Offshore, near shore and unsure
Updated
When I took an offshored gig with Fairfax, I found myself playing an unwitting role in the rise of New Zealand as a low-wage economy, writes Rachel Buchanan.
The orange star on the tailgate tilted and dipped, wobbling. The plane dropped low over the sea, ready to hit the short, sodden runway, but at the last instant swooped up again.
"Failed! The Aussie pilot failed to land!" I shouted. "They’ll be spewing."
My kids rushed over to look. The walls of our house screamed as the pilot readied for another go. The plane nosed down towards the enormous grey waves that were smashing over the breakwater but again the pilot pulled back, tucked the wheels up inside the plane’s battered belly and flew off north.
It was spring, 2012. Seven months earlier, we had touched down on that same wicked runway, a family of five who had left Melbourne to spend a year or so in Wellington close to my parents.
Money was tight and I had reluctantly taken a job as a sub-editor with Fairfax Editorial Services. I sat in an office in Wellington and edited newspapers in regional and rural New South Wales. My job existed because Fairfax had sacked 66 production journalists in Newcastle and Wollongong and replaced them with 40 others in Wellington. I was on $NZ65,000, about half of what someone with my experience would have earned in a metropolitan Australian newsroom less than five years ago.
(This trans-Tasman pay disparity exists in any field you can think of, including the airline industry. In 2010 a first officer employed by Qantas subsidiary Jetconnect was paid $NZ77,978 while a Qantas first officer earned the equivalent of $NZ126,815. In 2011, Fair Work Australia rejected the Australian Pilots Association test case on the issue.)
By taking the offshored Fairfax job, I had become enmeshed not only in the imminent death of newspapers but also the rise of New Zealand as a low-wage economy (save at least 30 per cent in costs over here folks), a little rival to the Philippines and India (save 70 per cent or more over there).
The staff on Project Hermes – Fairfax’s codename for the NZ offshoring plan – worked in a windowless basement on Boulcott Street. One night, while I was having fish and chips with my relatives, I joked about my work conditions (zombie journalists, typing robots and crypts). Rather than laugh sympathetically at my tales of drudgery and bewilderment, my uncle Bill expressed his pleasure at New Zealand’s ability to compete.
I respect Uncle Bill. He’s a really lovely guy, but he is also the Deputy Prime Minister. I’m not betraying any confidences here. What Bill (English) said to me is the same as what he has said in public. In his role as Finance Minister, Bill has welcomed Australian investment in New Zealand and the jobs that come with it. The logic goes that while lower wages are not good, they do allow New Zealand to compete, and competition is one way to close the gap in wages between the two countries. As yet, there is no evidence that this is happening.
I finished at Fairfax in late December 2012 and we returned to Melbourne the next month. Since then, the offshoring of Australian work to New Zealand has received plenty of media attention. In Australia, much of it has been negative. One theme is that New Zealand is somehow betraying its Anzac mates by stealing Aussie jobs, but the situation is messier than that.
In the 1990s, hundreds of jobs in food, clothing, cosmetics, pharmaceuticals and software manufacturing left New Zealand for Australia. Now, New Zealand Council of Trade Unions economist Bill Rosenberg said jobs were moving in both directions as companies cut costs across the region by getting closer to bigger markets or cheaper raw materials and workforces.
This is true of factory work. In 2009, McCains shifted frozen food production from Smithton, Tasmania to Hastings, Hawke’s Bay (200 jobs lost). In the same year, Cadbury closed its factory in Auckland and shifted production to Australia and Thailand (265 jobs lost).
Similarly, in late 2011, Heinz closed its factory in northern Victoria, cut staff at two others, and moved production of canned beetroot, tomato sauces and some meals to another factory in Hastings (340 jobs lost). In 2012, Unilever closed its New Zealand washing powder factory and moved production back to Australia (58 jobs lost).
But when it comes to office work, offshoring seems to be moving in one direction across the Tasman, with Australian companies attracted to the cheaper wages, rent and power bills in New Zealand. They like the loose industrial relations system, the very low compulsory superannuation payments (3 per cent) and the hardworking and obedient staff who speak good English.
Business process offshoring (BPO) is an industry term for what is going on. It encompasses skilled and unskilled work: architectural drafting; accounting; legal services; sub-editing and graphic design; making and receiving phone calls; answering emails; and working with social media.
