Auckland, Wellington see highest unemployment rates in over a decade | Stuff.co.nz

Added: 2026-05-13

[00:00:00]The unemployment rate has dipped slightly to 5.3% for the first quarter of this year.

[00:00:05]That's down from 5.4.

[00:00:08]But a breakdown of the data reveals certain regions are struggling.

[00:00:12]Auckland's unemployment rate climbed from 6.4 to 6.6% the highest there since 2014. Wellington jumped from 5.8 to 6.3% while the Bay of Plenty is grappling with the highest rate 7.1%. Now that's up from 5.7.

[00:00:30]The job figures are retrospective and don't reflect the full economic effects of the Middle East war that started at the beginning of March. Today the Reserve Bank governor warned we are now likely to see a somewhat slower recovery affecting job growth and debt servicing.

[00:00:47]And there was more disheartening data out today from MYOB showing business owners are increasingly dissatisfied with the government's performance.

[00:00:56]Here's political correspondent Zane Small.

[00:00:59]Recycle Boutique in Central Auckland sells used clothes on behalf of shoppers and takes a cut.

[00:01:08]And floor assistant Peter has noticed a recent rise in customers trying to make some extra money. Slight increase of people coming in um selling in clothes just because they've heard that you know we sell on behalf and they get a bit of the cash which is good. It's perhaps indicative of the economic slowdown.

[00:01:25]Official figures out today show the unemployment rate is still relatively high at 5.3% for the March quarter but it is down slightly from the previous 5.4. That is good to see and does show you that the economy was strengthening and showing some real green shoots ahead of events in the Middle East occurring.

[00:01:45]The Middle East conflict began at the beginning of March.

[00:01:49]And so as Kiwibank economist Alexandra Tuke points out the data doesn't show the full economic effects of the subsequent rise in fuel prices. Labor market information lags behind the rest of the economy so it's really giving us an idea of how businesses were thinking and feeling 6 to 9 months ago. So I guess it shows that there was some optimism in the economy before this war hit.

[00:02:15]That's right.

[00:02:16]>> But a breakdown of the data reveals that certain regions are struggling more than others including here in Auckland. The city's unemployment rate increased from 6.4% to 6.6% the highest since 2014. And it's also evident that young people are increasingly unable to find work. It goes to how businesses aren't really creating new jobs at the same rate as the labor force is growing and that's really worrying. The Reserve Bank's financial stability report today cited the Middle East war and warned that recent events suggest a slower recovery is now more likely. This could affect job opportunities and lead to renewed debt servicing stress. And as the economic environment deteriorates businesses are expressing frustration with the government. MYOB's nationwide survey of over 1,000 businesses shows that support for national is still strongest but has slipped six points since 2023 to 37% while labor has gained five points to 20%. And New Zealand First has seen the biggest jump nine points to 11% now equal with ACT which has dropped seven points. As we know the recovery has been slower than expected but also now businesses are facing a myriad of costs. Overheads are up again this year insurance is up energy costs are up and that all kind of takes a toll on how they're feeling. The finance minister is taking it on the chin. As a government we can't control the decisions of the US and Iran. What we can do is respond sensibly. That's why we've taken extra steps to extend our fuel reserves. But it's the high price of fuel that's hurting small businesses now facing fewer customers or in the case of Recycle Boutique more customers trying to make an extra buck.

[00:04:07]Okay Kyota Zane so how might today's unemployment figures affect the future decision making of the Reserve Bank?

[00:04:13]Well the data today included a bit of information that the Reserve Bank might see as positive but that the average worker will probably see as negative and that is wage inflation. It was at 2% in the March quarter which is lower than price inflation at 3.1% which suggests that workers haven't been getting big pay rises. And that's obviously not great for the average worker trying to struggle through this cost of living crisis but it means that there is less inflationary pressure in the economy and Alexandra Tuke from Kiwibank I spoke to in my story she explained to me that it may play a part in convincing the Reserve Bank to keep the official cash rate on hold later this month but of course we won't know for sure until the 27th.