NZ hiring rebounds as wages remain stuck in neutral

Auckland, New Zealand, 12 October 2026 — Kiwi pay packets have flatlined even as small and medium businesses ramp up hiring, with new employment data showing median wages have remained unchanged for three consecutive months.

According to the latest Employment Hero Jobs Report, the median hourly rate remained at $36.06 in September, with wage growth flat both month-on-month and across the last quarter.

The slight positive, says Employment Hero General Manager NZ Neil Webster, is that annual wage growth edged up to 1.1%, but he cautions against reading too much into the increase.

“Annual wage growth has collapsed from roughly 4–5% mid last year to just 1.1% last month. That slight uptick in September could be the start of a recovery, but only time will tell. It could just be a monthly fluctuation.”

Wages looked brighter for part-time and casual workers, with positive growth of 3.5% and 3.7% respectively, highlighting a growing divide between different types of employment.

The Employment Hero Jobs Report draws on more than 3,300 businesses and 73,000 employees. The data provides a real-time view of employment and wage trends across New Zealand’s SME sector.

SMEs add jobs at second-fastest pace of 2026

While the unemployment rate remains high at 5.6%, according to Stats NZ, the SME sector saw employment growth rebound sharply in September, rising 2.0% from August and 4.4% compared with three months ago.

The September reading is the second-strongest monthly employment result of 2026, behind the mid-year peak of 2.6% in July.

Webster says the rebound is an encouraging sign that businesses are becoming more confident about taking on staff, although the lack of wage growth remains a concern.

“It’s been a choppy year, but with headcount climbing back to 2.0%, up from a dip of 0.7% in August, it’s a good bounce back,” says Webster.

“What’s harder to reconcile is that wages aren’t following at a time when the cost of living continues to be top of mind for people. Businesses are hiring, but employees aren’t yet seeing the same momentum in their pay packets.”

The Bledisloe Cup employment battle  

Kiwi hiring momentum in September is in contrast to Australia’s quarterly employment growth which is nearing a two-year low. 

“The contrast with Australia is notable because the divergence is an important signal for businesses on both sides of the Tasman,” says Webster. 

“We’re seeing two very different employment stories emerging where New Zealand’s SME employment momentum is strengthening, while Australia’s is moving in the opposite direction.”

The New Zealand figures suggest the labour market may be starting to turn a corner, but the recovery remains uneven.

“The September numbers give us a reason to be cautiously optimistic. Hiring is moving in the right direction, but we need to see whether that momentum can be sustained and, importantly, whether wage growth starts to catch up.” 

South Island continues to outpace the North 

The South Island continued to lead the employment recovery, with headcount increasing 1.3% month-on-month and 9.4% compared with three months ago.

“The South Island continues to be a real bright spot. Quarterly headcount growth was nearly four times that of the North Island and September continued that trend,” says Webster.

“It’s a strong result for businesses in the South, but the same wage story is playing out. Whether you’re in the North or South Island, wage growth remains weak relative to hiring.”

At a regional level, monthly headcount growth was led by Otago (+4.1%) and Waikato (+1.6%), followed by Northland (+0.9%), Wellington (+0.5%), Auckland (+0.5%) and Manawatū-Whanganui (+0.4%).

Canterbury and Bay of Plenty were broadly flat, both recording 0.1% growth.

The weakest regional employment results came from Marlborough (-3.9%), Hawke’s Bay (-1.9%), Nelson (-1.3%) and Taranaki (-1.1%).

Auckland wages slipped 0.6%, while Wellington remained flat.

“The regional picture shows there isn’t one single New Zealand recovery happening right now,” says Webster. “Some regions are hiring strongly while others are contracting, and wage performance varies just as widely.”

Spotlight on key sectors

The strongest employment growth in September came from Manufacturing, Transport & Logistics, where headcount jumped 8.4% month-on-month and 7.7% year-on-year. However, wages fell 1.8% over the month and 0.5% year-on-year, highlighting the disconnect between hiring and pay growth.

Engineering also recorded strong employment growth, up 6.0% month-on-month, while Accounting, HR & Legal (+4.6%), Retail, Hospitality & Tourism (+3.2%) and Education & Training (+2.7%) also added workers.

Education & Training provides another example of the wage disconnect, with employment up 2.7% in September while wages fell 7.8% month-on-month.

“The sector data reinforces the bigger picture – businesses are hiring, but wage growth is still lagging behind,” says Webster. “That’s encouraging for the employment market, but employees aren’t necessarily feeling the benefit in their pay packets yet.”

Science & Technology was one of the stronger sectors for annual wage growth, with wages up 4.4% year-on-year, alongside 6.2% annual employment growth.