IT workers struggling in New Zealand's tight job market

RNZ News

2 days ago

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Unsplash / Sigmond
IT professionals appear to be under growing pressure in 2025, with signs of continued job losses as companies respond to economic gloom and expand the use of artificial intelligence.
In May, Microsoft announced it would cut approximately 6000 jobs - about 3 percent of its global workforce.
The American tech giant said the move was part of a broader strategy to streamline operations and accelerate its AI initiatives.
In New Zealand, Health New Zealand confirmed in April it would
slash hundreds of IT jobs
- about a third of all roles.
Some job seekers have described the tech job market as a "nightmare", citing fierce competition and a shortage of opportunities that have made finding employment increasingly difficult.
James Zhang spent more than a year applying for IT jobs from China without success.
A software developer with roughly 12 years of experience, Zhang has previously held roles at several prominent technology firms in Beijing, including ride-hailing platform DiDi as well as Tencent, the company behind social media platform WeChat.
Zhang said one factor behind his decision to seek work in New Zealand's technology sector was the so-called "curse of 35" - a term widely used in China to describe age discrimination in the tech industry, where workers over 35 often face greater risk of layoffs and increasing difficulty securing new roles.
"I've had colleagues being laid off continuously since 2018, and it's often the older ones," he said. "In large tech companies, it's common to expect your age to align with your position - for example, by 35, you're supposed to be in a management role. If you're not, the company might see you as underperforming or no longer valuable."
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Zhang, 34, said he began applying for overseas IT jobs from China in 2023, targeting companies in countries such as New Zealand and Canada.
However, he said responses from New Zealand employers were rare.
"I probably submitted hundreds of CVs to New Zealand tech companies, but I had absolutely no chance of getting an interview," he said. "When an employer was initially interested, they often backed out once they realised I was based in Beijing."
By contrast, Zhang said he applied for around 20 to 30 positions in Canada and received at least two interview opportunities.
James Zhang is now pursuing a master's degree in IT project management at Auckland University of Technology.
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Supplied
In a bid to improve his prospects, Zhang moved to New Zealand this February and is now pursuing a master's degree in IT project management at Auckland University of Technology.
He hoped the qualification would help him break into the country's competitive tech sector after graduation.
Still, he said he remained uncertain about his chances, noting that many New Zealand employers appeared more inclined to hire local candidates.
"I'm still studying, so I can only apply for internship positions," he said. "When a New Zealand software company gave a presentation at our school, the eligibility criteria for interns clearly stated that only New Zealand or Australian citizens and permanent residents could apply."
Despite years of experience as a senior software engineer in China, Zhang said he would gladly take an entry-level position if it helped him gain a foothold in the industry.
Grace Zheng, who graduated from Lincoln University in 2023 with a master's degree in applied computing, has also struggled to find work in the competitive tech job market.
"I've probably submitted a hundred CVs over six months," she said. "For most [graduate or junior] positions, there are usually 200 or 300 applicants competing for the same role."
Zheng said she received four or five interview invitations but was never called back after the first round.
"I was told they had stronger candidates," she said.
Discouraged by the lack of progress, Zhang said she had stopped applying for IT jobs this year and was instead focusing on learning new skills to better align with market demands.
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Peter Xia, who has worked as a software tester in New Zealand's tech sector for about five years, said he had been made redundant twice since 2023.
"The day before Christmas in 2023, the company announced layoffs," he said. "It specialized in software testing and cut at least 20 percent of its staff in the first round."
Xia said he was fortunate to secure another testing role three months later at a start-up, but the company shut down just three months after he joined, citing a lack of investor funding and limited profitability.
He likened the IT job market between 2023 and 2024 to a "freezing winter," noting that several roles he applied for were abruptly cancelled during the interview process.
Xia said the market appeared to be gradually improving this year, though uncertainty remained.
He said all the companies he had previously worked for had hired him on permanent contracts.
But after being laid off multiple times, he realized that a permanent contract offered little security in the face of ongoing economic instability.
Lisa Cooley, managing director at BrightSpark Recruitment.
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Lisa Cooley, managing director at BrightSpark Recruitment, said New Zealand's tech job market remained flat and competitive, though there were early signs of a gradual recovery.
"Employers are adopting a very cautious approach to hiring at the moment," she said. "If they're looking for contractors, they've been favoring more fixed-term.
"If they're looking for permanent [staff], they're looking for someone absolute best and ticks 100 percent of the boxes [before] taking the risk to hire."
Cooley said immigrants faced greater challenges securing interviews in New Zealand, as the job market has been flooded with candidates in recent years due to economic downturns, large-scale restructures and widespread redundancies.
She said visa conditions remained a key factor putting immigrants at a disadvantage in an already competitive market.
"The visa process was also taking a very long time for a while," she said. "We were hearing stories of it taking four to five months from end to end.
"Obviously, most companies aren't going to wait that long, unless it's for a highly skilled role that few people in New Zealand can fill."
Shay Peters, chief executive at recruitment agency Robert Walters Australia and New Zealand.
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Shay Peters, chief executive at recruitment agency Robert Walters Australia and New Zealand, agreed that visa restrictions remained a significant barrier for immigrants seeking work in the tech sector.
"The first barrier for immigrants on work visas is their eligibility to generally work only for accredited employers," he said.
"Within ICT (information and communication technology), most accredited employers are vendors or consultancies who hire skilled migrant workers and then provide their services to a customer.
"Unfortunately, with the lack of funding, customers have to [reduce] spending on vendors or consultancies. There is less opportunity for them to provide to migrant workers."
Peters said employer demand had also shifted, with a growing emphasis on highly skilled workers in areas such as cybersecurity and software development.
"Organizations are seeking highly specialized and technical resources rather than the 'Jack of all trades' which were popular in 2022," he said.
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Peters said salaries and hourly rates had also recallibrated.
Contractors with strong reputations and a strong track record of going above and beyond were still commanding higher rates, while candidates with more generic skillsets - particularly in management roles - were now seeing offers that were $10,000 to $20,000 lower than what they were two or three years ago.
Peters said most of the firm's government clients had shifted towards hiring more contractors rather than permanent or fixed-term staff, citing budget constraints and operational headcount limits following recent cuts and restructures.
However, the private sector remained relatively steady in its hiring of permanent staff.
According to SEEK's latest
New Zealand Employment Report
, job advertisements in the information and communication technology sector rose by 7 percent from March to April and were also 7 percent higher year on year.
Rob Clark, country manager at SEEK New Zealand, said April marked the second consecutive month of positive momentum, suggesting a modest but noticeable job market recovery trend over the past seven months.
Cooley said job seekers should not be disheartened by current conditions, as the market appeared to be on the verge of a turnaround.
For immigrants, she said building a strong professional network was crucial to securing employment.