Young people experienced the largest increase in underutilisation in the year to June 2026, according to the latest labour market figures from Statistics New Zealand.
The underutilisation rate measures the untapped capacity in the labour market, or people who would like to work more. It includes unemployed people, the potential labour force and underemployed people.
Stats NZ sees the metric as just as important as the unemployment rate and found young people were hit particularly hard by a jump in the underutilisation rate, which reached 13.8% in the June 2026 quarter.
The underutilisation rate for 15 to 24-year-olds rose to 37.0% from 33.6% in the 12 months to June, with the number of underutilised people in this age group increased by 21,600 annually to 180,200.
The largest increase in underutilisation for this age group came from unemployment, up 12,200 in the year to June.
Breaking down the group further shows the underutilisation rate for 15 to 19-year-olds rose to 53.8% in the June 2026 quarter from 50.5% a year earlier. The unemployment rate for this age group also increased to 25.3% in the June 2026 quarter, from 23.0% in the previous year.
There are currently 43,400 unemployed people in the 15 to 19-year-old age group, up 6,300 from June 2025.
For 20 to 24-year-olds, the underutilisation rate was 24.4% in the June 2026 quarter, rising from 21.4% a year ago. The unemployment rate for 20 to 24-year-olds also jumped from 9.8% in the June 2025 quarter to 12.0% in the June 2026 quarter.
There are currently 31,600 unemployed people in the 20 to 24-year-old age group, up 5,900 from June 2025.
Fewer NEETs
According to Stats NZ, the NEET rate, the rate of young people aged 15-24 not in employment, education, or training, fell to 13.8%, down from 14.4% in the March quarter.
The NEET rate includes unemployed people who are part of the labour force, actively looking for work, as well as unemployed people who are not in the labour force, not working and not looking for work.
Kiwibank economists Alexandra Turcu and Elliott Lowe say the latest labour market statistics showed young people had been especially affected, but it was “good news” that the NEET rate had lowered.
“We need that. But that movement is largely due to movement into education. Exactly what we’d expect when young people can’t find a job with their current qualification levels. They look to upskill,” the pair say.
Stats NZ says for 25 to 34-year-olds, the main contributor to rising underutilisation was underemployment, up 6,600 annually.
For 25 to 29-year-olds, the underutilisation rate was 13.3% in the June 2026 quarter, up from 11.4% a year ago. The unemployment rate for 25 to 29-year-olds also rose from 5.1% in the June 2025 quarter to 6.5% in the June 2026 quarter.
There are currently 19,100 unemployed people in the 25 to 29-year-old age group, a 4,000 increase from June 2025.
Looking at the 30 to 34-year-olds, the underutilisation rate rose from 8.2% to 10.1% in the 12 months to June, while the unemployment rate for this age group also increased to 4.1% in the June 2026 quarter, from 3.6% in the previous year.
There are currently 14,200 unemployed people in the 30 to 34-year-old age group, up 1,600 from June 2025.
New Zealand’s unemployment rate came in at 5.6% in the June 2026 quarter. The jobless rate last reached 5.6% during the March 2014 quarter – over 12 years ago.
Stats NZ labour market spokesperson Abby Johnston said around 8,000 more people were experiencing long-term unemployment in the June 2026 quarter than in the same quarter in 2025.
There are now 2,905,000 people employed in a workforce of 3,076,000 across NZ. There is a total working-age population of 4,353,000 and the employment rate is currently at 66.7%, down from 68.3% in June 2025.
It's a different story for boomers
BNZ's head of research Stephen Toplis has pointed out that the age group with the strongest job growth in the latest labour market data are those over the age of 65.
“The winners here, by a significant margin, are those aged over 65 who accounted for 60% of the annual growth in total employment,” he says.
“In part this simply reflects demographics, i.e there are an increasing number of people who are aged over 65 in the economy. But, equally, the participation rate of those in the demographic is rising rapidly as more older folk decide to work. Some because they have to, but an increasing number, we suspect, because they simply want to.”
