A new report from the Helen Clark Foundation is raising concerns about the growing impact of financial stress on social cohesion in Aotearoa, warning that economic pressure is eroding trust, fairness and connection across communities.
The latest findings identify financial strain as the single biggest driver behind declining social cohesion, with many New Zealanders reporting a reduced sense of opportunity and belonging as the cost of living continues to rise.
Economist Shamubeel Eaqub, who contributed to the report, says the data shows people are increasingly feeling locked out of economic progress, with widening inequality shaping perceptions of fairness and fuelling disconnection.
The report divides the population into three key groups – the Connected, the Ambivalent, and the Alienated – highlighting a society that is becoming more fragmented.
Those considered Connected tend to feel secure and engaged, while the Ambivalent group sits in the middle, uncertain about their future. The Alienated group, however, is growing, with individuals feeling excluded, distrustful of institutions, and disconnected from wider society.
Researchers warn this fragmentation poses serious risks, particularly as trust in public institutions declines and more people disengage from civic life. There are concerns this could undermine the country’s ability to make collective decisions and maintain a strong, functioning democracy.
The report also points to rising isolation, with some communities experiencing a breakdown in social connection as economic pressures intensify.
In response, the foundation is calling for coordinated, long-term action to address the root causes of financial stress and rebuild social cohesion.
Recommendations include improving income security, addressing housing affordability, strengthening access to essential services, and investing in community-led initiatives that foster connection and trust.
There is also an emphasis on restoring confidence in institutions through transparency, fairness and inclusive decision-making.
The findings highlight a critical moment for Aotearoa, with growing calls for action to ensure that economic pressures do not continue to divide communities and weaken the social bonds that hold the country together.
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