Mar 25
March 2025 Job Market Update: What Businesses Need to Know
Key Insights on NZ’s Employment Market March 2025 Edition
Welcome to our March edition! As we enter the third month of 2025, we’re seeing big shifts in the economy and employment market. Our goal is to keep you informed on what’s happening and how it impacts businesses and job seekers alike.
Economy, Economy, and Economy
Interest rates are finally easing, offering businesses and consumers some relief. Six-month home loan rates averaged 5.85% in February, down from a peak of 7.34%—a clear sign that financial pressures are starting to ease. But despite this, business confidence has dropped to 53%, down from 61%. The key issue? Consumer spending remains cautious.
While lower interest rates help businesses take a breath, they don’t solve the bigger issue—the high cost of living continues to weigh on consumer confidence. Until people feel financially secure, spending will remain sluggish. The economy is showing signs of recovery, but frustration lingers as progress remains slow.
Employment Market Growing?
Landing a job in today’s market remains tough, with some roles receiving over 1,000 applications. The latest data shows unemployment has risen to 5.1%, up from 4.8% last quarter, while salary and wage rates (including overtime) have increased by 3.3%. Many businesses are holding back on hiring, opting instead to stretch existing staff to cover workloads.
However, there are signs of improvement. The summer hiring boom has sparked renewed optimism, and SEEK data shows January job ads rose 4% month-on-month, marking the strongest growth in five months. While challenges remain, experts believe this downturn isn’t as severe as previous ones. As Kiwibank chief economist Jarrod Kerr puts it:
“Although it’s horrible to say, especially to anyone caught up in the current downturn, it’s not as bad as previous downturns. Different shades of ugly. We saw a lot more job losses in the wake of the GFC and severe job losses in the early 1990s. But recessions are still recessions, and people get hurt, and inequality widens.”
What’s Next for the Economy and Job Market?
As businesses navigate rising operational costs, many are reassessing their hiring strategies. Labour productivity has declined for five consecutive quarters, making efficiency a top priority. Instead of expanding teams, companies are focusing on upskilling existing staff and automating processes to maintain output.
Meanwhile, wage growth has slowed to 3.3%, down from 4.3% last year, signaling that while pay is increasing, it’s not keeping pace with inflation. With job vacancies still 20% below 2022 levels, competition remains high for job seekers, but early signs of hiring recovery suggest this trend could shift by mid-year.
For businesses, retention is more important than ever. Keeping skilled workers engaged in a tough job market will be key to maintaining stability and positioning for future growth when conditions improve.
This is where Indus can help. Whether you need to find the right talent, scale your workforce efficiently, or streamline hiring, we connect businesses with the right people—quickly and effectively.