After 12 months of job contraction, is the tide starting to turn?

This week’s 50 basis point cut to New Zealand’s Official Cash Rate (OCR), bringing it to 2.5%, is the Reserve Bank’s most decisive monetary move in over a year. It lands at a time when the labour market has been trending downward – with a reported 1.2% annual decline in filled jobs to June 2025.

However, at Magnetic, we’re beginning to see early signs of renewed hiring activity – especially in strategic and future-focused roles.

According to Stats NZ, New Zealand’s filled jobs decreased by approximately 27,850 roles between June 2024 and June 2025 — a 1.2% decline.

Key insights from the data:

• Sectors with the largest year-on-year job losses include construction, manufacturing, professional, scientific, and technical services, and administrative and support services.

• Some sectors saw modest gains, including education and primary industries

• The drop is primarily in operational and project-linked roles — not in senior or specialist positions

While headlines suggest contraction, the employment story is more nuanced. Much of the market has stabilised at a lower baseline and now we’re seeing signs of selective movement upwards.

What the OCR cut signals for employment

While monetary policy doesn’t create jobs directly, the cost of capital has a major influence on hiring behaviour. The OCR cut is expected to stimulate investment and reduce cost pressures for businesses.

We’re seeing this reflected in three key ways:

1. Reassessment, Not Rebound

Organisations are re-evaluating their hiring plans but very few are expanding teams rapidly. Instead, there’s a renewed focus on role value and necessity, team structure and alignment and operational efficiency

This is strategic workforce planning, not broad growth hiring.

2. Strategic Roles Are Reappearing

We’re seeing a rise in demand for business-critical roles, particularly where teams are reactivating paused initiatives or preparing for a recovery phase. This includes Health and Safety leaders, Project and programme delivery roles, Compliance and transformation specialists, Operations and supply chain professionals.

3. Confidence is Rebuilding, Slowly

Hiring is still measured, but intent is increasing. Employers are beginning to explore talent pipelines again, revisit succession planning, identify capability gaps for 2026 and beyond. This cautious optimism marks a shift from the defensive posture of the last 9–12 months.

What to watch in the coming months

The impact of the OCR cut will take time to fully materialise, but these are key developments to monitor:

• Capital project hiring: Particularly in infrastructure, as financing becomes more accessible

• Technical and regulatory roles: Especially where compliance and efficiency are priorities

• Regional hiring recovery: Variability across Auckland, Waikato, Bay of Plenty, and Canterbury

• Candidate mobility: A slow return of professionals actively exploring new roles, emphasis on encouraging ex-pats back to NZ, and migrants filling the skill shortage.

Magnetic’s Viewpoint

We don’t expect a hiring boom. But we do expect more movement, particularly in strategic and senior-level roles where the value case is strong.

We’re already seeing job briefs increasing again, employers engaging more deeply in workforce planning, and the cautious reallocation of budget toward critical roles.

The OCR cut acts as a confidence lever and confidence is slowly returning. Organisations want to be positioned for what’s next, not left behind.

Let’s Talk Talent

At Magnetic, we’re closely tracking the interplay between macroeconomic trends and sector-specific employment activity across New Zealand.

If you’re reassessing your workforce strategy, we’re here to provide insight, not just on talent acquisition, but on where and how to build capability for the future.

Get in touch to discuss your hiring roadmap or request a tailored market update for your sector.