TUESDAY, OCTOBER 13, 2026|No. 18530
New Zealand · Economy

New Zealand Businesses Grapple with Declining Birthrate and Shrinking Workforce

New Zealand's businesses are facing a growing challenge as a declining birthrate and low natural population increase point towards a future scarcity of labor, making traditional growth strategies unsustainable.

A cityscape of Auckland, New Zealand, representing the nation's economic landscape.
A cityscape of Auckland, New Zealand, representing the nation's economic landscape.
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New Zealand’s birthrate statistics continue to decline.

According to the latest national population estimates from Stats NZ, the estimated natural increase (births minus deaths) was 18,700 for the year ending June 2026. Births in the June 2026 year have also fallen to their lowest point since 2003.

These combined trends have reduced the natural increase to its lowest level since the early 1940s, during World War II.

Infometrics principal economist and lead demographer Nick Brunsdon told The Front Page that preparations for the future should begin now.

“The falling birth rate that we saw technically isn’t a problem for the economy until in 18 years’ time when these young people become adults and don’t enter the workforce.

“We kind of need to be doing as much as we can now to get ready. That’s things like trying to help our young people as much as we can.

“We have 13% of youth not engaging in training or education, and we should be throwing a lot of resources to handhold them or whatever they need to get them in.

“It’s those sorts of things as well as in business, thinking about productivity. When we get to that point in 18 years, but I think also probably a little bit sooner, we’re going to find that we can’t just hire more people when we have a problem or when our business grows.

“We’re just not going to have those resources around. So it’ll be about shifting our mindset to realise that people are actually quite a scarce resource,” he said.

Brunsdon stated that migration is not a viable solution, as many other countries face similar demographic challenges.

“If we wanted to completely work our way out of the problem, we would need to have an ever-increasing amount of migration every single year, basically from now until forever, which is not realistic.

“Australia, the UK, perhaps all of the developed world is facing the same challenge as us. So they’re going to be really wanting to hold on to the young people more so than they have in the past.

“Even developing countries are facing slowdowns in their population as they go through the same change. China’s population has been in decline for four years. They used to be one of the largest sources of migrants for New Zealand.

“That supply of young keen migrants is not going to be as unlimited as it has been in the past, and it’s just because the supply isn’t there, the competition for that supply is higher and I think the idea that we can just get more and more people in every year is not realistic either,” he said.

Listen to the full episode to hear more about:

  • Workforce implications
  • A shift in focus
  • Migration won’t solve it
  • Role of AI.

The Front Page is a daily news podcast from the New Zealand Herald , available to listen to every weekday from 5pm. The podcast is presented by Chelsea Daniels, an Auckland-based journalist with a background in world news and crime/justice reporting who joined NZME in 2016.

You can follow the podcast at iHeartRadio , Apple Podcasts , Spotify or wherever you get your podcasts.

PAN's pipeline reviewed approximately 1 open sources for this article. No human editor reviewed this article before publication.

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