AIDE MEMOIRE
Testing a government approach to workforce planning: sector case
studies
Date:
6 May 2026
Priority:
Medium
Security
In Confidence
Tracking
REQ-0030809
classification:
number:
Information for Minister(s)
Hon Louise Upston
Minister for Social Development and Employment
Contact for telephone discussion (if required)
Name
Position
Telephone
1st contact
Policy Director, Employment Skil s and
Simon Mandal-Johnson
✓
Immigration Policy
s 9(2)(a)
Senior Advisor, Skil s and Employment
Frances Aiken
04 897 6599
Policy
The following departments/agencies have been consulted
Ministry of Social Development, Ministry of Education, Tertiary Education Commission, Ministry
for Women, Te Puni Kōkiri and Ministry for Primary Industries.
Minister’s office to complete:
Approved
Declined
Noted
Needs change
Seen
Overtaken by Events
See Minister’s Notes
Withdrawn
Comments

AIDE MEMOIRE
Testing a government approach to workforce planning: sector case
studies
Date:
6 May 2026
Priority:
Medium
Security
In Confidence
Tracking
REQ-0030809
classification:
number:
Purpose
To provide background information on the sector case studies that informed our proposed
approach to workforce planning, to support discussions with your coalition partner about the
commitment to investigate the development of an essential worker workforce planning mechanism.

Simon Mandal-Johnson
Policy Director
Employment Skil s and Immigration Policy, MBIE
06/05/2026

REQ-0030809
In Confidence
2

We  have  investigated  an  enduring  government  approach  to  meeting
future skill needs in NZ
1.
In 2024, you commissioned us to “investigate the establishment of an ‘Essential Worker’
workforce planning mechanism to better plan for skil  or labour shortages in the long term”, a
commitment in the National/NZ First Coalition Agreement (the agreement).
2.
We used a ‘learning by doing’ approach, which included working with sectors to test aspects
of workforce planning interventions, a literature scan of best practices and analysing
workforce planning systems in other countries.
3.
On 31 March 2026, we proposed an enduring approach to workforce planning (the approach)
and a forward work programme that incorporates our conclusions from the investigation, and
which would be resourced from within existing baselines [REQ-0030065].
4.
We understand you plan to meet with your NZ First coalition partners to discuss the
investigation and confirm that the commitment in the agreement has been completed. To
support the discussion, this aide memoire provides a summary of our work to date with five
sectors (Annex One) and the key findings that informed the design of the approach.
We propose a workforce planning approach with three main outputs
5.
Our proposed approach to workforce planning [REQ-0030065 refers] focuses on three areas
where government can add most enduring value:
a.
Sector-led planning – we plan to support sector-led workforce planning to better
understand and address the drivers of their workforce issues. This could include
establishing a new connection to a sector looking to do longer-term workforce planning
or maturing the workforce planning capabilities of a sector with which we are already
working. We wil  also continue to investigate cross-sectoral workforce issues, such as
the labour market implications of Artificial Intelligence.
b.
System integration – we wil  investigate how government policy levers can be better
aligned and coordinated to facilitate sector-led workforce planning, strengthening the
connections between agencies that have an interest or a role in supporting sectors to
meet their skil s and workforce needs (ie education (including tertiary and vocational),
social development and immigration). This would include strengthening the
connections between the data sources that can inform workforce planning at the
regional level.
c.
Data and insights capability – we wil  undertake work to sustain a centralised source of
labour market data, insights and analytical tools, improving government’s labour market
forecasting capabilities and informing broader policy settings.
6.
We wil  turn these three things into reality by offering a consultancy model of support to
sectors who are leading workforce planning to meet their future skil s and workforce needs.
We wil  work with sectors and agencies to explore the underlying drivers of their skil s issues
and provide advice on how mixes of levers could be coordinated to target those drivers.
7.
The approach is designed to be tailored to the unique needs and characteristics of sectors,
including sectors where government is the main employer and has workforce planning
responsibilities, such as the health and education sectors. These agencies wil  continue to
lead workforce planning, supported by access to richer insights, improved forecasts and
better policy lever coordination.
REQ-0030809
In Confidence
3

