New Zealand filled jobs are down to levels last seen in early 2023 as global uncertainty makes employers cautious about hiring.

The number of filled jobs rose 0.1% to 2.35 million in May from a revised 2.34 million in April, which was the lowest reading since January 2023, Statistics New Zealand said Monday in Wellington. The May result was the second-lowest over that 28-month period.

The data follows indicators of a manufacturing contraction and declining consumer spending that have led economists to project sluggish economic growth in the three months through June. Economists expect the jobless rate to move higher in the second and third quarters as US President Donald Trump’s unpredictable trade policies erode business confidence.

“We expect hiring to remain anemic over much of 2025, with firms likely to remain gun shy on expansion plans,” said Mark Smith, senior economist at ASB Bank in Auckland. “The global environment remains extremely uncertain and fickle.”

Hiring tends to lag the economic cycle, so some of the downtrend in filled jobs will reflect New Zealand’s sharp recession last year. But the failure of employers to respond even as the economy grew 0.8% in the three months through March suggests weaker momentum in the labor market, said Smith.

Most economists expect slower growth in gross domestic product in the second quarter, with ASB tipping a 0.3% expansion. The Reserve Bank’s Kiwi-GDP nowcast currently projects just 0.1% growth.

Finance Minister Nicola Willis last week said there has been evidence that tariff uncertainty and Middle East turmoil have knocked domestic business confidence and investment “and these global events mean it will be very challenging to sustain the previous level of growth.”

Weaker demand and less pressure on wages adds to signs of further interest-rate cuts, although several economists expect the RBNZ will leave the Official Cash Rate unchanged at 3.25% at its next decision on July 9. Investors are betting on a 25 basis-point cut in August but there is a less than 40% chance of any further reductions this year, swaps data show.

Business confidence lifted in June after dropping to a 10-month low in May but there is underlying caution across industries, ANZ Bank said Monday.

“Dark clouds globally are impeding risk-taking, though we did see the rebound in many forward-looking activity indicators,” Chief New Zealand economist Sharon Zollner said. “But in terms of what firms are actually experiencing, there’s been a bit of a slump recently in both activity and employment.”