New Zealand Trade and Enterprise, the government’s trade and investment body, boasted that New Zealand was "rapidly becoming a powerhouse outsourced service provider for the region". This is an overstatement. In the Philippines, the "contact centre" industry is expanding rapidly and will employ nearly one and half million people by 2016. By contrast, in Australia, there are 200,000 contact centre "seats" and in New Zealand there are just over 32,000.
Most of the Australasian "seats" are filled by people who answer phones and work computers for clients in the same country (or even building) as them. But about 3000 of the seats in New Zealand are for Australian clients based either in New Zealand (outsourcing) or in Australia (nearshoring).
Amway was a nearshoring pioneer. The cleaning and cosmetics company set up its regional contact centre in Auckland 12 years ago. Woolworths, iiNet, Lumo, ANZ, Quickflix and L’Oreal have also sent jobs across the ditch and Fairfax has continued to offshore work to Fairfax Editorial Services, its wholly-owned New Zealand subsidiary. Last year, about 40 more Australian journalists lost their jobs when the company offshored production of the Australian Financial Review, Good Weekend magazine and other features and sections pages of The Age, The Sydney Morning Herald and The Canberra Times.
John Chetwynd, the managing director of Auckland-based Telnet, said his company started doing work for Australia’s Sony Ericsson "some years ago". Australian companies had been sending office work to New Zealand "under the radar" for about a decade but the practice had only been talked about openly for the past year. Of their 250 staff, 40 worked for Australian companies.
Last year, CallActive and Contact Centres Australia both opened centres in Wellington and Unity4 announced it was bringing "cloud-based" contact centre work to New Zealand too. Public service cuts mean there are plenty of empty offices in the capital. CallActive started with 200 seats on a single floor, but has since leased another floor with 200 more spots. "We are interested in targeting companies already in the Philippines or India and trying to provide an alternative for them," chief commercial officer Justin Tippett said.
Contact centres spruik New Zealand as a place with a strong cultural alignment to Australia, a "stable, modern infrastructure" and a "stable political environment". New Zealand Trade and Investment is rather blunt about the other appealing factor. "Labour costs are extremely competitive for a first-world country with a highly skilled and educated workforce," it says on a webpage headed "New Zealand’s Investment Advantage".
Every company I spoke with said it paid well above the minimum wage (in New Zealand it is $NZ13.75, in Australia $AU16.37). Most said the hourly rate was $NZ17 to $19 and that permanent staff outnumbered temps, but I have not been able to confirm these claims with employees.
While stability may be a selling point for investors, it is not one for staff. As an outsourcing executive told me, off the record: "This work moves around quite a lot as a company tries to find the best location."
The New Zealand Parliament is now working through various amendments to the Employment Relations Act and these changes are likely to make New Zealand even more attractive to investors (and less attractive for staff). One provision sets up 90-day trials so that for the first three months a new employee has no right to file a personal grievance claim or to appeal an unfair dismissal. Another removes an employers’ duty to conclude collective bargaining. Meal and refreshment breaks will no longer be an automatic entitlement and employees have to provide proof of sickness or injury from the first day of leave.
At the moment, the only apparent glitch in the offshoring bubble is the New Zealand economy. It is buoyant, due to a post-earthquake building boom and strong dairy prices.
When Fairfax hired me as an offshored sub, $AU1 bought $NZ1.25, but this year, for the first time, the New Zealand dollar is likely to reach parity – or even eclipse – the Australian one. This may make New Zealand less appealing to Australian investors and less stable for offshored employees who know that being cheap and very hardworking are two requirements of their employment.
When I was an offshored worker, I felt lucky to have my job but I also felt insecure. I had taken the work of Australian colleagues. What was theirs was now mine but what was mine could swiftly become someone else’s. In 2011, Fairfax sacked 90 newspaper advertising staff in New Zealand and offshored the work to India. Some had worked in the same Wellington building as us. Giddy-up, their empty desks said.
This is an edited version of an article to be published online tomorrow in Griffith Review Edition 43: Pacific Highways.
Rachel Buchanan is the author of Stop Press: The Last Days Of Newspapers and worked for The Age in Melbourne. View her full profile here.
Topics: work, business-economics-and-finance
First posted
Comments (41)
Comments for this story are closed, but you can still have your say.
Maynard:
14 Feb 2014 4:11:41pm
It's even more competitive in LA and the UK.
And with IT, medicine and education NZ also has a competitive advantage that could be turned into an absolute price advantage.