8.
As this approach is well aligned with current work and resourcing allocation within MBIE and
  wider across public service agencies, the shift would not require new initiatives or groups to
be established, or additional funding to be sought in the immediate future.
This approach has been informed by “learning by doing” with sectors
9.
We tested aspects of workforce planning with different sectors to ensure the approach was
flexible to sector needs. These sectors were:
a.
construction and infrastructure
b.
horticulture
c.
tourism
d.
space and advanced aviation
e.
energy.
10.  We engaged with each sector to understand the issues faced, workforce chal enges and
where there were opportunities for government action. We worked with a range of
government agencies with skills and employment levers and/or sector-specific interests to
understand what support for workforce planning was already happening across government
and make recommendations for how levers could be coordinated to respond to workforce
issues. This work is summarised in Annex One.
11.  Our work with sectors demonstrates three ways which MBIE (with other labour market
agencies and relevant sector agencies) could add the most value:
a.
Providing tailored support for industry-led workforce planning – Sectors have varied
capacity to engage in workforce planning. An industry-led approach would strengthen
their sense of ownership and commitment to delivery; tailored government support
allows resources to be targeted to where they can have the most impact (eg sectors
with high growth potential but low workforce planning maturity).
b.
Improving access to high‑quality data, analytical capability, and supporting
infrastructure – data capability is uneven across and within sectors, with government
often holding more comprehensive workforce data. MBIE can play a critical enabling
role by providing data, forward-looking insights, and analytical support, particularly
where sector capability is limited or emerging.
c.
Strengthening connections with system actors – Improved system connections would
close existing data and analytical capability gaps, so workforce insights and analytical
expertise can be shared and used more consistently across government and sectors
and enable better coordination of levers to target underlying drivers of workforce
issues.
12.  Our research into best practice workforce planning and overseas models supports this
conclusion. A recent legislative review of Jobs and Skil s Australia (JSA), the independent,
source of labour-market and skills advice at the centre of the Australian workforce planning
system, indicated that the JSA’s effectiveness in supporting medium- and long-term shifts in
how workforce issues are addressed lies in the quality of its analysis, reporting and advice,
and its ability to develop enduring and trusted relationships across the skil s system.

REQ-0030809
In Confidence
4

Annex One: Case study summaries

Sector
Methodology
Insights
Construction
and
The Ministry of Business, Innovation and
•  Capability to access and analyse
infrastructure  Employment (MBIE) analyzed available data on
workforce data into useful insights
workforce demand and supply and then
is variable across and within
consulted peak bodies and major employers to
sectors; agencies are likely to hold
identify workforce issues and understand the
more workforce data than many
underlying drivers of those issues.
sectors themselves.
We worked with other government agencies to
•  Maintaining the necessary
identify government levers (immigration,
infrastructure, data pipelines and
education and training, social development) with
analytical capability important for
the potential to address these issues. We tested
the broader workforce planning
our proposals with industry and produced a final
system.
report with recommendations for the Labour
Market Ministers Group.
•  Without its own levers, any
workforce planning mechanism
Of the seven report recommendations, three
would operate in an advisory
were adopted (relating to the Accredited
capacity, and its influence would be
Employer Work Visa and the design of the
limited by stakeholder willingness
Industry Skil s Boards). Two recommendations
to act on advice.
(leadership training and pastoral care) were
agreed in principle by the Minister for Social
Development and Employment, to be
reconsidered when funding was available. Two
recommendations, relating to establishing a
representative industry body and proposing
changes to immigration settings, were not
adopted.
Horticulture

MBIE worked with the Ministry for Primary
•  Levers are more effective when
Industries to explore options for a workforce
they target the underlying drivers of
planning ‘prototype’.
workforce issues, rather than
addressing only their surface‑level
Initial findings indicated current workforce issues
impacts on sectors.
would be more appropriately responded to by
sector levers, with little role for government
•  Setting clear expectations upfront
levers. Given the low added value of continued
about roles and responsibilities,
engagement with MBIE in these circumstances,
scope, and the resources to be
we shifted our focus to identifying a new target
contributed by both government
sector for engagement.
and the sector would help test
sectors’ wil ingness to act and
surface potential roadblocks early.
Tourism

MBIE undertook analysis of workforce issues in
•  Employment portfolio officials can
the Tourism sector for the Minister of Tourism
play a valuable role supporting
and Hospitality.
sector portfolio officials with
workforce planning – eg providing
We provided workforce data and analysis to
expertise, insights and analysis,
Tourism and Hospitality portfolio officials to
and advice on government levers
support their work. We supported portfolio
and how they influence labour
officials to develop recommendations in
supply and demand.
response to a workforce report produced by
sector bodies and Ringa Hora.
REQ-0030809
In Confidence
5

Space and

Adva
  nced
Initial scoping explored key workforce issues
•  New and emerging sectors often
Aviation
and their underlying drivers. We assessed that
have both high growth potential
the sector would need to mature its workforce
and low maturity. It is difficult to
planning, and that this would be effectively
balance the growth opportunity
achieved by sector levers.
against the risk that low maturity
will reduce their capacity to engage
As a result, work focused on connecting the
in workforce planning at the point
sector with sources of support, including
of sector selection.
assistance to establish a national body and to
help it develop a clearer, shared understanding
•  Reinforces that a broad range of
of workforce composition and key workforce
levers could be selected from and
chal enges across the sector.
used to address the underlying
drivers of workforce issues,
Targeted, ad hoc work is continuing with this
including sector levers.
sector.

