Last week, I published an article titled “Why New Zealand migration to Australia will fall”, arguing that New Zealand’s improving labour market would lead to fewer Kiwis migrating to Australia.
The argument was built around the following chart from Justin Fabo at Antipodean Macro showing how the ratio of SEEK NZ to Australian job ads has shot up recently, which has traditionally shadowed the difference between the two nations’ unemployment rates:
“If New Zealand’s unemployment rate narrows versus Australia’s, which seems likely, then we are also likely to see fewer Kiwis migrating to Australia in the period ahead”, I wrote.
It appears that my reasoning was premature, with Stats NZ’s labour force data for the June quarter revealing a 0.2% rise in New Zealand’s unemployment rate to 5.6% – the highest reading for the nation since December 2012.
The result was far worse than the Reserve Bank of New Zealand had forecast:
To add further insult to injury, New Zealand’s seasonally adjusted underutilisation rate also jumped to 13.8% in the June quarter, up 0.9% from the March 2026 quarter – the highest reading in 13 years.
Moreover, around 8,000 more people were experiencing long-term unemployment in the June 2026 quarter than in the same quarter in 2025, according to Stats NZ.
Finally, wage growth was also weak and below the CPI inflation rate. The Labour Cost Index measure of annual wage growth was 2.0% in the June quarter, which was below the CPI inflation rate of 4.1%, meaning real wages fell by 2.1%.
The following chart shows that the 1.2% gap between Australia’s unemployment rate (4.4%) and New Zealand’s (5.6%) is historically large and portends continued strong migration of Kiwis to Australia:
In other words, forget what I wrote last week; the latest official Stats NZ labour market release says otherwise.
Young Kiwis in particular, who are suffering the most from rising unemployment, are likely to continue arriving in Australia in large numbers in search of greater employment opportunities.