Who'd have thought that NZ would not only be unbeatable in rugby but also jobs? It is a competitive, sophisticated, economy that could easily be the Australian service centre, based on performance.
New Zealanders have every reason to be proud of their achievements. If they manage this well it will set them up for a generation. Add a bit of entrepreneurial drive and they could become a more prosperous nation than us and we cover their defence costs.
Alert moderator
dpete:
14 Feb 2014 4:16:47pm
I strongly urge all LNP voters who rely on wages to make a living to visit NZ to see the future of Australia they voted for. I did last year and it is scary - BUT you've gotta love their land, it's a miracle of a place.
Alert moderator
Colmery:
14 Feb 2014 5:43:34pm
Is Tony Abbott really capable of matching wits with NZ?
Alert moderator
aGuy:
14 Feb 2014 5:44:36pm
How exactly is Australia heading towards New Zealand?
There are a few things I would support to bring us closer such as removing state governments, change of compensation to be purely injury based, not one which requires tearful testimony and years of lawyers to get more (thus harming treatment), reducing our refugee intake and a few other things.
Alert moderator
Schuey:
14 Feb 2014 5:46:49pm
The NZ economy is booming, Parity with AUD awaits. Employment is bountiful. Not sure what is scary about that?
Alert moderator
RayS:
14 Feb 2014 8:07:12pm
Rubbish. NZ unemployment went from 3.9% at the start of 2008 directly to 7% and hasn't been below 6% since.
That's despite relatively low wages.
Working people have borne the brunt of economic pain.
That's exactly what Abbott has in store for Australia, even though the crisis has passed, just to serve the interests of the few through the disadvantage of the many, out of pure failed ideology.
Thanks be to Rupert Murdoch and his turd polishers.
Alert moderator
gbe:
14 Feb 2014 6:17:25pm
dpete: Yes the public servants have a terrible time ahead don't they the ones left will even have to do something. Not many LNP voters though.
Alert moderator
TC:
14 Feb 2014 7:26:58pm
Everything also costs a lot less in NZ, so its all relative. Wages are high In Australia but so is the cost of living.
Alert moderator
MG:
14 Feb 2014 8:23:50pm
Rubbish. I talk to a lot Kiwis who come to Australia on holiday, and they all say the same thing, how expensive New Zealand is compared to Australia. They go to stores like K-Mart and Target and buy up clothes, electronic goods are also cheaper.
Alert moderator
NoGoodNamesLeft:
14 Feb 2014 8:24:15pm
You must have some serious issues if you find NZ scary dpete.NZ is not only a beautiful place but the people are fantastic and friendly. There is a reason NZ is rated as the best country in the world for personal freedom. People take accountability for their actions and decisions to maintain that freedom from oppressive laws. I strongly urge all Labor voters to move to North Korea if they want to see what happens when a communist government looks after everyone and distributes the wealth and justice evenly.
Alert moderator
Rob:
14 Feb 2014 4:25:44pm
'What was theirs was now mine but what was mine could swiftly become someone else's. In 2011.Fairfax sacked 90 newspaper advertising staff in New Zealand and offshored the work to India"
An WA Accounting firm sacked 20 of its staff and offshored the work to the Phillipines.
Almost like musical chairs- one day there will only be one chair left!!
Seems we are in a race to the bottom which the LNP Govenrment is determined to win-even if there is only one chair left for the 22 milion of us.
Oh for some lateral non economic rationalist thinking.
Alert moderator
OUB :
14 Feb 2014 6:12:06pm
So Labor wasn't in government when Rachel's job went offshore?
Perhaps if you stand on the shoreline and hold your arms up long enough you can halt the waves. A year should do it.
Alert moderator
Rob:
14 Feb 2014 7:56:58pm
Maybe it was,so what. Labor is playing the same tune as the LNP only the latter is more hooked on it .Msybe if you took the blinkers off ,looked up you will see the coming tidal wave.
Alert moderator
jaycee:
14 Feb 2014 4:31:59pm
What was that classic comment by the striking shearers in the film ; "Sunday Too Far Away"...: "It wasn't so much the money...it was the bloody insult!"
Alert moderator
Benice:
14 Feb 2014 4:56:26pm
I'm an old hand and remember the scorn heaped upon anybody who suggested back in the '90s that globalisation was anything but a good thing.
