For younger people with fewer responsibilities, there may be more options: travel or return to training.
But it can still deliver a deep blow to a person’s self-esteem and confidence.
When we crunch the topline numbers on job losses it is inevitably dehumanising.
So let’s dig into them a bit.
Last week we learned the unemployment rate rose to 5.1%. That’s still below the long-run average across the modern history of the Stats NZ labour market data (it dates back to 1986).
It also landed in line with Reserve Bank forecasts – so far so good.
If it peaks at 5.4%, as currently expected, it is unlikely to be one of the statistics that troubles economists and commentators over the coming year.
It certainly won’t generate the kind of public outcry we got as inflation rose in 2022 and 2023.
In fact, despite being back inside the Reserve Bank’s target band at 2.2%, the price of groceries still seems to dominate the public’s list of economic concerns.
But when we look at actual numbers rather than percentages, the real cost starts to come into view.
Unemployment rose by 33,000 in 2024 to 156,000.
That only counts people who are actively looking for work and it doesn’t count anyone working part-time – even though they may be desperate for fulltime work.
Economists have highlighted the extent to which a falling participation rate has flattered the unemployment rate.
In other words, the record numbers of Kiwis leaving the country and a big increase in people heading back to study and re-train have limited the damage.
One would assume that is particularly the case for young people.
Yet, as highlighted by ASB senior economist Mark Smith, the rate of unemployment for youth aged 15-19 has hit 23%.
The age group lost a net 17,000 jobs over 2024, more than half of the total jobs lost, Smith said.
Stats NZ data last week also highlighted that males were bearing the brunt of the job losses – with construction and manufacturing hit hard.
The unemployment rate for males aged 15-19 was 24.6%.
You might argue the sample size is getting pretty small at this point, but Stats NZ figures show a total of 21,700 teenage males are unemployed.
Bear in mind these are those not in training or part-time work.
That, frankly, is a large and growing pool of disaffected young men available for recruitment into gangs or otherwise being lost to the system.
If we break the numbers down by ethnic group, the disparity in the unemployment numbers is even more stark.
The overall unemployment rate for Māori was 9.7% (the rate for Europeans is just 3.9%).
The rate for Māori males is 13.8%. The rate for Māori youth (aged 15-24) is 19%.
When it comes to youth rates, other ethnic groups are also disproportionately affected.
The rate for Pacific youth (15-24) is 24%, Asian is 17% and even European is 12%.
In some respects, this isn’t really news because these same patterns repeat every time the country goes through a recession.
But I think they should be highlighted because they go to the root of so many more social problems that blight the whole country.
When unemployment rises, the burden falls on the young - young men particularly and even more so on young Māori and Pacific men.
There is data that shows how inflation is also more painful for some groups than others.
Stats NZ’s Household Living Costs index shows that the poorest and those on fixed incomes were hit harder by real inflation in 2024.
For beneficiaries, it was 3.3%, while for Māori it was 3.1% and for superannuitants, it was 3.6%.
For the wealthiest household group, inflation was just 2.7% and for the poorest, it was 3.9%.
These are also tough numbers. When you are poor and have less disposable income then a rise in the cost of groceries and rent is disproportionately rough.
Clearly the answer to rising unemployment isn’t for the Reserve Bank to take a softer stance on inflation.
I’m also suspicious of the idea that the answer is to get tougher on beneficiaries.
The idea that the most vulnerable youth just need to put on a smart shirt, polish up their CV and get off the couch is simplistic.
People don’t seem to realise how deprived some people actually are or how badly the education system has failed them.
Many don’t have access to the internet or the skills to apply for jobs online.
We know what very low unemployment looks like because we’ve just experienced the lowest rates the country has seen since the 1980s.
The topline rate dropped to 3.2% in the last quarter of 2022.
Obviously, this was a false reality. A mixture of closed borders and fiscal and monetary policy stimulus created labour shortages and with it brought inflation pain that also did real social damage.
Wouldn’t it be nice to live in an economy dynamic enough to sustainably create jobs?
The Government has signalled that having seen off inflation it is turning its focus to economic growth.
People often question what we mean by higher GDP growth.
Ultimately, if we want New Zealand to be a vibrant, thriving society it has to mean more jobs.
Getting past the peak and living with it at current levels won’t cut it.
Liam Dann is business editor-at-large for the New Zealand Herald. He is a senior writer and columnist, and also presents and produces videos and podcasts. He joined the Herald in 2003.
