New Zealand's unemployment rate has gone up to 5.6 percent, according to Stats NZ figures released this week. That is the highest it has been in nearly 11 years. The rate went up 0.2 percentage points from the previous quarter, and 8,000 more people are now without work, bringing the total to 171,000.

A wider measure called the underutilisation rate also rose. This includes people who have jobs but want more hours, and people who would like to work but are not currently looking. That rate went up to 13.8 percent, covering 440,000 people in total. The number of underemployed people — those working but wanting more hours — rose by 9,000 to 154,000.

The pattern has been gradual. A year ago, in the June 2025 quarter, the unemployment rate was 5.2 percent. It crept up over the following quarters and has now reached 5.6 percent.

Finance Minister Nicola Willis spoke on RNZ's Morning Report before the figures came out. She called the last quarter a "very difficult three months" but said some data was starting to point in "another direction" (RNZ). She pointed to more tourists, more international students, faster approvals for building projects, free trade agreements, and changes to the Holidays Act and Health and Safety Act as things the government is doing to help employers feel more confident.

Willis said high inflation, high interest rates, global tariffs and an oil shock had made the economic recovery difficult. Her tone has changed over time. In August 2025, she said unemployment was "lower than forecast" at 5.2 percent (Beehive). In February 2026, she welcomed 15,000 new jobs while noting the rate had risen to 5.4 percent, just below Treasury's forecast of 5.5 percent (Beehive).

On benefits, Willis confirmed that from November 2026, a new rule will apply. Parents earning more than $65,000 a year will have to support their 18 to 19-year-old children themselves, rather than those children getting benefits. The government is also making it harder to qualify for Jobseeker benefits in other ways. Around 14 percent of young people in Aotearoa are not in work, training or education.

Labour's deputy leader Carmel Sepuloni, on the same panel, said the government showed an "actual disregard" for families doing it tough. She pointed to Labour's plans to support employers taking on apprentices, starting in July 2028, and the party's Future Fund idea. Sepuloni said Labour would not have paused big infrastructure projects, would have put money into the health system, and would not have given tax breaks to landlords and the tobacco industry. She said Labour's full policy plans, including job creation details for the Future Fund, would come out in the coming weeks.

Willis said that was not true, and that the government "absolutely" cared about people who were struggling.

On wages, Stats NZ reported that the average hourly wage was $44.62 for the year to June 2026, up 2.8 percent. In the private sector, hourly wages rose 3.0 percent to $42.46. In the public sector, they rose 2.2 percent to $52.59. Average weekly pay for full-time workers rose 3.0 percent to $1,730. Private sector weekly pay rose 3.1 percent to $1,642; public sector weekly pay rose 2.9 percent to $2,062.

Stats NZ also fixed a mistake in survey data about why people worked fewer hours than usual in the December 2025 and March 2026 quarters. The survey sample was also updated for several industries in the June 2026 quarter.

What this means in plain terms is that unemployment has gone up in four of the last five quarters, and 5.6 percent is the highest rate since 2015. For a government that campaigned on being good with the economy, that is an awkward headline. Willis is now pointing to things like tourism and trade deals as signs the economy is turning around, even though the jobs numbers have not caught up yet. Whether she is right will depend on the next set of figures, due in September. For Labour, the opportunity is obvious. Sepuloni's focus on apprenticeships, infrastructure and the Future Fund signals what the opposition will keep arguing right through to the election. The tighter benefit rules, including the new parental income test from November, give Labour another line of attack: that the government is making life harder for people on benefits at the same time as more people are losing their jobs. Both parties, in other words, are looking at the same numbers and drawing very different conclusions.