The underutilisation rate for those 65+ was at 8.3% in the June 2026 quarter, the same rate it was a year ago. The unemployment rate for this age group was at 1.4% in the June 2026 quarter, a decrease from 1.6% in the previous year.
There are currently 3,500 unemployed people in the 65+ age group, the same number that was reported in June 2025.
6 Comments
I imagine it's not actually job growth for the Baby Boomers it's just that they are hanging onto their jobs for longer. It would appear, at the expense of the younger age groups. 50-54 group are losing jobs and finding it harder to get another while the 65+ group are hanging onto theirs longer than this age group did in the past. I doubt there are 65+ people applying for and getting more jobs.
Good grief....talk about gilding the lily.
"The underutilisation rate for those 65+ was at 8.3% in the June 2026 quarter, the same rate it was a year ago. The unemployment rate for this age group was at 1.4% in the June 2026 quarter, a decrease from 1.6% in the previous year."
So those entitled to Super and Kiwisaver balances have an underutilisation rate of over 8%....and this is a positive?!!!!...FFS
This statement from a bank economist about more 65 year olds working: "Some because they have to, but an increasing number, we suspect, because they simply want to".
What a load of bollocks and ignorance of the current economic hardships people are going through.
They're all forced to stay in jobs due to their post retirement fixed incomes (THANKS a lot Luxon!) not keeping up with the cost of living increases!
There is an arguable case for increasing superannuation payments.
There are still plenty of lawyers and accountants in this age bracket simply working as they enjoy it, and don't want to give up raking in the doh. Many can dial their work days back to 2-3 days a week and still cream the income, super and kiwisaver can be for later on if a private surgery is needed. GP's are another I see, with many doing 2 days per week in clinic, which is another reason why people have to wait longer if they want to see one specific doctor. 'Their' GP isn't so available these days.
Lies, damn lies and statistics come to mind .....
We have all gone through the education system and then entered the labour force. One way or another we have all negotiated that transition and i would suggest that looking back over history, it has always been a difficult process to one degree or another. Because it also encompasses the transition from youth to autonomous adulthood.
I note that formal labour force statistical tracking only commenced in 1986. So when considering employment/unemployment, it is against a very short tracking period.
The highest official unemployment rate was 11.2% in third quarter 1991, following the 1987 sharemarkets crash and Rogernomics reforms. But unofficial estimates place joblessness at north of 20% during the 1930s depression (probably a lower reading due to the government works schemes such as planting the Kaiangaroa forest on the Central, volcanic plateau. And interestingly by planting exotic pinus radiata, determining the future trajectory of NZ forestry industry (after depletion of endemic species) with a fast growth, relatively low value timber species that didn't really achieve meaningful value until preservative treatments became available - based on copper, chrome, and arsenic. Whether that was a wise strategic choice by government at the time is debatable).
The point is that NZ has suffered periods of high joblessness that have shaped attitudes to work amongst the population. Many boomers, I suggest were shaped by both parental experience of the depression and horrors and privations of WW2. I am.
Where does that leave us in 2026? Arguably in a bad predicament because this time around, employment decline is coinciding with the reality that continuous growth is unattainable. That degrowth is inevitable. And degrowth strikes at the very heart of lifestyle expectations. First showing in the decline in property values, undermining the notion that property values will always increase. Then in cost and vulnerability of fossil fuel supply. Then upwards pressure on manufacturing and processing costs, unmatched by rising incomes and employment opportunities.
A structural change is developing, in my opinion, where every Kiwi will need to cut one's coat to suit the cloth. And government can lead by supporting structural change in as equitable manner as means allow.
Structural change I would like to see include:
Instigating a forced 15% debt write-off by banks.
Reimpose non deductibility of interest on investment housing.
Means testing of national superannuation (might affect me).
And reimpose death duties and stamp duty on property transfers.
As just one biological species occupying the planet, we are delusional to think we are immune to the negative impacts of population dynamics, be that economic collapse and reconfiguration or population decline to a new, sustainable level. That will be painful.
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