Western leaders and multinational corporations sang its praises and anyone who objected, or even protested, was dealt with swiftly as an extremist, anti-business, anti-progress and, ironically, anti-jobs. There was also a fairly convoluted argument which positioned all anti-globalisation campaigners as racist by reducing the circumstances of each battleground as being country vs country.
What the anti-globalisation movement was actually about, at its core, though, was finding a way in which globalisation could be achieved without only benefiting the rich who were able to exploit its flexible metrics, as something that would raise people up rather than dragging a whole lot of people down.
What was required to achieve this was international cooperation and some degree of enforceable international law that would regulate those who exploited globalisation, so that the loftier ideals could be achieved. Unfortunately, at the same time, all the 'cool kids' (I use this term loosely!_ in global economic positions of influence were on the economic rationalism bandwagon, the free trade bandwagon, the libertarian capitalist bandwagon, the anti-organised labour bandwagon.
Thus any hope of achieving equity and fairness and ensuring that the standard of living, wages and conditions of workers in any individual country were protected went out the window. This is because greed, ideologically blinkered adherence to libertarian philosophy in the field of economics and faith in market forces does not work with globalisation.
This is particularly, in the case of market forces, because it doesn't start with a level playing field. To allow market forces to operate unbridled in such an environment, where there are already inequities between countries, concentration of resources in the hands of the few, widespread exploitation, education and population differences and expect that none of these factors will skew things to the rich at the expense of the poor was deliberately ignored by...guess who?
I'll tell you who - the same people who are benefiting from this situation now. And guess which country is now party to a very lopsided free trade agreement that contains within it the seeds for our own ruin. Yep, Australia. Thanks, Tony.
No wonder your mob is trying to talk down wages in this country. Because pretty soon, it won't be up to you anyway.
I hate to say I told you so. I really hate it.
Alert moderator
Rob:
14 Feb 2014 6:29:36pm
Good post Benice. I have quoted Professor Carrol Quigley a numbe rof times on this forom but he was so right-his words are worth repeating again and againt.
In 1966 he wrote : The powers of financal capitalism had another far reaching aim, nothing less than to create a world system of financial control in private hands able to dominate the political system of each country and the economy of the world as a whole"
The vehicle they used was the DEBT TRAP- set in stages- begining with in 1971 when the dollar went off the gold standard. Global debt now stadn at some $100trillion.For more revealing details take a look a the the Web of Debt Blog.
Globalisation in itself was not a bad idea but it was hijacked by financial capitalism and compliant Governments under the guise of economic rationalism or the free market.
Alert moderator
Alpo:
14 Feb 2014 6:40:13pm
Well Benice, in just a few words you have dissected the history of the world since the late'70s. But don't worry, the system has an unintended core of self-adjustment. When you press too hard for individualism and selfishness, but the individual is unhappy, that individual will finally revolt against the prevailing system. The cunning Liberal spinmasters (inspired by British conservative ideologues) are trying to neutralise that with the mantras: the age of entitlements is over, live within your means... Poor little naive ones, they cannot see that the process they started cannot be stopped with spin....
.... It will take some time before we find a new and better way... but we will, we will.
Alert moderator
What the:
14 Feb 2014 7:39:15pm
Alpo this is good article but I think you will find that all the examples happened under the labour government.
Labour did not fix our car industry or Kodak either and there is no point throwing good money after bad.
The globalisation of Australia began with the Hawke government one of Australia's greatest governments (I am being serious)
Alert moderator
Alpo:
14 Feb 2014 8:20:06pm
What the,
easier trade among the nations of the world is good, provided that the end result of the process is an improvement in the quality of life of all the People in a country. When a point is reached where the current system of globalisation is not delivering good, sustainable standards of living for everyone, then the system must be challenged and improved. This should be the priority in my view, whoever takes it on board gets my support.
Alert moderator
Cheap Cars at Last.:
14 Feb 2014 7:23:24pm
Hilarious. You really think whining about equity is going to convince anyone to pay the higher prices caused by trade barriers? No way. The moment someone offshores a job, their costs go down and I get to buy their products more cheaply. If it's tough for some mollycoddled prima donna unionist leech, then even better. That's why the Toyota closure is such a celebration.
Alert moderator
Snake:
14 Feb 2014 8:23:11pm
Good post, Bernice. Thanks.
I think about globalisation similarly to how I think about global warming. These are (obviously) global phenomena. Facts. And we need to deal with them as such. Both have hit a critical momentum and are unstoppable. Both continue apace. So, the question becomes about how we manage them, not how we stop them.