Energy

MBIE worked with Energy Resources Aotearoa
•  Reinforces that influence relies on
and the Electricity Engineers’ Association as
stakeholder commitment to act on
they developed the Re-Energise workforce
advice – supporting industry to lead
report (the report). A memorandum of
workforce planning fosters their
understanding set out the working relationship
sense of ownership of the plan and
and tasks to be completed by government
commitment to delivering its
agencies. This included providing data and
actions.
analysis for the report as well as meeting to
identify emerging issues to develop a clear

rationale for government intervention, if needed.
Over time, the relationship evolved to reflect the
sector’s preference for greater ownership of
action development, with government shifting
into a ‘critical friend’ role to sense-check
proposals.
Following the release of the report and the
conclusion of the formal working relationship, we
coordinated a cross-agency response to its
recommended actions, including seeking
agreement to commit to further work
[REQ-0030147].

REQ-0030809
In Confidence
6

BRIEFING
Labour market impacts of artificial intelligence
Date:
20 May 2026
Priority:
Medium
Security
In Confidence
Tracking
BRIEFING-REQ-0033058
classification:
number:
Action sought
Action sought
Deadline
Hon Louise Upston
Agree for MBIE to forward this paper  20 May 2026
Minister of Social Development  discussion at the Labour Market
and Employment
Ministers’ Group meeting on 27 May
2026
Contact for telephone discussion (if required)
Name
Position
Telephone
1st contact
Policy Director,
Simon Mandal-
Employment, Skills and
[04 000 0000]  s 9(2)(a)

Johnson
Immigration Policy, MBIE
Senior Policy Advisor,
Labour Market
Stuart King
04 901 3837
Performance & Policy,
s 9(2)(a)
MBIE
The following departments/agencies have been consulted
Government Digital Delivery Agency, BusinessNZ, New Zealand Council of Trade Unions
Minister’s office to complete:
Approved
Declined
Noted
Needs change
Seen
Overtaken by Events
See Minister’s Notes
Withdrawn
Comments

BRIEFING
Labour market impacts of artificial intelligence
Date:
20 May 2026
Priority:
Medium
Security
In Confidence
Tracking
BRIEFING-REQ-0033058
classification:
number:
Purpose and key messages
This paper responds to LMMG’s request to identify the challenges and opportunities for labour
market policies and settings created by artificial intelligence.
Current evidence suggests that AI creates more opportunities for the labour market than risks. We
view scenarios of rapid displacement and mass unemployment as unlikely at present. MBIE will
continue to manage risks through monitoring of early-warning indicators of AI acceleration and
disruption, improving our data sources (especially around job ads), and integrating AI into our
efforts to improve employment forecasting.
Initial analysis suggests over one-third of occupations could be augmented by current AI
technology, potentially lifting productivity and economic growth. The Survey of Business
Operations- currently in the field- will give us greater clarity around the extent of current AI uptake,
and where the barriers for uptake are. We recommend reporting back to LMMG after the survey
results are released in September with options for lifting AI application and use through labour
market mechanisms.
Recommended action
The Ministry of Business, Innovation and Employment recommends that you:
a
Agree that MBIE forwards this paper for discussion at the Labour Market Ministers’ Group
meeting on 27 May 2026.
Agree / Disagree

b
Note that the Survey of Business Operations (SOBO) will provide further evidence around AI
uptake, and barriers to business use of AI, when results become available at the end of
September.
Noted

c
Note that risks of significant job displacement from AI are low at this stage. MBIE will
continue to monitor media reports and high-frequency indicators (through the six-monthly AI
Dashboard) to advise you if there is any reason to adjust this assessment.
Noted

d
Note interim MBIE analysis suggests over a third of occupations could potentially be
augmented by AI to lift productivity, and most of those occupations are in professional
services and/or at management level.
Noted

BRIEFING-REQ-0033058
In Confidence
1

e
Note that identifying the changing skill needs created by AI will be taken into consideration
by MBIE in our work on developing improved employment forecasting, and better job ads
data (alongside other policy needs). This work will support improved workforce planning and
can inform improved careers advice and linkages between education and training and
employment outcomes.
Noted

f
Agree that MBIE report back to LMMG in October, following the release of SOBO data, with
advice around the extent to which skill gaps are a barrier for augmentation of occupations,
the nature of those skill gaps, and options for addressing those gaps.
Agree / Disagree

Simon Mandal-Johnson
Hon Louise Upston
Policy Director
Minister of Social Development and
Employment, Skills and Immigration Group,
Employment
MBIE

14 / 05 / 2026
..... / ...... / ......

