toolkit will just bury us further into the hole. Continual fiscal mismanagement bundled with monetary mismanagement from the CB has more than guaranteed our arrival to this point. Their business model is the core failure, Trump was the accelerant. So they continue to gaslight us as the Titanic takes on water. And no one is more punishing with this gaslighting than Luxon.
Truth exposes the illusion. When reality can no longer hide the truth, the veil drops and the illusion is over. The kiwi hivemind has awoken. They’re watching the great unravelling of the established system’s failures in real time.
The positive? Perhaps this inches us closer to more open and honest discussions amongst our “leaders”
This deterioration in unemployment is the inevitable result of this Govt's engineered recession, brought about by massive public service cuts and the ensuing loss in consumer confidence as a result of these cuts. Please do us all a favour and vote these clowns out of office on November 7.
I don't think that has helped but I think the bigger influence is the property market crash putting the "wealth effect" into reverse. Relentless capital gains since the 90's have papered over the cracks of a very limited NZ economy.
Havent seen these Massive public service cuts you mention and not a supporter of the other clowns asking for my vote - so rock and a hard place really. I have money to invest but why would I invest in NZ - other than an emotional attachment to my country the reasons are limited and risks are high
Which "massive public service cuts" would they be?
They seem to have been pretty targeted, but for those of us who have to deal with Health NZ IT to get projects moving, they are very much evident. The kind of back office, out of sight cuts that steadily gunge up the whole works.
Time are indeed tough. Not unlike the 90s post 87 speculative debt overshoot. An alternative view is hopefully employees will value their job and good employers more than they have in the last couple of decades.
The real issue here is the stupid cost of shelter (rent and or mortgage) due to the stupid levels of debt fueled pricing. This effects every single person. That several parties are campaigning on reintroducing tax deductibility on housing debt is mad. It simply allows is the part of the population that can access debt to suppress their income tax. Money that is badly needed to fuel little ol NZ.
A few more points will be added as the RB pushes ahead with hikes, no doubt.
Unemployment up, inflation up, interest rates up, living costs up, wages static, house prices down.
After reading the figure I can see the. " green shoots" and yes, I can hear "the economy really starting to hum". This is true , because economists said in mid 2025 that by mid 2026 the NZ economy would be going gangbusters.and the only thing holding it back is not enough people to fill all the newly created jobs. Yeah right.
It will happen next year...
And this was before the RBNZ increased the OCR.
I still think we are going over 6%, I can't see these green shoots.
Well we have 77, sorry 78 now, vape shops immigration accredited employers so the green shoots are out there if you look for them.
https://www.immigration.govt.nz/work/requirements-for-work-visas/approv…
Maybe time to legalise the green shoots, that may create employment in Northland.
Would compliment one of the few sectors doing ok in NZ - Tourism
I thought this was sarcasm until I searched 'Vape' in the accredited employee list - lo and behold 78 accredited employers in this highly skilled space, with roles that NZ'ers cannot fill
Stagflation
This is bad news. I have a relative in their early fifties that cannot find a suitable job after two years. Fortunately his wife works so it's not too bad. I wonder how many have simply stopped looking and others who have decided to retire early. This will make the statistics look not as bad even though they are bad already.
Do any other readers have stories to tell?
And imagine what the unemployment rate would be had all the young people not moved to Aus.
I would also add to your story, that AI is increasingly used for hiring, therefore older workers are less likely to 1./ want to engage with that after a lifetime of dealing with real, actual people, and 2./ May not understand how to best navigate this.
The result I've seen locally at least is everyone is putting out feelers everywhere through anyone they can. Friends, family, associates, who may be able to throw a good word in for them picking up some work.
From the resi construction sector coal face - I’ve been in business 10 years, during the peak Covid years I had four full timers, 3 vans on the road, with a peak of 74 heat pumps in stock awaiting installation. Last night I loaded a solitary heat pump into the van and stared back at a barren workshop, the first time I’ve ever had zero stock, and to compound this, it is the coldest week of the year. The idea of taking on staff is now a pipe dream, the work load isn’t there. Things are extremely bleak, what is NZ without the hosing ponzi? We are finding out - it isn’t much.
Still lots of houses being built though, imagine when that dries up too, unemployment rate heading to 10%?
Yea no new housing in my area. Whatever housing there is they use foreign contractors from out of town. Local trades don’t even get asked to quote. This is the new face of the resi sector.
The only work I get these days, which I’m very grateful is Gen X and boomers wanting upgrades on their mini mansion holiday home.
The wealth divide has never been so apparent.
1991. 11% u employment. Not so long ago for us older folk. Brand new territory for some.
Are we reaping the consequences of decades of unproductive "investment" in residential property?
Time to pay the piper
The new unproductive "investments" like Bitcoin and Gold seem much worse!
I dunno, not too many people have had to move overseas because they got priced out of bitcoin.
They've moved overseas because Bitcoin didn't create any jobs. Wasn't so much a problem at peak ponzi.
Is the additional space capacity in the workforce likely to dissuade the RBNZ from another rates hike this year?
Scott Bessent says the war is over now so yeah why not...
About the only thing not going up is the amount ACC is paying physios who do the actual work of patching people up and getting them back to work. Just this week we gave been advised that an annual incremental increase is not happening until late next year at the earliest. Needless to say, that has gone down like a cup of cold sick across the industry.
Heaven forbid TOP get anywhere near the levers of power. They are as left or lefter than the Greens. Have suddenly removed from their website increasing the juvenile age to 25 for juvenile court and over 25 for adult court. Their land tax calculations are likely to be near pie in the sky. The economist who wrote it Geoff Simmons a previous TOP part leader, with possible input from Gareth Morgan, has not published on TOPs website how he arrived at the total land value for NZ. You will also get co-governance on steroids. They have done a good marketing campaign that has taken in many people.
We welcome your comments below. If you are not already registered, please register to comment
Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.