Of all our politicians, I think Malcolm Turnbull stands above the pack in understanding both of these ideas better than his contemporaries. Greg Combet was another, and he is sadly missed.
Alert moderator
Scotty A:
14 Feb 2014 5:09:16pm
"One provision sets up 90-day trials so that for the first three months a new employee has no right to file a personal grievance claim or to appeal an unfair dismissal."
In Australia that is called "probation"and can be extended to 6 months in some cases.
I'm not sure about some of your other points but I have definitely experience having to "provide proof of sickness or injury from the first day of leave" through stat dec or some other means like a Dr's Cert.
Alert moderator
Joe Blow:
14 Feb 2014 5:12:59pm
Maybe we should all be bosses instead of workers. The ultimate capitalist dream?
Alert moderator
Alpo:
14 Feb 2014 6:28:05pm
"Maybe we should all be bosses instead of workers"... Yes, that's indeed the ultimate capitalist dream: be a boss who does not work....
Alert moderator
Alpo:
14 Feb 2014 5:13:50pm
Offshoring is only explained by the fundamental drive of any capitalistic system to maximise profits for the company, for the benefit of their shareholders. If that means making everybody else a loser, they couldn't care less. They are only restrained in their escalating grab for profit by the limit beyond which nobody would buy their product, but until that point is reached, they are driven to push the system in the direction of maximum profit as far as they can. It helps if the local Government decrease taxes, of course. Now, within this logic the decrease in the costs of labour is also a very important component: wages are lower in NZ than in Australia and much lower in India. Now, the Neoliberal conclusion after realising this discrepancy in wages is that in order to make our "country" more competitive (= the company maximises profits for their shareholders), wages must decrease. There are many faults in that logic, but the most obvious one is that you cannot decrease wages in Australia to the point where they become competitive with the wages in New Zealand or India if the costs of living are drastically different. Give me the costs of living of India and I may consider reducing my wage. To understand what I am talking about have a look at this (all prices are in Australian $):
a) Average cost per square meter for an apartment outside the city centre: Melbourne $6,155; Wellington (NZ) $3,381; Bangalore (India) $671.
b) Average monthly rent for a 1 bedroom apartment outside the city centre: Melbourne $1359; Wellington $1135; Bangalore $132.
c) Half a kilo of bread: Melbourne $2.95; Wellington $2.56; Bangalore $0.43.
d) One litre of milk: Melbourne $1.47; Wellington $2.34; Bangalore $0.54.
e) 1 kilo of chicken: Melbourne $12.23; Wellington $15.18; Bangalore $3.34.
f) 1 kilo of potatoes: Melbourne $3.05; Wellington $2.25; Bangalore $0.46.
g) 1 kilo of apples: Melbourne $3.96; Wellington $3.1; Bangalore $2.45.
So, if you live in Melbourne you may probably boast an advantage with your mate in Wellington with regard to milk and chicken, but if your salary decreases you will do so from a shelter for the homeless, or perhaps from a hospital bed being treated for serious vitamin deficiencies.....
Alert moderator
Raskul:
14 Feb 2014 5:17:53pm
If we are not sending jobs offshore we are importing cheap foreign workers to do Australian jobs here. Even the job of queen of Australia is off-shored to a low paid foreigner. Maybe we should off-shore some political jobs. I hear Tony Blair would be happy to take on PM of Australia at a cut rate.
Alert moderator
Alpo:
14 Feb 2014 6:16:57pm
"Even the job of queen of Australia is off-shored to a low paid foreigner."... I agree with the off-shoring of our formal Head of State (pathetic, isn't it?), but I dispute the "low paid"... I wonder how much money the Australian taxpayer has to fork for the regular visits to Australia of the various members of the Royal Family...
Alert moderator
Michael Dixon:
14 Feb 2014 7:17:32pm
I believe the appropriate expression is "Sweet FA". Certainly far less than a visit from a US President.
In fact, there are excellent articles on the expense of running the US Presidency, which is expensive on a galactic scale, highlighting the miserably low cost of running the monarchical bit of a constitutional monarchy, which governmental system I am happy to confirm is the best possible of all the democratic systems which have, from time to time, been tried elsewhere.
Alert moderator
Alpo:
14 Feb 2014 7:54:33pm
Michael, the US Presidency is expensive because it's the US, not because it's a Presidency.