BRIEFING-REQ-0033058
In Confidence
2

Background
1.
The Labour Market Ministers Group (LMMG) have requested advice on the specific
opportunities and challenges created by artificial intelligence (AI) for New Zealand’s labour
market policies and settings.
2.
This paper outlines the evidence to date on how AI has been affecting New Zealand’s labour
markets, how things may play out in the future, and your options to promote greater
productivity and economic growth through AI uptake.
Sources of data
3.
Previous advice presented to the LMMG focused on economic theory and global trends to
indicate the potential impacts of AI.
4.
This paper builds on that work through the application of Jobs and Skills Australia’s
assessment of occupational exposure to a New Zealand context. The Australian analysis
looks at the range of tasks that make up each occupation, and assigns that task a rating in
terms of potential for automation (i.e. AI is able to replace human labour) and augmentation
(i.e. AI is able to supplement human labour to improve the quantity and/or quality of outputs).
5.
We have applied these scores to New Zealand’s occupation mix, under the assumption that
the same occupations in both countries should be broadly similar in terms of its task make-
up.
6.
While this is interim analysis, the results of this work are similar to previous reports on AI
exposure we have reported to you: the range of occupations at risk of automation are very
low (around 2 per cent of all occupations), while opportunities for augmentation are high (with
over one-third of New Zealand occupations having high exposure to augmentation).
7.
Our analysis has been further supplemented with:
a.
engagement with key stakeholders (such as the Government Digital Delivery Agency,
Business NZ, New Zealand Council of Trade Unions, and contacts in university career
offices).
b.
additional evidence from overseas, including analysis of the impacts of AI on graduate
recruitment and hiring.
8.
We expect more detailed information on this topic to come from MBIE’s Survey of Business
Operations (SOBO) which is currently in the field with 20,000 New Zealand businesses.
Among other insights, this will provide a strong baseline of the extent of AI uptake; barriers to
uptake; the extent to which AI augments or automates tasks; impacts of AI on employment
levels, skill demands, productivity, and quality of work; and how businesses are training and
finding staff with required skills.
9.
Results from SOBO will become available in late September.
Key findings
The overall pace and scale of change is curently manageable within existing settings
10.  The pace and scale of change brought about by AI appears in line with similar general-
purpose technologies (such as personal computing and the internet). There is no evidence of
a reduction in aggregate employment attributable to AI in New Zealand or overseas. This
finding is unchanged from previous papers to Ministers.
11.  If the diffusion and application of AI into the workplace continues at this pace, we expect our
existing labour market settings and institutions can absorb the aggregate impacts of this

BRIEFING-REQ-0033058
In Confidence
3

adjustment. New Zealand has a flexible and dynamic labour market that has coped well with
large-scale shifts in demand in the past. In a typical year, new and disappearing jobs account
for around 13-15% of all jobs in New Zealand, and every year around one-fifth of New
Zealand workers change jobs, and 2.5% retire.1 Scenarios of AI leading to rapid
displacement and mass unemployment appear unlikely at this stage.
12.  Based on a preliminary assessment by officials, only around 2 per cent of New Zealand
workers are in occupations where most of their tasks could currently be automated by AI at
its current level of capabilities. These occupations are mostly software programmers and
other ICT professionals, accountants and call centre operators.
13.  While unlikely at this stage, there is a risk that AI application in the workplace may accelerate
beyond our current expectations, or additional technological advancements could impact a
wider range of jobs. To manage this risk, we will continue MBIE’s six-monthly AI Dashboard
and monthly media monitoring programme. This requires limited resources to manage and
will identify early warning signs of significant labour market disruptions potentially attributable
to AI (either in New Zealand or overseas). We expect any acceleration of AI disruption to
become noticeable overseas first, in countries with more advanced rates of uptake.
Opportunities to increase productivity through augmentation of roles exist, but require a deliberate
approach
14.  The table below summarises our initial work on AI exposure in a New Zealand context,
applying the analysis from Jobs and Skills Australia. High exposure to automation implies
that an occupation has many tasks where current AI technology could replace human labour,
high exposure to augmentation implies there are many tasks where AI can supplement
human labour.
Table 1 Proportion of New Zealand occupations by exposure to AI

Low and very
Medium
High
TOTAL
low automation
automation
automation
Low and very
10%
0%
0%
10%
low
augmentation
Medium
48%
3%
1%
52%
augmentation
High
23%
13%
1%
37%
augmentation
TOTAL
81%
16%
2%

15.  As noted above, there are only a small number of occupations (2 per cent) with high
exposure to automation risk.
16.  There is a fairly large proportion of occupations (60 per cent) with low to medium exposure to
automation and low to medium exposure to augmentation. These occupations are likely to
experience minimal impacts from current AI technologies.
17.  Around 36 per cent of occupations have high potential for augmentation, with low to medium
risk of automation. The largest occupational groupings here are managers and higher-skilled
knowledge workers. This represents our opportunity space: the occupations where efforts to
increase AI uptake to boost productivity are likely to have the most impact.

