Economic sentiment

As we move through 2026, the Auckland market is showing signs of recovery.

The employment market has improved from last year’s lows, with national unemployment easing slightly to 5.3% in the March 2026 quarter. However, the broader economic picture remains fragile, and Auckland continues to recover unevenly. Recent Auckland economic data shows annual GDP growth remains barely positive, with Auckland underperforming the rest of New Zealand over the year to December 2025.

Earlier optimism has also softened. The NZIER Quarterly Survey of Business Opinion showed business confidence falling sharply in the March quarter, with only a net 1% of firms expecting better economic conditions ahead, down from 39% in the previous quarter. Hiring and investment intentions have also weakened, reflecting the impact of renewed global uncertainty, supply chain disruption and rising cost pressure.

This is where the conversation for leaders has shifted. We are no longer talking about waiting for certainty before making decisions. Volatility is now part of the operating environment. Oil price pressure, geopolitical disruption and changing trade relationships are reinforcing a point many businesses are already feeling: supply security is becoming just as important as supply efficiency.

For New Zealand, and Auckland in particular, this matters. We are a small, trade-exposed economy, and global shocks reach us quickly. Organisations that have built operating models purely around efficiency are now having to reassess resilience.

Monetary policy is also no longer providing the same straightforward tailwind it appeared to earlier in the year. The RBNZ held the Official Cash Rate at 2.25% in April, noting that global events had materially altered the outlook, with near-term inflation expected to increase and economic recovery to weaken.

Against this backdrop, hiring is improving, but it remains highly selective. Businesses are still investing, but the threshold is higher. Every role needs to have a clear link to resilience, productivity, risk reduction or growth. The organisations moving best through this market are the ones getting more disciplined about where capability will make the biggest difference, rather than waiting for conditions to ease.

Technology and IT market

Auckland’s technology market is following the same pattern: stronger than it was, but still highly targeted.

SEEK data for March showed New Zealand job ads up 13% year-on-year, with Auckland also higher year-on-year despite easing slightly month-on-month. ICT job ads were up 10.1% year-on-year, supported by demand for software engineering and core digital capability.

That said, this is not a return to broad-based technology hiring. The era of unchecked digital spending is over. TUANZ has shared that organisations are under real pressure to prove the value of past and future technology investment, particularly across software licensing, cloud platforms and transformation programmes. The shift they have seen is from “cloud-first” to “cloud-smart”: less hype, more scrutiny, and a sharper focus on measurable business value.

Demand remains strongest in areas tied directly to resilience and productivity; data platforms, cyber security, architecture, cloud optimisation, business systems, governance, risk and compliance, and delivery capability. These are the roles that help organisations reduce risk, improve decision-making and unlock value from the infrastructure they have already built.

AI is now accelerating this shift. It is no longer something sitting outside the business in a strategy deck or innovation lab. Employees are already using AI tools to draft, summarise, analyse and automate parts of their work. The risk is not simply whether AI is being used, but whether it’s being used with the right governance, data protection, quality control and human oversight.

The next phase of AI adoption will be less about experimentation and more about execution. Organisations need to start with business value, not tools: identify the right use cases, set baselines, define success measures, establish ownership and build governance in from day one. Not every problem needs AI, and leaders need to be clear on where automation is enough, where AI adds value, and where human judgement must remain central.

Auckland also needs to confront a deeper digital capability challenge. Aotearoa has strong foundations, including world-class fibre and robust digital governance, but the latest Network Readiness Index ranks New Zealand 23rd globally, with its greatest improvement opportunity sitting in People and particularly weak performance in the Individuals sub-pillar. In simple terms, we have built many of the roads, but we are not yet driving on them fast enough.

This is why capability depth matters so much. AI will not deliver meaningful ROI on fragmented data, unclear ownership or outdated information architecture. Before organisations can scale advanced tools, many will need to clean up legacy systems, improve data quality and strengthen governance.

The talent implications are significant. Demand is growing for AI adoption specialists, data engineers, platform specialists, cyber professionals and leaders who can connect technology investment to commercial outcomes. At the same time, generative AI is beginning to reshape early-career pathways by automating some of the tasks junior talent traditionally used to build experience. If organisations are not deliberate about training, coaching and progression, today’s productivity gain could become tomorrow’s senior talent shortage.