Total Labour Force

IBISWorld forecasts the total labour force to increase by 0.7% in 2024-25, to reach 3.08 million people. This represents a significant slowing compared to strong growth in the total labour force witnessed in 2023-24. Net migration has trended downwards across Q1 and Q2 2024-25, with this trend anticipated to continue into the second half of the year. This follows tightened regulations to the Accredited Employer Work Visa (AEWV) that were introduced in June 2024, rectifying leniency in the legislation stemming from pandemic workforce shortages. New Zealand’s population has grown but growth rates have slowed, which has also kept growth rates in the labour force contained.

The size of the New Zealand labour force has grown consistently over the past five years. Generally, labour force growth is closely correlated with population growth. Trends in net migration of working-age individuals strongly affect the size of the national workforce. Net migration dramatically dropped into negative figures during the pandemic years, which limited the growth of the labour force. However, growth in the construction sector drew local residents into the workforce, helping to offset the sharp decrease in migrant workers. A return to positive net migration in 2022-23 coincided with an increase in the growth rate of the total labour force after growth had been relatively stagnant between 2019-20 and 2021-22.