The Employment Hero Jobs Report said Otago’s small and medium-sized businesses were expanding their workforces again, with data for May showing the region has experienced a resurgence in hiring over recent months.
Otago’s month-on-month employment growth reached 4% in May, based on a rolling three-month average, significantly outperforming the national growth rate of 0.6% and signalling renewed momentum after a softer start to 2026.
The latest figures suggest employers have resumed hiring following a brief slowdown earlier this year, lifting employment growth above the levels recorded throughout much of the second half of 2025.
The Jobs Report was a monthly snapshot of New Zealand’s labour market, with the Otago findings based on payroll data from more than 5100 local employees.
The recent acceleration suggests the region is closing the gap as employment opportunities increase.
Average monthly hours worked were 130.9 hours, with hours continuing to increase over recent months.
The lower figure, compared with the national average, reflected Otago’s workforce mix, including a large tertiary student population and high levels of seasonal and part-time employment.
Wage growth remains subdued.
Otago recorded 0.8% annual wage growth in May (three-month rolling average), slightly ahead of the national figure of 0.0%, but still well below inflation.
Wages have shown modest improvement in recent months, increasing 0.4% month-on-month in April and 0.6% month-on-month in May, suggesting early signs of upward momentum.
The region’s median hourly wage sits at $33.40, below the national median of $36.00, which is influenced by higher wages in Auckland and Wellington.
Employment Hero general manager New Zealand Neil Webster said Otago’s labour market appeared to be entering a new phase of growth.
‘‘The most encouraging aspect of this data is the turnaround we’ve seen over the past three months.
‘‘After a relatively subdued start to the year, businesses are hiring again, with employment growth now well ahead of the national average.’’
The recent hiring momentum suggested many SMEs (small and medium enterprises) were moving from a cautious approach to investing in new staff, Mr Webster said.
‘‘Employment growth is often one of the clearest indicators that businesses are seeing enough demand to justify expanding their workforce.
‘‘Otago’s recent figures suggest SMEs are beginning to shift from holding steady to growing again.’’
Despite the improvement in hiring, Mr Webster said wages remained the biggest challenge.
‘‘We’re seeing more employment opportunities emerge, but wage growth continues to be constrained.
‘‘While Otago is performing slightly better than the national picture, where wages have effectively flatlined, earnings are still growing more slowly than the cost of living.
‘‘The next challenge for employers will be translating stronger business activity into stronger wage growth.’’
Otago’s workforce profile also helped explain why average hours worked remain below the national average, Mr Webster said.
‘‘Otago has a unique employment mix, with a significant student population alongside seasonal industries such as tourism and hospitality.
‘‘That naturally results in a higher proportion of part-time work than many other regions.
‘‘What’s important is that employment and hours worked are both moving in the right direction.’’
