{"id":559246,"date":"2026-08-05T00:54:09","date_gmt":"2026-08-05T00:54:09","guid":{"rendered":"https:\/\/www.newsbeep.com\/nz\/559246\/"},"modified":"2026-08-05T00:54:09","modified_gmt":"2026-08-05T00:54:09","slug":"unemployment-rate-hits-5-6-worse-than-expectations","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/nz\/559246\/","title":{"rendered":"Unemployment rate hits 5.6% – worse than expectations"},"content":{"rendered":"

\u201cThe second quarter of this year was a tough one,\u201d Finance Minister Nicola Willis said, in response to the data.<\/p>\n

\"WELLINGTON,WELLINGTON, NEW ZEALAND – AUGUST 03: Finance Minister Nicola Willis speaking during the post-Cabinet press conference, the Beehive theatrette, Parliamenti, Wellington, New Zealand, August 03, 2026: Herald photograph by Mark Mitchell <\/p>\n

\u201cApril, May and June were difficult months for many employers. They faced real uncertainty and rising costs, and a lot of them made the hard call to hold off on hiring or expanding.\u201d<\/p>\n

\u201cFor the New Zealanders who\u2019ve been out there looking for work in that environment, we know it\u2019s been hard going.\u201d<\/p>\n

Willis outlined Government policy moves that were aimed at boosting economic growth but warned that \u201cnone of this is about quick fixes\u201d.<\/p>\n

Of the 166,500 people who were unemployed in the June 2026 quarter (not seasonally adjusted), 19% had been unemployed for more than a year. Being unemployed for over a year is one measure of long-term unemployment.<\/p>\n

\u201cAround 8000 more people were experiencing long-term unemployment in the June 2026 quarter than in the same quarter in 2025,\u201d Johnston said.<\/p>\n

On a regional basis, the unemployment rate was highest in Northland at 8.8%, up from 5.1%, followed by Auckland at 6.5%. The areas with the lowest unemployment rate were Otago and Canterbury at 3.6%.<\/p>\n

\u201cThe seasonally adjusted underutilisation rate was 13.8% in the June 2026 quarter, up from 12.9% in the March 2026 quarter,\u201d Johnston said.<\/p>\n

Underutilisation is a broader measure of untapped labour market capacity than unemployment. <\/p>\n

It includes unemployed people, the potential labour force, and people who are underemployed.<\/p>\n

The underutilisation rate reached its highest level since December 2013, when it reached 14%.<\/p>\n

Meanwhile, the youth unemployment rate for those aged 15-19 grew to 25.3%, more than double that of any other age group. <\/p>\n

The next highest unemployment rate was for those aged 20-24 at 12%.<\/p>\n

\u201cThe rise in unemployment to 5.6% was larger than we and the market were expecting,\u201d said Westpac senior economist Michael Gordon.<\/p>\n

That followed an upward revision in the March quarter to 5.4% (previously reported as a fall to 5.3%), he said.<\/p>\n

\u201cOverall, we think the details are mixed from the RBNZ\u2019s perspective,\u201d Gordon said.<\/p>\n

\u201cThe unemployment rate rose by more than expected, and although the employment measures were mixed, on average they support our expectation of soft growth in activity over the quarter.\u201d<\/p>\n

ASB economists saw some positive details in the data.<\/p>\n

\u201cMuch attention will be given to the 11-year high in the unemployment rate,\u201d they said.<\/p>\n

\u201cHowever, labour demand growth was evident with employment up 0.5% and 13k jobs added over the quarter.\u201d<\/p>\n

However, the labour supply response was stronger, with annual population growth at 1.3% and labour force participation increasing 0.3 percentage points to 70.7%.<\/p>\n

\u201cImproving labour demand and supply metrics are good underlying signs despite the higher headline unemployment print,\u201d ASB said.<\/p>\n

Liam Dann is business editor-at-large for the New Zealand Herald. He is a senior writer and columnist, and also presents and produces videos and podcasts. He joined the Herald in 2003.<\/p>\n

Stay ahead with the latest market moves, corporate updates, and economic insights by subscribing to our Business newsletter<\/a> \u2013 your essential weekly round-up of all the business news you need.<\/p>\n","protected":false},"excerpt":{"rendered":"\u201cThe second quarter of this year was a tough one,\u201d Finance Minister Nicola Willis said, in response to…\n","protected":false},"author":2,"featured_media":559247,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[2246,70398,3225,138,28161,30271,4508,13419,111,139,69,13420,19257,13181,13421,131,1865,241,40866,2963],"class_list":["post-559246","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-2246","tag-70398","tag-according","tag-business","tag-expectations","tag-figures","tag-hits","tag-june","tag-new-zealand","tag-newzealand","tag-nz","tag-quarter","tag-rate","tag-released","tag-stats","tag-than","tag-today","tag-unemployment","tag-worse","tag-zealands"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/559246","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/comments?post=559246"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/559246\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media\/559247"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media?parent=559246"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/categories?post=559246"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/tags?post=559246"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}