Counselling students say the financial burden of unpaid placements is a huge barrier for people trying to make it into the mental health workforce, and many are dropping out.
It’s causing concern about a shortage of counsellors, after a recent survey indicated more than one in five professional counsellors are planning to retire, scale back their work, or leave the profession in the next two years.
A student who wanted to be known as James, was studying a Postgraduate Diploma in Counselling and Guidance at Massey University and said he’d seen many people leave.
“There are multiple people I know who have quit or decided that they won’t be doing the Masters next year, specifically because of the financial issues.
“There are a lot of people who are great and they would be fantastic counsellors, and they want to be counsellors, but they’re like, I can’t do it,” he said.
James was planning to complete his Masters in counselling, which required a minimum of 200 hours of counselling practice with actual clients. He said this was unpaid work, which many of the students felt was unfair.
“I can understand if they’re like, hey, you’re not as trained as a person with the masters. We won’t pay you quite as much. But they won’t even pay the same as someone working at a dairy or… a newspaper run.
“It’s just setting us up to be closer to poverty. And it’s expected that we somehow show gratitude for the opportunity.”
A fellow student agreed, saying the expectation of unpaid training hours was a “big problem”.
“There’s a minimum wage for training that is $19.16 per hour, and how can that not apply to our profession in the sense that we have already got a postgraduate diploma in that area and we’re doing the practical training.
“How are we not getting paid even the minimum wage for that?,” she said.
The student, who wanted to remain anonymous, said the course began with about 200 students attending the online lectures, but that’s dropped to about 30.
She said one of the biggest challenges was being unable to take on paid work while studying.
“For me, that’s a huge barrier being a young mum with kids and having unpaid placements, and a huge student loan. I’m probably looking at like $100,000 debt by the end of it and no pay for 4 years.”
The Association of Counsellors’ 2026 Counselling Workforce Report found nearly a quarter of student respondents had difficulty finding a placement, and many said the full-time commitment placements require caused real financial strain, especially alongside childcare or other work.
Growing waitlists for whānau needing counselling
Eugene Davis from the Association of Counsellors, said the demand for counsellors was huge – especially after the government cut hundreds of Oranga Tamariki contracts in 2024.
“Waitlists are fully growing with other organisations… we’ve got whānau waiting for counselling and that’s because there’s no practitioners, there’s no jobs for these practitioners to sort of receive that demand. Resourcing for councilling jobs is pretty scarce,” he said.
He agreed unpaid placements were a barrier for some students, and said financial support varied greatly depending on the tertiary programme and placement provider.
Davis said there could be more understanding of students situations, especially as many were older students with families to provide for.
“I think it might be too black and white at times. I think those conversations need to be held intentionally at the start.”
He wanted to see more support from government and universities for counselling students, so that more completed their studies and made it into the workforce.
“Counselling as a profession doesn’t get the recognition it should.
“Counsellors are as highly trained and educated as psychologists, yet the profession keeps getting pushed down the priority list,” he said.
The 2026 Counselling Workforce Report found once students graduate, over 50 percent of them are most worried about finding a job, and about 46 percent are worried about paying for supervision, which is a mandatory cost for new counsellors.
“We’d like to see more thought given to the pathway from studying into paid work, placements included,” Davis said.
Funding for some placements, but not others
Counselling students said they felt hard done by that other similar mental health studies were financially supported, such as psychology internships.
Health New Zealand’s Executive Director People & Culture, Health & Safety Robyn Shearer, said they do fund psychology internships, but that it’s a different situation to counselling placements.
Health NZ’s Robyn Shearer. (File photo)
RNZ Insight/Karen Brown
“Where interns hold a level of professional registration and can practise under supervision. These internships are distinct from student training placements that form part of a qualification programme,” Shearer said.
She said Health NZ knows placements could create financial pressure for some students, and were supporting a range of student placements across various services.
“The availability of counselling student placements can vary depending on service needs, supervision capacity, and training requirements.
“We remain committed to working with education providers and the sector to grow and strengthen the future mental health and addiction workforce.”
A Massey University spokesperson said the drop out rate was “very low” for Master of Counselling at Massey.
“If a student leaves the programme, it is usually because of exceptional personal circumstances, and they rejoin the programme in the following couple of years.”
The spokesperson said Massey did not receive any funding to support students on placements.
“To date the Master of Counselling programme has not financially supported placements.
“The agreement between the placement provider and Massey is generally one that is a reciprocal arrangement with the agency or organisation being able to extend their counselling services with our student volunteers which in turn contributes to the students learning.”
The university said it was very proud of the structure of its two counselling programmes, and the positive outcomes for students.
The Minister for Tertiary Education, Penny Simmonds, said universities and other tertiary institutions have a “high degree of institutional autonomy and academic freedom”.
“This allows providers to make decisions about programme delivery, placements and financial support, including scholarships,” she said.
The minister said tertiary education providers determine qualification requirements, including whether placements were required and if they were paid.
“The government provides support to help reduce financial barriers to tertiary study, including tuition subsidies, student loans and student allowances.
“Students on unpaid placements may be eligible for a student allowance or student loan living costs. Additional support may also be available through accommodation assistance and scholarships,” Simmonds said.