Job Market Lifts, But Falling Hours And Stagnant Wages Put Pressure On Kiwis

With employment rising but hours and wages slipping, New Zealand’s labour market enters the Christmas period with mixed signals. Traditionally, Kiwis see stronger pay packets and an increase in hours in the lead-up to summer, however 2025 may buck the trend. This year, casual hours have plummeted and even 18-24 yr olds who have been leading in employment growth and wages and hours worked previously have seen their hours decline, a sign that the solution is more complicated than a simple pay increase

New Zealand’s job market is showing signs of momentum heading into summer, but the gains are uneven and they’re not translating into better pay or more hours worked. It’s tempting to say Kiwis just need a pay rise, but paying people more is not the solution on its own – the reality is more complicated than a headline wage increase.

A different festive season

Despite traditionally seeing a ramp-up in hiring and wages before Christmas, this year is shaping up differently. Employment Hero’s October Jobs Report, built from real-time payroll data across over 350,000 businesses and 2.5 million employees worldwide, shows New Zealand employment rising 4.5% year-on-year, 6.0% quarter-on-quarter, and 2.8% month-on-month; but average hours worked fell 0.1% MoM and 0.6% YoY, while median wages slipped 0.1% MoM and declined 1.4% QoQ, signalling pressure on both household earnings and business output.

Productivity under pressure

“Jobs are returning with force after a slower few months,” said Ben Thompson, Co-founder and CEO of Employment Hero. “Businesses are hiring again, but they’re still cautious about how much work they’re giving people. A spike in hires alongside a dip in hours suggests many Kiwis are patching together multiple jobs just to stay afloat. Plus, this dip in hours is across all employment types, including full-time, which is a red flag for output and job security. More people are working, but we’re not necessarily getting more done.”

He adds that “Employers are still doing what they can to stay competitive amid inflationary pressures, but layers of legislation and increasing cost of compliance mean it’s never been a more expensive or confusing time to be an employer. Businesses aren’t pulling back, but they are feeling restricted and doing what they can to keep their employees and their business above water.”

Key insights - Employment Growth

• Employment up 4.5% YoY, 6.0% QoQ, 2.8% MoM.
• South Island leads with 8.5% YoY, outpacing North Island’s 1.6% YoY.
• Otago surges 32.5% YoY, while Hawke’s Bay jumps 12.7% MoM.
• Hiring is heavily weighted toward casual roles (+12.6% YoY; +4.48% MoM).

Wages slipping despite hiring gains

Median wages fell 0.1% MoM, 1.4% QoQ and now sit at $35.10/hour. This stagnation - especially heading into the Christmas period when wages normally tick up - suggests ongoing cost pressures for employers.

Additional highlights:

• Casual, full-time and part-time wages were all stagnated MoM.
• South Island: highest YoY wage growth (4.1%), but also a -0.6% MoM decline.
• Canterbury leads in YoY wage growth (5.4% YoY) but saw the sharpest MoM drop (-2.3% MoM).
• Retail, Hospitality & Tourism is the only sector showing meaningful wage growth (+4.1% YoY).
• Education & Training wages fell (-1.9% YoY, -0.9% MoM).

The bottom 10 job titles by wage remain dominated by retail, hospitality and customer-facing roles - many below $27 per hour.

Hours worked continue to fall - a big red flag

Average hours worked slipped 0.1% MoM, 0.6% YoY and 0.6% QoQ, despite rising employment. This mirrors the Australian trend and suggests pressure on productivity and job security.

Key details:

• North Island hours down -0.7% YoY, -0.1% MoM.
• South Island stagnating with no movement.
• Bay of Plenty shows the biggest YoY decline (-0.2%).
• Taranaki up 3.0% YoY - the only region with meaningful growth.
• Casual hours plummet: -8.9% YoY, -5.2% MoM.
• Part-timers improved (+3.5% YoY).
• Education & Training sees the highest YoY rise in hours (+13.6%).
• Healthcare & Community Services hit hardest (-2.0% MoM).
• Those aged 14–17 are being hired, but their hours dropped -2.1% YoY.

Uneven growth

Similar to Australia, Construction & Trade Services continues to power NZ’s job growth, rising 13.1% YoY. Meanwhile, the Science & Tech sector posted the strongest monthly increase of all industries at +4.8% MoM, fuelled by increasing demand for AI-related skills.

Younger workers are also driving momentum, particularly 18–24 year olds, who recorded 12.4% YoY growth. However, female employment declined -0.6% YoY.

For more information on the Employment Hero Jobs Report, visit the real-time dashboard: https://employmenthero.com/insights/jobs-report/

About Employment Hero

Employment Hero is the global authority on employment, offering a world-leading Employment Operating System (eOS) that simplifies and optimises every stage of the employment process. Its award-winning platform combines HR, payroll, recruitment, and employee engagement tools with the groundbreaking employment superapp, EH Work, which integrates career management and financial wellbeing. Serving over 350,000 businesses and managing more than 2.5 million employees worldwide, Employment Hero reduces administrative burdens by up to 80%, enabling organisations to focus on their goals and create more productive, engaged teams. By revolutionising the employment marketplace, Employment Hero is making employment easier, more valuable, and rewarding for everyone.

About the Employment Hero Jobs Report

The Employment Hero Jobs Report is built from the real-time employment data of the 350,000 businesses and 2.5 million employees that are served by the employment platform. The figures are broken down by state, industry, age and employment type.

For more information, visit employmenthero.com

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