Photo: RNZ
Stella Saul says things are very tough financially at the moment - both for her personally and for others her age.
The 23-year-old Wellington woman graduated from university with a degree in development and international relations in October. She has been applying for jobs without success.
"I'm lucky enough to have a part-time job, but I haven't been able to transition into fulltime as I usually do during the summer period because my job doesn't have enough work for us at the moment."
She said her job was a fairly low-skill role at an accounting software company and some of the work she might normally have done was being outsourced to AI.
"I'm applying for a lot of jobs but haven't had a single interview yet, even though I have a lot of work experience and am definitely really employable."
She said she made about $1300 a month from her part-time work. Rent was $300 a week and then another $60 to $120 went on power, gas and internet.
She relied on her mother to support her. Her father had previously also been giving her money, but he had been affected by the public sector cuts and lost a contract. "I would not be able to continue to live out of home without her."
She has opted to go into a master's degree in development in part because of the lack of work.
"I thought maybe the conditions will be better when I finish my master's. I'll be absolutely moving overseas immediately for work when I've finished post-grad."
Saul said a lot of people she knew had only been able to finish their degrees because of the support of their parents.
"I don't think I know anyone that didn't receive support from parents and graduated. A lot of people were moving down to part-time study so they could work more hours as well. A few people that were studying full-time and working 30 or 40 hours were so extremely burnt out and depressed."
Rent and groceries were the largest pressure points, she said. "Expenses I feel are really out of my control. I don't feel hopeful that the situation is going to improve."
Data indicates that while the cost-of-living crunch was improving for most people, the younger generation, such as Saul, was still feeling the pinch.
Centrix data shows that people aged 18 to 24 have had the biggest increases in debt arrears since 2020 and that remained at elevated levels while other age groups' arrears have started to track down again.
Fincap - the network of financial mentors - said its data showed 18 to 25-year-olds had the lowest median income increase last year at $23 a week compared to $59 for the overall median.
AUT finance lecturer Ayesha Scott said data indicated that young people were more financially stressed than other age groups.
Her work found a quarter of young adults were constantly repaying buy-now-pay-later debt and more than a third had debt repayments that were greater than 30 percent of their income.
Scott said there was a link between worrying about money and general well-being. It was hard to see a path for young people that would "shift the dial" on their financial situation, given the current economic environment, she said.
"If you're at university you're already worried about what you're going to do after university. University is not free so you may have student loan debt… how a university graduate or school leaver is thinking about building financial resilience is an important conversation we need to have.
"It is difficult to get a job in the current climate. How we are going to shift this financial stress for younger New Zealanders is crucial to be thinking about," she said.
It was compounded by the housing market and wages rising at a lower rate than cost increases, she said.
Scott said when she moved to Auckland in 2016, people were already talking about how expensive property was and 10 years later the situation was worse.
"If you're a younger person charting your financial path in life I can imagine you could be doing all the excellent money management and still feel behind or financially under pressure. The conversation we need to have is about the pathway we offer young people to build financial resilience and independence. We try to offer bandaid solutions that aim to tweak one part of the problem without looking holistically at the entire environment."
She said the gap had widened between young people whose parents did not own a home or have significant assets and those who did.
People whose parents were not well off would have no bank of mum and dad to lean on, she said.
"The capacity and capability to chart your own path is trickier than it was not all that long ago.
"We need to understand that it's ok to have an honest conversation with our kids about money, about how it's going to be tough, and really start to give them the tools to think about their lives very strategically rather than falling back on 'just go out and get a job or go to uni then buy a house'. I feel that isn't necessarily resonating with young people. The world they are growing up in is different from even their parents and certainly their grandparents."
Scott said questions also needed to be asked about whether studying - and taking on debt to do so - was the right option for all young people.
"The message that if you don't know what to do to go to university puts a lot of pressure very early on young people to chart out their entire lives without having a discussion about whether university is right for them - every university student needs to know why they are there because they are paying for it."
Saul said things seemed to have got tougher in the past year in Wellington.
"I am very privileged in that my parents would never let me starve, I'll always have a roof over my head... I know there are so many people who haven't' been able to continue to study or have had to do it a lot tougher than me. It takes a toll on your sense of worth not being able to support yourself."
She said she hoped that things would have improved in 10 years' time when she wanted to move back to the country.
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