1 New Zealand Productivity Commission (2020) Final Report: Technological Change and the Future of Work
Technological change and the future of work

BRIEFING-REQ-0033058
In Confidence
4

18.  This assessment of occupational exposure only identifies the potential for change within
occupation, assuming current technologies are implemented in full to their peak potential.
  The actual rate of augmentation will depend on the ability of firms and workers to adapt and
use the technology in their workplaces.
19.  Historically, New Zealand has seen relatively slow diffusion of new technologies into firms-
without an active approach, there is a risk that the full potential of AI to lift productivity may
be missed.
20.  While international research and stakeholder engagement points to the value of ‘soft’ skills in
supporting AI augmentation, there is limited information about where skill gaps are holding
back AI uptake, and what specific skills employers are looking for. The results of SOBO will
give us a stronger baseline for understanding these barriers, and how to address them.
21.  We recommend building on the results of SOBO and our engagement with industry to
identify interventions that can promote greater augmentation and increased capability. If
agreed, we will report back on this work in October, following the SOBO release.
There is a risk of AI reducing early-career opportunities, but the evidence is unclear
22.  As part of this analysis, we have also examined the specific risk of AI to recent graduates.
Evidence from the United States and United Kingdom has suggested a reduction in entry-
level/recent graduate opportunities in certain professional sectors (IT, law, accounting,
finance) in recent years. The evidence from this research is more mixed on the extent to
which this slowdown can be attributable to artificial intelligence rather than general economic
conditions. Aggregate graduate hiring (across all sectors) appears stable.
23.  Other data (from a range of jurisdictions including Australia, the European Union, the United
Kingdom, United States, Singapore and Japan) has not indicated any significant reduction in
total hiring of recent graduates.
24.  New Zealand universities have not reported strong evidence of a reduction in graduate
recruitment activity on campus (beyond that attributable to the economic cycle). They do
report a general shift in employers’ expectations for graduates, with a greater emphasis on
skills that augment AI technology- such as communication, teamwork, literacy, adaptability
and self-management.
25.  Other New Zealand evidence (from media monitoring and engagement with unions and
technology associations) have reported reduced hiring of graduates in IT and finance,
although the drivers of this change cannot be pinned down.
26.  Overall, while the evidence of current AI impacts on graduate hiring is mixed, there is a risk
of a growing disconnect if employer skill demands shift faster than the education and training
system. Ongoing improvements to our data collection (outlined below) will help with our
monitoring of this situation.
27.  To manage this risk, we will integrate consideration of AI, alongside other megatrends, into
MBIE’s employment forecasting work. This will improve the accuracy and usefulness of
forecasting for identifying future skill needs, and providing advice on education, training and
immigration settings.
Our understanding of AI impacts in New Zealand is limited by data
28.  The evidence base to understand AI impacts is limited, although we expect it to improve
once the results of SOBO are available.
29.  Much of the overseas analysis of impact of AI on graduate outcomes has relied on job
postings data. MBIE’s Jobs Online is unable to replicate this level of granularity at present.

BRIEFING-REQ-0033058
In Confidence
5

30.  Improvements to New Zealand’s job postings and vacancy data will allow better assessment
of shifting skill needs, and will have applications beyond AI. We are currently working
  towards options to improve our vacancy data as part of a broader approach to employment
forecasting and workforce planning, and consideration of AI policy will be part of this.
Next steps
31.  This evidence suggests that the aggregate impact of AI is manageable within existing
settings, and there is not a strong case to develop reactive policy options to deal with mass
labour market disruption. There is however a case for continuing our monitoring programme
and better integrating the impacts of megatrends such as AI into our forecasting work, to
provide better support to the education and training and immigration systems.
32.  The key opportunity is to seek increased augmentation of occupations through AI, lifting
productivity. Evidence from SOBO will allow us to report on barriers for New Zealand firms in
using AI. If agreed, we will report back to LMMG in October on barriers to AI uptake, the
skills needed to increase AI uptake and use, and options to increase business access to
those skills.

