New Zealand SME employment grows as full-time wage growth story flatlines

New Zealand employee pay packets have flatlined even as small and medium businesses ramp up hiring, with new employment data showing wages have not grown in three months. 

The positive news, says Employment Hero General Manager for New Zealand Neil Webster, is that annual wage growth edged up to 1.1 per cent in September compared to an annual increase of only 0.3 per cent in August, but he cautions against reading too much into the increase.

“Annual wage growth has collapsed from roughly 4 to5 per cent mid last year to just 1.1 per cent last month. So while September indicates some green shoots, with year-on-year growth the highest since March this year, it could just be a monthly fluctuation so only time will tell. Because currently the trend is still a downward one.” 

Wages looked brighter for casual workers, with positive growth of 3.7 per cent, highlighting different outcomes across different types of employment. 

The Employment Hero Employment Index reports the monthly pulse of New Zealand small and medium businesses. The September 2026 story for Kiwis is clear, hiring at SMEs is edging up, wages are flat, with casual employees seeing highest growth in wages

Breaking hiring patterns down by region, the South Island has shown stronger recent momentum with quarterly headcount growth nearly four times the North Island, with September continuing that trend. Across both the North and South Islands, wage growth is weak relative to hiring.

Hiring bounces back as SMEs add jobs at second-fastest pace of 2026

The overall New Zealand unemployment rate remains high at 5.6 per cent (Stats NZ), but the SME sector saw employment growth rebound sharply in September, with headcount rising 2.0 per cent from August and 4.4 per cent 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 per cent in July.

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

“It’s been a choppy year, but with headcount climbing back to 2.0 per cent, up from a dip of 0.7 per cent 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.”

Accounting, legal, and engineering big winners on hiring and wages 

Different New Zealand sectors are telling different stories, with accounting, legal, and engineering the places to be for hiring sprees and wage increases. 

The accounting, human resources, and legal sector hiring was up 4.6 per cent on the previous month, with wages also getting a nice boost of 3.3 per cent on the previous month. Engineering talent meanwhile enjoyed a 6 per cent hiring boost on the previous month, with a modest 0.9 per cent median pay increase to go with it. 

Kiwi productivity per person opportunity

New Zealand SMEs broadly on the lookout for high-productivity employees with scarce skills, particularly those who can help businesses grow, automate, export, commercialise technology or improve overall productivity.