NZ salary guide 2026: Employers face stubborn skills gap as talent flees to Australia
Wednesday, 18 February 2026
New Zealand business is facing a 2026 in which moderate economic growth will likely feature - but employers are also facing more of a scrap for those with the right skills, and will likely have to pay candidates more.
Despite large numbers of unemployed right now, more than 80% of employers have had trouble filling a skills gap over the last year. And the large large number of not just young people, but professionals and families, leaving for Australia over the last few years has left gaps in the workforce employers will have to pay more to fill, finds one of the country’s largest recruitment consultancies.
The latest Salary Guide from Robert Walters Australia and New Zealand, out today, finds evidence that in general, more employers are seeking to hire staff in the coming year. Christchurch in particular stands out for its buoyancy, with 78% of businesses looking to hire in the Garden City (as opposed to 75% in Auckland and 72% in Wellington) and 61% of Cantabrians confident in their local job opportunities, as opposed to 60% of Aucklanders and just 48% of Wellingtonians.
The Salary Guide, which surveyed 2300 white collar workers across 12 different industries, saw 76% of businesses looking to hire, up by 10% on last year.
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It found that 67% of businesses said they’d be offering salary increases in 2026, after a more constrained 2025 in which 57% of New Zealand professionals received a rise, even if they were more in the 2.5% - 5% range, limiting their real impact in a cost of living crisis.
Counterbalancing that, however, was that only 53% of employees were looking to move roles - down 10% in the last year - suggesting “they are a little bit gun-shy after what we've seen in 2023 and 2024 and the earlier parts are 2025 - and that there’s still a fear of ‘last one in, first one out’ scenario”, said Robert Walters chief executive Shay Peters.
Hiring processes had also become longer as employees took a more cautious approach to jumping ship.
Skills shortage
With a 5.4% seasonally adjusted unemployment rate in the December 2025 quarter - the highest in a decade - Peters said what the white collar recruiter was seeing “on the ground” at the moment was “slack or capacity in the system is starting to wane. And I think we're getting to the point where businesses are definitely keen on investing in future resource.”
At the same time, and despite the historically high level of unemployment, skills shortages remain widespread, the data showed. More than 80% of employers reported experiencing a capability gap in the last year - and there is a fear that too much of this could lead to lower productivity and growth in general.
“This challenge is particularly evident in major centres, with Auckland at the top with 52% of employers reporting skills shortage, followed by Wellington with 49% and Canterbury at 39%,” said Peters. “The consistency of these figures across regions show that it's not short term fluctuations, but a structural issue in the labour market.”
The skills most likely to be missing included industry-specific expertise, digital, tech and leadership skills - “the skills required to execute strategy, adapt to change and lift productivity”, he noted.
Gone to Oz
The situation has been intensified by the large-scale movement of workers to Australia. Overall, over 120,000 people left New Zealand in 2024 and 2025, with Australia being the primary destination. They were not all the usual OE-seekers.
“The biggest concern I saw was the profile of Kiwi that was moving … they were the type of New Zealanders that weren't going to come back,” said Peters. “People with families were actually selling their houses and moving to Australia to further their careers. And once they get settled in, it's very hard to bring them back.
“People at that level have a massive impact on our productivity in New Zealand. My concern is that we lost a lot of knowledge during that period of time. Hopefully, as the economy starts to strengthen in New Zealand, we start to retain our top talent here.”
The data from the report however shows Australian remains the number one favourite place to relocate to - with 65% of professionals saying they’d move there, were they to relocate - and by far the main reason was for better pay.
Unemployment peaked?
Westpac chief economist Kelly Eckhold, who presented alongside Robert Walters, said “cautiously optimistic” expressed how the bank was viewing the year ahead, with the emphasis on the “cautiously” given how early it was in the year.
“The good news is that in the most recent data, what we see is firms increasingly telling us that they have actually been doing more business than in the recent past, and there's a lot more conformity across the surveys in terms of their willingness to employ and invest” in the expectation things would be picking up.“
Eckhold said two factors were driving the pick-up in the labour market - strong exports, including tourism, and lower interest rates. These started being cut in August 2024, and the country was in the “sweet spot” right now where those cuts were flowing through to confidence and activity.
Employment remained a lagging indicator, but he said he felt unemployment was starting to peak: “We expect that we'll get a decent fall in the unemployment rate as we go through this year,” he said.
The labour market lagged the general economy as employers had to spend so much hiring and training staff, and must be sure they want to hire before they do.
“In the last couple of years, we've noticed that firms have held on to staff, and they did that because it was so hard for them to build up staff five years ago [after Covid] - it means that right now, there's probably not as much hiring as you might hope would occur given the amount of activity, because people want to run the workforce a bit harder for a while before they actually start to hire.”
That didn’t mean wage growth would take off any time soon, however. Eckhold said unemployment would have to decrease about a percentage point before wages rose. And then, they would still not be anywhere near the “silly season” wage inflation of 2021-2022, he said.
Business expectations
RBNZ released its Business Expectations survey for February today, looking at inflation expectations held by key business decision-makers. This group increased their expectations for the one-year-ahead unemployment rate, to 5.18%, and their two-year-ahead unemployment rate expectations increased to 4.92%.
These are still lower than the current 5.4% unemployment rate.
Retail industry respondents and small businesses were the most pessimistic about the unemployment rate.
In keeping with Robert Walters’ expectations of wage inflation, those surveyed agreed higher wages would need to be paid across all time horizons - for one-year-ahead, annual wage inflation expectations increased by 15 basis points to 2.71%, while in two years it was expected to increase to 3.19%.
All businesses thought wages would inflate, but those in the primary sector had the most optimistic expectations.
Business expectations for annual consumer price inflation one and two years ahead increased, while expectations for five and 10 years ahead declined. Survey respondents had increased expectations for inflation in a year’s time, to 2.60% and in two years time they felt it would be at 2.59%. Five-years-ahead inflation would be at 2.73% and in a decade, 3.21%, they said.