BRIEFING-REQ-0033058
In Confidence
6

MEMO
DATE
20 May 2026
TO
Labour Market Ministers Group
PREPARED BY
s 9(2)(a)
, Principal Advisor, Skills and Employment Policy
Stuart King, Senior Advisor, Labour Market Policy and Performance
APPROVED BY
Hilary Pearse, Acting Manager, Skills and Employment Policy
SUBJECT
Government support for young people not in employment, education or training
(NEET) in the context of rising NEET rates
TRACKER
REQ-0032810
Recommendations
MBIE recommends that you:
a.  s 9(2)(g)(i)



b.  Note the planned further analysis of the drivers of the NEET rate increase to be included in the
Employment Key Messages on 28 May 2026.
Noted
c.  Note the work programme under way to support young people at risk of long-term or persistent
limited employment, including a review of Youth Guarantee.
Noted
d.  s 9(2)(f)(iv)

PURPOSE
To inform the Labour Market Ministers Group (LMMG) of the latest NEET rate increase in the Household
Labour Force Survey (HLFS) and the potential for further increases due to fuel price rises. The paper also
proposes further work to explore whether current interventions are equipped for future NEET increases
and investigate possible interventions in the near term.
NEET RATES HAVE BEEN RISING SINCE 2023 AND THIS CONTINUED IN THE MARCH 2026 HLFS
In the March 2026 HLFS, the NEET rate for 15–24-year-olds rose to 14.4 per cent. This is the highest rate
since December 2009, when the rate was 15.5 per cent (seasonal y adjusted).

2
While this is only one quarter’s result, there has been a general upwards trend in the NEET rate starting in
2023.
   The March 2026 results do not reflect the impacts of the fuel crisis, so there is a risk of further rises in
NEET rates over the year for young people who tend to be more affected by economic downturns (more
detail is included in the paper: Summarising the labour market implications of recent fuel price rises [REQ-
0032683]).
There are a couple of points of note in the underlying data:
•  There appears to be a regional component to the growth of NEET rates, especially in Auckland.
Looking at March years, Auckland has seen its NEET rate rise from 11.1 per cent in 2023 to an all-
time high of 15.3 per cent in 2026. The rest of the country saw a more modest rise from 11.3 per
cent to 12.7 per cent, which is close to pre-COVID levels (not seasonally adjusted).
•  Unemployment appears to have been a significant contributor to the increase in NEET rates since it
began picking up in 2023. This suggests that the increase in NEET rates is made up of people who
want to work and are actively seeking a job, rather than those who have become discouraged and
dropped out of the labour force. Despite the driver behind recent increases being in
unemployment, there continue to be more young people who are NEET that are not in the labour
force.

THERE CAN BE SIGNIFICANT CONSEQUENCES OF BEING NEET LONG-TERM
While many young people experience short-term periods of NEET as they shift quickly between jobs, or
between work and study to pursue new opportunities, if a young person is looking and unable to find stable
employment over a long period of time, there can be significant long-term consequences. These young
people may experience very high levels of limited employment, characterised by:
•  long or frequent periods of benefit dependency, unemployment, or under- employment
•  being trapped in low wage, low skill, or insecure work and/or
•  continual enrolment in low-level foundation tertiary education1.

1 Preparing al  young people for satisfying and rewarding working lives: Long-term Insights Briefing (2023)
MBIE Memo: Government support for young people not in employment, education or training (NEET) in the context of rising NEET
rates  REQ-0032810

3
THERE IS PORTFOLIO OF ACTIVE LABOUR MARKET PROGRAMMES CURRENTLY AVAILABLE
The  Government has a significant portfolio of programmes which support people into employment,
education or training. Key interventions span programmes with a preventative focus before young people
are working age, programmes with an education and training focus with linkages to employment, and
active labour market programmes (ALMPs). Annex One provides a map of the education to employment
transition interventions. Annex Two outlines the work underway to support young people, as well as key
interventions and relevant government work programmes.
MSD’s snapshot of ALMPs for LMMG in April 2025 included 53 ALMPs in the Financial Year 2024 with
430,000 participants2 who started an ALMP, at a cost of around $1 bil ion. These programmes range from
job creation and financial support to job brokerage, pastoral care, work-related education and training, and
information and advice. 81 per cent of the funding was ongoing with the remainder already or due to end
before the end of the 2025 calendar year. The funding due to end was mostly work-related education and
training programmes.
Of MSD programmes evaluated through the Employment Assistance Catalogue, over 90 per cent are rated
as effective or promising. Young people have access to this suite of ALMPs, with some being specifically
designed for young people. In addition, there are a range of other interventions that specifically support
young people before they are working age or are at risk of limited employment. Note that young people
applying for these supports will need to meet each programme’s eligibility criteria. Some supports may also
either be entirely or partially targeted towards benefit recipients.
FURTHER WORK HAS BEEN UNDERWAY TO IMPROVE OUTCOMES FOR YOUNG PEOPLE
At the July 2025 LMMG meeting, Ministers sought advice on how to better support young people
transitioning from education to employment. Labour Market Ministers considered this advice at their
October 2025 meeting, which included work on ALMPs, an employability skills initiative for young people
aged 12+ and a review of Youth Guarantee [MBIE REQ-0021152, REQ-0020689]. Papers for this LMMG
meeting discuss both the employability skills initiative and the Youth Guarantee review.
WE RECOMMEND ASSESSING WHETHER ANY CHANGES TO NEET SUPPORT WOULD BE REQUIRED TO
ADDRESS FURTHER NEET RATE INCREASES AND IDENTIFYING POSSIBLE NEAR-TERM INTERVENTIONS