As for your suggestion that the Constitutional Monarchy is the best system, etc.... I can only wonder why, since the 19th century, it has been much more likely that a Monarchy evolves into a Republic than a Republic regresses to the more primitive state of a Monarchy (constitutional or of any other kind).
Alert moderator
aGuy:
14 Feb 2014 5:22:39pm
I wonder if there has been any different in quality as jobs increasingly move outwards. There will still be some need for staff on ground and lack of detailed face to face communication may cause difficulties.
When it comes to editing, how can a person in a foreign nation truly understand what the local population elsewhere wants?
Fairfax is in a steady decline.
I have little sympathy for the editors when NZ$65,000 is half what is expected five years ago. Today the average wage is around AU$72,000.
$130,000 is more then enough to suffer variability. I have faced that as a young professional, never exceeding $60,000 in a year.
Alert moderator
p Grant:
14 Feb 2014 6:02:29pm
Fairfax Media is a public company listed on the ASX. Its directors fiduciary, and legal duty is to act in the shareholders' interests; corporations law requires this.
Yes, those directors and those under their direction have to look after the interests of their employees (through IR law) and customers (through trade practices law) as well, but it is well established that the directors can't have 'many masters'; the shareholders' interests trump all others, by law.
It is the way of the world when it comes to corporations. That's why counter-balancing protections through other (IR and trade practices) laws are so important.
Alert moderator
tball:
14 Feb 2014 6:07:15pm
I would have felt sorry the people working in the media until today when for the first time I saw on foxtel a show called the contrarians . what a bigoted overpaid and self important bunch of people without a trace of humanity amid them. go and get a productive job in industry on a basic wage then see if you think workers are overpaid
Alert moderator
Peter59:
14 Feb 2014 6:18:47pm
It is good to read an article with good first hand factual information and analysis.
I would also like to know some additional information such what charges Fairfax editorial services submit to Fairfax.
It is quite Ok for companies to lawfully run their businesses the best way they see fit, however all to often many of these companies over reach with tax minimisation efforts through transfer pricing etc.
If Fairfax earns revenue in Australia from selling their wares and by reducing labour costs through offshore arrangements that is fine by me as they will be paying more tax in Australia, which would in turn help the government cover retraining or unemployment benefits.
If however the companies running their operations this way overstate their offshore services costs then that is entirely another matter all together.
Obtaining this additional information would be almost impossible and would only be available from the ATO and its NZ counterpart.
Rachel could even look at company structures to see who owns Fairfax editorial services and how much profit they make and what taxes they pay in NZ. As most media outlets say they are losing money but I just wonder what their respective services divisions are making.
Australia needs a plan for how it attracts business to invest and create jobs.
Our wages must be competitive on a world scale and commensurate with our internal cost of living.
Productivity is the key to high standards of living as that allows higher salaries.
Labour in highly mechanised businesses is around 10% to 20% of their costs and in labour intensive businesses it would be around 50%, there would be higher and lower examples.
We must target the highly mechanised and smart industries as the area to grow or else we just end up with a low standard of living and no prospects.
We have lots of sun, land, water, education, gas and other resources although the best of these have been taken. The answer required is what to do with them and in this global world of very large corporations if Australia is going to prosper I'm afraid the government needs to provide financial incentives for the smaller entrepreneur as has been demonstrated here larger corporations are governed by the profit margin.
Alert moderator
punch:
14 Feb 2014 6:27:21pm
Let's face it when people are young, relatively responsibility-free, adaptable and mobile - the world is their oyster with regards to global employment and choices. Youth is adventure and risk, but its short-term.
This quickly changes when people want to settle and create a secure foundation for work, family and life. That's the norm.
The silence of extreme conservative "I'm Alright Jack' governments, like Abbotts mob, to debate a liveable wage or confront the harsh reality of under-employment forcing many people/families into untenable, low-paid, insecure employment whist the old banking systems/rules won't allow them credit - creates a great divide in communities.
This is happening rapidly in Australia. Its divisive, creates instability, crime and splits societies.
Many NZers consider their country to be an economic basket-case. They muddle through. The inequity is appalling.
Tony Abbott thinks its a shining example of how people can be ground down, social safety nets removed and unliveable wages applied.
Its a bit like the failed 'trickle down effect.'
Eventually economists/ historians will look back at the shifting/changing businesses always trying to move somewhere else to force wages down for greater profit as 'an economic global disaster'.
