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New Zealand Jobless Rate Hits 5.4%, Highest Level in Over a Decade

New Zealand's unemployment rate has risen to 5.4% for the December 2025 quarter, marking the highest level since September 2015. While unemployment increased, the labour force participation rate also grew, with a notable rise in women entering the workforce, particularly in managerial and professional roles. Concurrently, data shows household living costs increased by 2.2% over the year, with inflation pressures varying significantly across different household groups. The statistics highlight a complex labour market where more people are seeking work even as employment numbers also rise.

Key Points: NZ Unemployment Rises to 5.4%, Highest Since 2015

  • Unemployment hits 5.4%, highest since 2015
  • Labour force participation rises to 70.5%
  • Female employment grows in managerial roles
  • Household living costs rise 2.2% annually
3 min read

New Zealand unemployment hits 5.4 per cent, highest in over decade

New Zealand's unemployment rate climbs to 5.4% in Dec 2025 quarter, the highest in over a decade, as living costs and wage data are also released.

"We saw higher levels of engagement in the labour market as both employment and unemployment increased - Jason Attewell"

Wellington, Feb 4

New Zealand's unemployment rate rose to 5.4 per cent in the December 2025 quarter, the highest since the September 2015 quarter when it was 5.7 per cent, Stats NZ reported Wednesday.

The unemployment rate of 5.4 per cent was up from 5.3 per cent in the previous quarter, said the statistics department, Xinhua News Agency reported.

The number of unemployed people rose by 5,000 to 165,000 over the quarter, while both employment and participation in the labour market increased, Stats NZ said.

The labour force participation rate rose to 70.5 per cent, with 19,000 more people active in the job market over the quarter, it said.

"We saw higher levels of engagement in the labour market as both employment and unemployment increased," said Stats NZ macroeconomic spokesperson Jason Attewell.

About 20,000 more women joined the labour force, with 16,000 gaining employment compared with the previous quarter, statistics showed.

Female employment rose particularly in managerial and professional roles, while clerical and administrative positions declined, Stats NZ said.

Overall, the employment rate stood at 66.7 per cent, the underutilization rate at 13 per cent, annual wage inflation at 2 per cent, and average hourly earnings at 43.99 New Zealand dollars (26.59 U.S. dollars) in the December 2025 quarter, it said.

On February 2, Stats NZ said the average New Zealand household's living costs rose 2.2 per cent in the year to December 2025.

Household living costs price indexes (HLPIs), which measured the increase and how inflation affects New Zealand households, have continued to moderate since peaking at 8.2 per cent in 2022, returning to levels last seen in June 2021, said the statistics department.

The consumer price index (CPI), a broader gauge of inflation, rose 3.1 per cent over the same period, statistics showed.

"Interest payments fell 17.3 per cent for the average household over the past year, while the cost of building a new home increased 1.2 per cent over the same period," Stats NZ prices and deflators spokesperson Nicola Growden said.

HLPIs include interest payments, such as mortgage, credit cards, and other interest, while the CPI includes the cost of building a new home.

Super annuitant households experienced the highest inflation rate at 3.8 per cent, driven by higher local authority rates, electricity prices, and health insurance, Stats NZ said.

By contrast, the highest-spending households recorded the lowest inflation rate at 0.8 per cent, reflecting an 18.6 per cent drop in mortgage interest payments, it said.

Rent rose 1.9 per cent over the year and remained the main contributor to higher living costs for beneficiary and Maori households, statistics showed.

- IANS

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Reader Comments

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Rohit P
Unemployment at 5.4% is considered high for them? 😅 In many Indian states, we'd celebrate that as a success! But seriously, it shows how interconnected the world is. When big economies sneeze, others catch a cold. The data on living costs rising faster for retirees is worrying—same story everywhere.
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David E
The article mentions a 2% annual wage inflation with average hourly earnings at ~NZ$44. That's roughly ₹2,400 per hour! Even with their higher cost of living, that's a perspective check on the wage gap between developed and developing nations. The struggle with inflation, however, is universal.
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Ananya R
While the headline is about unemployment, the real story is in the details—rising participation, more women working, but clerical jobs declining. This shift towards professional roles is crucial. India needs to focus on similar skilling to move our workforce up the value chain, not just create more low-wage jobs.
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Suresh O
The fact that highest-spending households saw the lowest inflation (0.8%) due to falling mortgage interest, while costs hit retirees hardest, shows a clear inequality. Policy must protect the vulnerable. In India, we see similar trends where essential commodity inflation hurts the poor more. Governments worldwide need to act.
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Michael C
A respectful criticism of the article: it's very data-heavy from Stats NZ but lacks analysis on *why* this is happening. Is it global headwinds, domestic policy, or sector-specific issues? As an investor with interests in the Asia-Pacific, context matters more than just the numbers.

We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.

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