In light of the March 2026 NEET rate being at its highest point since December 2009 and the headwinds
from the rising fuel prices, it is prudent to reassess whether any changes may be needed to the system of
support for young people who are NEET and whether more is needed. s 9(2)(f)(iv)

We note that the next phase of the Youth Guarantee review could include investigating programme design
changes to strengthen connections to employment and develop employability skil s to support labour
market transitions. s 9(2)(f)(iv)

2 Note that if a person participates more than once in a financial year, they wil  be counted each time (therefore this
value is not a count of unique participants)
MBIE Memo: Government support for young people not in employment, education or training (NEET) in the context of rising NEET
rates  REQ-0032810

4
NEXT STEPS

Officials will provide further analysis of the drivers of the NEET rate increase with historical and
international comparisons through the Employment Key Messages on 28 May 2026.

s 9(2)(f)(iv)

MBIE Memo: Government support for young people not in employment, education or training (NEET) in the context of rising NEET
rates REQ-0032810

5
ANNEX ONE: MAP OF EDUCATION TO EMPLOYMENT TRANSITION

MBIE Memo: Government support for young people not in employment, education or training (NEET) in the context of rising NEET
rates REQ-0032810

IN-CONFIDENCE
Annex One: Map of the education to employment transition (as at September 2025)
Year 9
Year 10
Year 11 / L1
Year 12 / L2
Year 13 / L3
Working age adults
Age
13
14
15
16
17
18
19
20
21
22
23
24
Careers support is available through a variety of avenues for those in school, in tertiary study, or of working age (eg Tahatū Career Navigator, Inspiring the Future, and Direct Careers Service)
The primary and secondary education system
• Each year, approximately 55 per cent of school leavers move onto tertiary study
•
The schooling system includes a diverse range of careers services and support for students to transition
• A further 28 per cent of school leavers go into work.
out of schooling and into work or further study.
The tertiary education system
•
Each year, approximately 60,000 students leave the secondary school system, 84 per cent of whom
achieve NCEA Level Two or above.
•
The tertiary education system includes degree level study, vocational education
•
The Minister of Education is currently consulting on a proposal to replace NCEA.
and training, and foundation education.
•
Work is underway to implement the redesign of the Vocational Education and
Trades and Services Academies
Training system from 1 January 2026.
•
The draft Tertiary Education Strategy sets the long-term strategic direction for
Gateway
tertiary education and is currently out for consultation with agencies.
Māori and Pasifika Trades Training
• Approximately 24,000 school leavers (of 60,000 total) leave at
years 11 or 12.
Youth Guarantee Fund / DQ1 and 2 funding
• The main activity for between 15 and 17 per cent (~10,000) of
all school leavers in the year after they leave school is not being
• A cohort study in 2015 identified that there were 134,000 young people (16–24) in limited employment. Of those, 26,000
in employment, education or training.
(19 per cent) were in limited employment in every year between the age of 16 to 24.
Youth Services
Youth Employment Pathways / He Poutama Rangatahi and He Poutama Taitamariki
The main benefit system
• MSD provides employment services that include case management and other interventions
to support people to enter employment or become work ready.
Prior to the transition from education to employment there is a range of
• As of April 2026, around 47,200 people aged 18-24 received the Jobseeker Support benefit.
supports in place to improve outcomes. This includes learning support,
Around 1,300 working age young people received the Youth or Youth Parent Payment.
alternative education pathways, attendance services and youth
Welfare that Works: community job coaching
development programmes.
Mayors Taskforce for Jobs and CadetMax
Youth Individual Placement and Support (trials)
Limited Service Volunteers

6
ANNEX TWO: RELATED WORK ON THE LMMG WORK PROGRAMME, MAPPED TO MANDY McGIRR’S
EMPLO

YABILITY FRAMEWORK

MBIE Memo: Government support for young people not in employment, education or training (NEET) in the context of rising NEET
rates REQ-0032810

