Retail spending rose 0.6% in January despite ‘sobering’ rise in unemployment
Thursday, 5 February 2026
Worldline says consumer spending rose 0.6% to hit $4.02 billion in January.
The modest rise was a “positive” start to the year, after a fall in spending in the final month of 2025 and after a more subdued Boxing Day sales period.
Worldline NZ chief sales officer Bruce Proffit said there was a marked fall in spending on Wednesday, January 21, when storms and heavy rainfall caused floods and slips in some areas of the country.
Spending that day was down 5.6% to $118 million, from $125m recorded on the same day a year earlier.
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Declines in spending continued in the Bay of Plenty, Gisborne and Waikato over the following Auckland Anniversary long weekend, including at hospitality merchants, the latest payment data shows.
“The total hospitality spending through Worldline NZ’s payments over the four days ending January 26 for these three regions, plus Auckland/Northland, was $71.2m - down 8.7% on Auckland Anniversary weekend last year,” Proffit said.
“In contrast, Wellington Anniversary weekend had seen hospitality spending down 7% amongst Palmerston North, Whanganui, Wairarapa, Wellington regions, but this appears to be due to local economy factors, rather than the weather-related ones.”
Impact from the storms over the month resulted in Bay of Plenty and Gisborne being among the weakest regions in the country, Proffit said.
Spending in January was the lowest in the Bay of Plenty, down 3.4%. In Taranaki it was down 3%, and in Gisborne it was down 1%.
Spending growth was highest in Whanganui, up 2.5%, followed by Hawke’s Bay and Palmerston North, both up 1.9%.
Retail NZ chief executive Carolyn Young said the overall rise in spending in January gave retailers hope that “those green shoots we have been talking for several months might start to come through more strongly”.
“It’s early days and it is off a low base, but it gives us something to be upbeat about following the disappointing December sales and yesterday’s unemployment data,” Young said.
Stats NZ unemployment figures released on Wednesday made for sobering reading, Young said. The unemployment rate for the December 2025 quarter rose to 5.4% - its highest rate since September 2015.
Young said those figures meant retailers would be preparing for some slow months ahead, as “getting by” would remain a focus for consumers.
She said it could be some time before consumer confidence improved to a level needed to see a material upturn in sales.
“Retailers have been experiencing tough trading conditions for some time now, and while business confidence is largely positive overall, it is clear it could be some time before New Zealanders feel confident enough in the economic conditions to increase their discretionary spending.”
Young said many retailers would be feeling as though they were “just treading water as the economy moves sideways, rather than forward”.
The latest Centrix data shows retail business liquidations are up 34% year-on-year, and company liquidations in 2025 were at their highest level since 2010.