The talent squeeze has changed shape, not gone away

Start with the rare good number. Fewer of our tech people are eyeing the departure lounge. Younity’s latest temperature check of just over 1,000 New Zealand tech professionals found 26 percent were considering leaving the country in 2025, down from 41 percent a year earlier. That is a real improvement, and it fits what many of us are seeing: people want to stay if there is good work here.

The wider migration picture is less cheerful. Stats NZ data shows a net loss of 28,500 people to Australia in the December 2025 year. That is smaller than the 31,100 lost in 2024, but it sits right at the level of the 2004 to 2013 period, when losses to Australia averaged about 30,000 a year. New Zealand citizens made up 86 percent of the 47,500 who moved across the Tasman. RNZ reported a record 72,700 New Zealand citizens departed in the year to September 2025, mostly to Australia, for a net citizen loss of 46,400.

Scarce at the top

Set that against what tech leaders say they need. In CIO.com’s 2026 State of the CIO research, 40 percent of respondents named a lack of in-house talent as the top challenge in implementing AI over the past year. The shortage is not people who can talk about AI. It is people who can build reliable, production-scale systems, and that is a much smaller pool.

Security tells the same story with higher stakes. Fortinet’s 2025 global skills gap report, covered by IT Brief, found 54 percent of organisations blamed a lack of security skills and training as a leading cause of breaches, more than half said cyber incidents cost them over US$1 million in 2024, and 48 percent of IT decision-makers called the lack of staff with AI expertise their greatest challenge. A ManageEngine analyst writing on SecurityBrief put the local sharp end plainly: in a market of five million people, losing one senior security or governance professional can set an organisation back years.

A two-speed pay market

Salary pressure has not vanished. It has concentrated. Robert Half’s 2026 New Zealand guide reports tech salaries have largely stabilised, with most employers offering modest 3 to 5 percent increases. But pay rises are focused on rare and emerging skills, particularly AI, data engineering and automation, where counteroffers are becoming more frequent as companies fight over the same short list of names. If your critical people sit in those disciplines, assume someone else has their number, including offshore employers who no longer need anyone to relocate.

Quiet at the bottom

The other end of the market is the one to watch. Stanford research analysed by Stack Overflow found US employment of software developers aged 22 to 25 has fallen nearly 20 percent from its late 2022 peak. Across high-AI-exposure roles more broadly, employment fell 6 percent for that age group while rising 9 percent for workers aged 35 to 49. Tech internship postings are down 30 percent since 2023. AI has not emptied the profession, but it is narrowing the front door, and there is little reason to think New Zealand is exempt.

That anxiety shows up locally too. Younity found job security has overtaken workload as the top workplace stressor for NZ tech workers, and 66 percent are concerned AI will affect their future job security.

So the squeeze has changed shape rather than gone away. Scarce, expensive capability at the senior end of AI, data and security. A thinning pathway at the junior end. And a neighbour three hours away happy to solve its own shortage with our people. The leaders who come out of this well will be the ones thinking hard now about where their next senior engineers come from, because the market is quietly deciding that question for everyone else.