New Zealanders Are Still Finding It Tough Financially; Little Reprieve Expected In The Next 12 Months

Ipsos New Zealand has released the latest edition of Understanding Aotearoa New Zealand: Cost of Living report, a survey which tracks how New Zealanders feel about their finances and their expectations for the next 12 months.

Key findings include:

• 1 in 4 (26%) New Zealanders are finding it difficult to manage financially. This figure has remained relatively steady in the last two years, but represents a 6ppt increase since monitoring began in May 2022.
• Low-income households are disproportionately affected by financial difficulties, with a 13ppt increase in those who report finding it difficult since May 2022.
• Nearly half (47%) are worried about their job security, with women significantly more likely than men to be concerned (54% women vs. 39% men). 2 in 3 (65%) also believe that unemployment will rise in the next year.
• Of those who are worried about their job security, 83% say they are spending less, indicating a correlation between job security and consumer confidence.
• The vast majority of New Zealanders are expecting increases in household spending, particularly on essentials like food (80%), utilities (80%) and other household shopping (75%).
• 41% think their disposable income will decrease in the next year, and fewer than a quarter (22%) expect an improvement in their standard of living.
• Despite growing expectations that interest rates will fall (45%, a significant 21ppt increase from May 2024), the majority (52%) still believe that inflation will rise in the next 12 months. A similar proportion (49%) believe that it will take more than 12 months for inflation to return to normal in New Zealand, while 15% do not expect inflation to ever return to normal.
• The state of the global economy is perceived to be top factor contributing to the cost of living in New Zealand (80%). This is followed by interest rate level and government policies (73%).

Carin Hercock, Country Manager, Ipsos New Zealand, said: “This report gives us some insight as to why New Zealanders still see inflation as the most important issue facing New Zealand. New Zealanders are not making the connection between reductions in the official cash rate to an improvement in living costs. Instead, the majority believe that major household costs like groceries, power and insurance will continue to increase in the next six months.”

Amanda Dudding, Executive Director Public Affairs, Ipsos New Zealand, added: “Much of the uncertainty we are seeing in this report is coming from a belief that unemployment will continue to rise in New Zealand this year, and this sentiment seems to be particularly impacting women, with 54% worried about their own job security. This could be a carry-over from Covid when we saw underutilisation rates disproportionately impacting women.”

About Ipsos

Ipsos is the third largest market research company in the world, present in 90 markets and employing more than 18,000 people. Our New Zealand operations include over 70 staff with offices in Auckland and Wellington. Our research professionals, analysts and scientists have built unique multi-specialist capabilities that provide powerful insights into the actions, opinions and motivations of citizens, consumers, patients, customers or employees. 

Our 75 business solutions are based on primary data coming from our surveys, social media monitoring, and qualitative or observational techniques. “Game Changers” – our tagline – summarises our ambition to help our 5,000 clients to navigate more easily our deeply changing world. Founded in France in 1975, Ipsos is listed on the Euronext Paris since July 1st, 1999. 

The company is part of the SBF 120 and the Mid-60 index and is eligible for the Deferred Settlement Service (SRD). ISIN code FR0000073298, Reuters ISOS.PA, Bloomberg IPS:FP https://www.ipsos.com/en-nz

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