IN-CONFIDENCE
Annex Two: Key existing initiatives and work currently underway to support transitions between and within education, training and employment (data as at Sep 2025)
Schooling System
Tertiary Education
Main Benefit System
(key teaching & learning funds)
Careers Information Grant
Māori and Pasifika Trades Training
He Poutama Rangatahi
Changes to senior secondary qualifications
• Operational funding to support structured career learning
• Fees-free pre-trades training to progress to relevant trades
• A work-readiness and skil s initiative for young people who
• School age population, includes vocational education in
for Years 9-13
or trades-related employment or further training (including
are hard to reach and most at risk of long-term
schools.
apprenticeships).
unemployment.
• Young people (16-19 years)
• Decisions announced May 2026.
• Young people and adults (16-40 years).
• NEETs.
• Not tracked — monitoring would be resource-intensive and
• 2,788 places (2023/24).
• 2,354 participant starts in 2023/24. $36 mil ion in FY24.
there’s no existing system
s 9(2)(f)(iv)
• Approx $10 mil ion al ocated in 2024.
• Rated as Effective.
• $7.105 mil ion (2025)
• 2017 evaluation found MPTT achieves good outcomes, and
• No information available on effectiveness.
is seen as a positive initiative with strong sector support.
He Poutama Taitamariki
Tahatū Career Navigator
• A wrap-around case management service for all young
• The New Careers Planning website connecting 100 school
Youth Guarantee Fund
people (15 to 24) receiving a main benefit.
subjects, 4,000 qualification and 800 career ideas.
National Career System Strategy
• Fees-free foundation-level tertiary study.
• NEETs in Northland.
• Young people (13-19 years), expanding to all NZers
• School age population supporting pathways.
• Young people (16-24 years) with low or no prior quals.
• 2,182 in 2023/24. $2.9 mil ion in FY24.
• 102,000 current users (May 1-Sep 11)
• Progress ongoing.
• Approximately 8,250 people (2024).
• Not yet rated.
• Recently launched into secondary schools.
• $95.2 mil ion al ocated in 2024.
• Has a significant positive impact on learners during their
Secondary-Tertiary Education
engagement in the programme, but limited long-term
Welfare that Works: Community coaching
Inspiring the Future
effectiveness.
• Delivers tailored support to young people who have been
• Young people hear from volunteer role models in their
on the Jobseeker Benefit for 3 months or longer, by
communities, learn about different jobs, career pathways
Trades Academies
addressing their barriers to employment.
Apprenticeship Boost Initiative
and challenges they faced.
• 18-24 year olds who have been on the Jobseeker benefit for
• Equips young people with the relevant vocational skills for
• MSD-administered payment to employers to help them
• Primary school and young people (13-19 years).
more than 3 months.
work
keep and take on  new apprentices.
• 12,000 plus students annual y, 1,200 role models from
• Up to 7,500 participants. $9.45 mil ion al ocated.
• Young People (usually in Year 12)
• Young people and adult apprentices.
across business and industry.
• Not yet rated.
• Typically between 10,500-11,500 enrolments.
• 27,879 apprentices went through the ABI validation
• The only free role model event open to all students aimed
Approximately 400 schools from around the country
between May 2024 and May 2025.
s 9(2)(f)(iv)
at broadening horizons and chal enging stereotypes.
participate across the 24 programmes.
• $139.6 mil ion al ocated in 2024/25.
Rangatahi Futures
• Recent review show positive impact on school achievement
Broader investment in tertiary education
• Approximately $3.229 billion in funding for tertiary tuition
• An updated quality career resources for use in schools and
and post school pathways.
and training subsidies – this includes foundation education
community based in te ao Māori and the Māori economy.
and equity funding
• Rangatahi Māori in secondary school and community, but
Gateway
• Approximately $322 mil ion of the total $3.229 bil ion is
relevant to al  students.
• Funding enables secondary schools to give senior students
funding for adult and community education, literacy,
• Refresh and piloting underway.
access to structured workplace learning integrated with
numeracy and English language provision, and other
• Ensures culturally relevant career resources, aligned with
school-based learning.
foundation education programmes
Active Labour Market Programmes
Tahatū, to target disengagement with traditional career
• Young people (16-19 years).
tools and improve outcomes.
There are 80+ active labour market programmes  totalling
• 15,455 students took part in workplace learning in 380
approx. $900 million per year across government that support
VET Redesign
schools in 2024.
people on benefit to prepare for, get and keep a job. While
Reducing persistent disadvantage
• $23.3 mil ion al ocated in 2024/25.
• Not age/population specific, although supports post-
some are specifically targeted to youth, most are age-agnostic
secondary school pathways
• Focus on younger cohort transitioning into secondary
• Recent review show positive impact on school achievement
and support a range of ages and needs. Of MSD programmes
• Implementation underway
school (12+) with complex needs.
and post school pathways.
evaluated through the Employment Assistance Catalogue, over
• s 9(2)(f)(iv)
90 per cent are rated as effective or promising.
Review of work-related training ALMPs
KEY: Work is currently underway on initiatives with a red
• Not age/population specific (focus on benefit population).
border.
• Advice considered October 2025.

Document Outline