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New Zealand’s unemployment rate has climbed to 5.4 percent, its highest level since September 2015, according to new labour market figures released today.
The rate is up slightly from 5.3 percent in the September 2025 quarter, which was already a nine-year high.
Data from Stats NZ shows there were 165,000 unemployed people in the December 2025 quarter, up from 160,000 in the previous quarter.
The result was worse than forecast by economists and the Reserve Bank of New Zealand.
Highest unemployment in a decade
Stats NZ macroeconomic spokesperson Jason Attewell said the figures marked the highest unemployment rate in a decade.
“Today’s numbers are the highest since September 2015, when the unemployment rate was 5.7 percent,” Attewell said.
“Over the quarter, we saw higher levels of engagement in the labour market as both employment and unemployment increased.”
The underutilisation rate, which measures people who are unemployed, underemployed, or available for work but not actively seeking it, was unchanged at 13 percent.
There were 409,000 underutilised people in the December 2025 quarter, compared with 407,000 in the September quarter.
Earlier today, The Warehouse Group announced it would cut 270 head office roles as part of a major restructure, adding to concerns about ongoing softness in the labour market.
It comes as the inflation rate sits outside the Reserve Bank of New Zealand’s (RBNZ) target band of 1 to 3 percent – now at 3.1 percent.
CEO of and Principal Economist at Infometrics, Brad Olsen told the Franklin Times, “the rising cost of essentials is driving inflation and despite a lift in business activity, the employment sector is still struggling.
“A stream of end-of-year data points to a more upbeat economic outlook for 2026, at least on the surface,” he says.
“Manufacturing and services activity lifted toward the end of last year, which Olsen says is encouraging after a prolonged slowdown. Job advertisements have also risen slightly, although they remain low compared with historical levels.”
Despite that lift, Olsen says the job market remains extremely tough for many workers. Infometrics’ analysis of SEEK data shows that while job ads in November 2025 were still 22 per cent lower than in November 2019, the number of applications per job ad was 243 per cent higher.
“In practical terms, there are now about three-and-a-half times more people applying for every job than there were before the pandemic,” Olsen says, meaning competition for roles remains intense.
