New Zealand Faces Record Job Losses Amid Persistent Labour Market Challenges

One year on, New Zealand has lost 27,850 jobs, with young people bearing the brunt of the weak labour market, according to the latest data from Stats NZ. The numbers paint a grim picture of the country’s employment landscape, with key sectors such as construction and manufacturing shedding thousands of roles, while youth unemployment continues to rise.

The data reveals that the number of filled jobs in the country increased by just 0.1 percent month-on-month but fell by 1.2 percent year-on-year. This decline is particularly pronounced in sectors like construction, which lost 12,169 jobs—6 percent of its workforce—while manufacturing and professional services also saw significant job losses. Conversely, education and training, as well as primary industries, added a few positions, offering a glimmer of hope in a broadly negative trend.

Young people are particularly affected, with those aged 15 to 19 experiencing a 10 percent drop in employment, and those aged 20 to 24 and 25 to 29 seeing declines of 3.5 percent and 3.9 percent, respectively. Hugh Hawkins, a 23-year-old graduate struggling to find work, described the situation as “a widespread problem,” with many young professionals relying on casual work and benefits to survive.

“Chatting to my coworkers they're virtually all in the same situation,” Hawkins said. “They have to rely on the benefit to pay rent with casual work on the side. People from different walks of life, most young and very qualified… if I'm struggling it must mean terrible things for what other people are also going through.”

Economists have warned that the data may be even more concerning than it appears, as some businesses may have added roles during the year that are not reflected in the statistics. The revisions in recent months have all been downward, indicating a continued trend of job losses, with the effects of the pandemic still lingering in the economy.

ASB senior economist Mark Smith noted that young people are being most affected by the current state of the labour market. “The hope is that some will go into training if it's available but it's not available for everyone,” he said. “The labour market tends to be the last thing to move.”

BNZ chief economist Mike Jones expressed cautious optimism, stating that the “mid-year activity air pocket” would likely pass, with the recovery still on track. However, he warned that the recent weakness would delay the expected recovery in the labour market, with unemployment potentially peaking at 5.4 percent in the final quarter of the year.

Green Party spokesperson Ricardo Menendez-March called on the government to take action and create jobs that would help build a better future. He highlighted the Green Job Guarantee as a potential solution, which would create 40,000 jobs in infrastructure, nature restoration, and state housing.

As the country grapples with the ongoing challenges of the post-pandemic economy, the need for targeted policy interventions to support young people and boost employment in key sectors has never been more urgent.