I have a feeling it may be sooner than later.
Alert moderator
Henry:
14 Feb 2014 6:52:28pm
For some time NZ has been a 'back door' way of getting to Australia for many Indian and Chinese people who do not otherwise qualify for permanent entry to Australia.
Go to NZ and qualify for a NZ passport after 3 years there and then get on a plane to Oz without need of a visa or a security/probity check.
Mr Abbott may be turning back the boats gleefully, but what about this laissez faire attitude where we rely on another country to screen immigrants to our shores?
Alert moderator
the nose:
14 Feb 2014 6:54:06pm
Soon as we get rid of the unions we can cut wages and conditions and become competitive with NZ, and other low wage economy's.
Alert moderator
observer:
14 Feb 2014 7:08:25pm
Business oriented governments seem to forget that they are managing the country for the whole population not for the benefit of a small minority. I remember going on a course back in the 70's and listening to a manager from FORD UK say the reason why Unions had become so strong in the UK was because of the appalling way managers treat the employees. it's fairly obvious that this government is going to do it's level best to destroy the unions and to reduce many of the benefits that employees have today.
Well here's a bit of lateral thinking. Why not let the recruitment industry act agent for an employee - in other words the recruiter negotiates with the employer on the behalf of the employee, and then if the employer treats the worker poorly then the recruiter just finds the worker a job somewhere else. So every worker signs up with a recruitment company and pays what they would have to the union, - the recruiter ensures the employee gets the proper training etc. The power is then with the recruitment company because they know where the best employee and skill set is.
Alert moderator
Mervo:
14 Feb 2014 7:23:18pm
25% of all New Zealanders live in Australia. That says it all. It is what we will become if our Government keeps going the way they are currently.
Alert moderator
OUB :
14 Feb 2014 7:39:33pm
Thanks for that Rachel, your perspective is interesting. The world will continue to become more and more competitive. We are no longer protected by our isolation, the internet and air travel have shrunk the globe. Countries that invest in education have a real chance of improving the opportunities for their citizens. We can complain about the unfairness of life, lament the loss of our birthright of complacency, or we can continue to compete. It is not hard to imagine a large element of unconscious racism behind many of these complaints, a sense of misplaced entitlement.
I see here people blaming bosses and the rich. They do not want to compete, they look for scapegoats to explain their, um, lack of success. (Personally I prefer to blame myself for my failings). They are unable to comprehend that they are happy to accept the advantages flowing from globalisation and greater competition in the form of cheaper goods and may even buy overseas goods over the internet but still they prefer to absolve themselves and blame others. Perhaps they think others are preying on their weakness for imported goods. Who knows? All pointless. Call it progress or call it a creeping cancer, there is no stopping the competition driven by leapfrogging technologies. There is a plus in that many advances seem to be relatively simple and inexpensive. There are biotech and tech companies that can run with such innovations, using first mover advantage and continually reinvesting and developing.
The kiwi has threatened parity previously. A big part of it was their different mix of commodities. If they want a strong dollar they are welcome to one. It will damage their competitiveness just as it has hit ours. But it does put pressure on prices and makes buying goods on the internet more fun. And it will annoy Australians, a simple pleasure that seems to be near to their hearts.
Rachel those jobs had gone offshore before you took one. You took it from a NZer, not an Australian. Don't know if that makes you feel better. What should make you feel better is that your obvious skill with the written word will stand you in good stead, even in a globalised world. Good luck.
Alert moderator
What the:
14 Feb 2014 7:49:31pm
I own a small business if consumers do not buy my product I cannot pay wages.
It is also incorrect to think that someone's wage is there cost of employment try adding Superannuation, Holiday pay, Sick leave, Public holidays, workers compensation, payroll tax. long service and if you are large business because it is so complicated employing people you have to employ someone to look after your employees.
Plus profits are needed so the owners are compensated for their risk and time (otherwise they might as well be employees for someone else).
So it comes back to the consumer if they don't by the product or service (like a Fairfax newspaper) then workers lose their jobs.
Alert moderator
Matt:
14 Feb 2014 8:04:36pm
My job as a imaging specialist with FairfaxMedia was made redundant in April last year, the work was sold to a New Zealand based company using workers in the Philippines.
I think its about time the ABC reported on events like this on the theory of the company involved , the time to stop sheltering like minded media agencies has gone
Alert moderator
Comments for this story are closed, but you can still have your say.