NZ Unemployment Steady at 5.1% as Wages Rise, Budget to Prioritize Growth

New Zealand’s unemployment rate has remained unchanged at 5.1% in the March 2025 quarter, according to data released today by Stats NZ. This consistent figure provides a measure of stability in what continues to be a challenging economic environment. Finance Minister Nicola Willis has welcomed the data, calling it an “encouraging” sign that key economic indicators are holding firm despite global headwinds and domestic fiscal pressures.

The jobless rate is not only steady but also better than expected. Both the Treasury and the Reserve Bank had forecast a higher unemployment figure for the period, making this result a modest but meaningful surprise. The 5.1% rate is seen as a reflection of labour market resilience and the effectiveness of ongoing policy efforts aimed at supporting employment.

Wages on the Rise Amid Economic Pressures

One of the standout details in the latest Stats NZ report is the growth in average hourly earnings. Wages have risen by 4.5% over the year to March 2025, offering a small but tangible gain for workers facing rising living costs. This growth in earnings may provide some relief to households still grappling with inflation, housing costs, and other economic pressures.

While wage growth helps to boost consumer confidence and spending, economists are watching closely to see how these increases impact inflation trends and monetary policy decisions in the months ahead.

Minister Willis: Budget Will Focus on Responsibility and Growth

Finance Minister Nicola Willis took the opportunity to underline the government’s commitment to sound fiscal management. “While this result is encouraging, it reinforces the need for strong fiscal management and economic growth,” she said in a statement.

Willis acknowledged that many New Zealanders are still feeling financial strain. She emphasized that the upcoming Budget, set to be released on May 22, will prioritize responsible spending while fostering conditions for sustained economic recovery.

“It will be a responsible Budget that secures New Zealand’s future,” Willis said, indicating that fiscal prudence would be balanced with strategic investments aimed at growth.

Outlook Ahead of the May Budget

The steady unemployment rate, combined with rising wages, provides the Government with a platform to advance its economic agenda. However, uncertainty remains. Key sectors like construction and retail continue to face cost and labour challenges, and consumer confidence remains subdued in many regions.

Economic analysts anticipate that the Budget will likely include targeted investments in infrastructure, skills development, and measures to improve productivity — all intended to support long-term job creation and economic competitiveness.

As the country approaches the Budget announcement later this month, stakeholders from across the political and economic spectrum will be watching closely to see how the Government balances immediate economic concerns with longer-term strategic planning.