South Island leads NZ wage & job growth as market rebounds

Employment Hero's July employment data indicates early signs of improvement in the New Zealand labour market, along with notable wage growth in the South Island and among trades.

Recent data from Employment Hero, which is based on aggregated anonymised employment statistics from more than 10,000 businesses and approximately 70,000 employees in New Zealand, reveals specific trends in hiring and wage patterns through to the end of July 2025. The insights come in contrast to official figures from Stats NZ, which reported New Zealand's seasonally adjusted unemployment rate rising by 0.1% to 5.2 percent at the end of the June 2025 quarter.

Hiring activity

Ben Thompson, Chief Executive Officer of Employment Hero, said the on-the-ground reality may be more dynamic than official data suggests. He stated,

"The official stats might be stuck in neutral, but real-time hiring data tells a different story - green shoots are starting to sprout. Employment Hero's latest NZ numbers show employment growth sitting at an average of 2.4% to the end of July, with casual roles surging 10.2%. That's not static - it's definite movement and while the annual figures are still digging out of a hole, the quarterly trend is upwards. Job seekers might finally be seeing the start of a turning tide even if the official spreadsheets haven't caught up yet."

The data released by Employment Hero highlights a 2.4% average increase in employment, driven particularly by a 10.2% increase in casual positions. Year-on-year, the South Island led with employment up by 5.4%, compared to just 0.6% in the North Island. Across contract types, casual work rose 10.2%, whereas part-time and full-time roles experienced modest growth of 0.4% and 0.2% respectively.

The construction and trade sectors saw the strongest annual employment rise at 10.4%, followed by retail, hospitality, and tourism with a 4.2% increase. Age group analysis showed substantial employment gains among younger workers: the number of employed 18–24-year-olds increased by 13.8%, while 25–34-year-olds saw growth of 3.5%.

Thompson provided additional commentary on differences between Employment Hero's real-time data and trends reported by major job boards. He said,

"This might be because employees aren't looking to just traditional job sites to find work anymore and AI-enabled hiring platforms are starting to win a porting of the market fed-up with traditional platforms. People don't want to feel like just another application in a big old pile. We use cutting-edge AI technology called 'SmartMatch' which proactively presents roles that fit a candidate's skills and goals, even if they've never applied for them. It's personalised recruitment that sees roles come to them."

Wage growth

Employment Hero's payroll statistics show a 4.0% rise in median wages nationwide for the year up to July. The figures reflect variability across regions, industries, and contract types - a pertinent issue with pending legislative changes such as the Employment Relations (Employee Remuneration Disclosure) Amendment Bill, which will prohibit pay secrecy clauses, and an increase in the living wage to NZD $28.95 per hour from September 2025.

The South Island recorded a 5.1% increase in median wages year-on-year, compared to 4.7% for the North Island, with the North Island's hourly median higher at NZD $36.50 versus NZD $33.70 in the South Island. Part-time wages rose most sharply, up 5.3%, followed by full-time wages up 4.3%, while pay for casual roles declined by 1.1% year-on-year. By sector, construction and trade services led with wage growth of 6.2%, followed by science and technology at 5.1%. By age group, 25–34-year-olds recorded the highest wage increase at 5.8%, with 45–54-year-olds closely following with 5.5%.

Sharing his perspective on these disparities, Ben Thompson said,

"It's encouraging to see median wages climbing, but not all workers are feeling the lift equally. While some industries and age groups are enjoying above-average gains, others are flatlining or even going backwards. With pay secrecy set to end, we'll see a sharper focus on who's winning and who's missing out and whether pay aligns with living wage standard. Employers need to be ready for those conversations."

He further stated,

"Once pay secrecy is gone, the numbers will speak for themselves. Workers will know where they stand and the best talent will gravitate toward employers who can prove they pay fairly and competitively."

Employment Hero's research highlights the nuanced picture within New Zealand's labour market - pointing to increased hiring activity in specific regions and sectors and raising questions about pay equity and recruitment practices ahead of legislative changes.