The great OE exodus: Is there one good reason why young Kiwis should stay?
Tuesday, 24 May 2022
Dileepa Fonseka is a Stuff writer on business and politics.
OPINION: There are few things more embarrassing than being the last person left dancing at a party after the music stops and everyone has moved on.
A lot of New Zealanders are going through this right now as our social calendars fill up with leaving drinks, Facebook feeds are flooded with pictures of people at airports, and we add our signatures to yet another farewell card.
The spin on this is always that New Zealanders leaving the country are part of an ancient tradition of youngsters going to get blind drunk in London before sobering up and finding a proper job on Lambton Quay.
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But the more of these leaving drinks I go to, the harder it is for me to shake the feeling that there is a lot more to this than a delayed global pub crawl.
More than a few seem like they are leaving during their most productive years, with plans to return only when they are at their least energetic and ambitious.
As Employers and Manufacturers Association head of advocacy and strategy Alan McDonald points out: “There is a lot of demand for international travel, but it’s not necessarily just doing the traditional OE.
“We lost three or four staff to overseas postings over the last six to eight months, and we’ve seen some decent salaries on offer, particularly from Australia.
“I lost a policy adviser who is now getting paid A$40,000 more than she was getting paid in New Zealand – so I can’t compete with that.”
What’s different about this current movement overseas is that many are not just looking for an alcohol-soaked break from life – they are emigrating, and trying to pursue full-time careers.
And if they fail? Well, the mouldy $500-a-week granny flat in Johnsonville will probably still be waiting for them when they get back.
Their departure will only make the lives of those left behind more difficult, especially with similarly skilled replacements harder to come by.
We have already seen an early taster of this from Covid-19 and the recent Omicron surge. Many organisations were so short-staffed that employees had to push through sickness, or double their workload.
Infometrics economist Brad Olsen says 300,000 people were affected by Omicron at its peak, but the total number of hours worked dipped by only 0.2% in the first quarter of the year.
“Yes, there were a lot of people that were off, but there were also a lot of people that had to work even longer hours to try and pick up the slack.”
Olsen says there is every indication many employees are just at breaking point.
The Treasury’s economic predictions, released last week as part of the Budget, would have left many would-be great resigners with little to feel cheery about either.
House prices are forecast to hit their lowest point by the middle of 2023.
By then they will still be 32% higher than before the pandemic and, while wages will have inflated by 18% from pre-pandemic levels, the consumer price inflation index will have increased by 17% over the same period – wiping out most of those wage gains.
As Olsen says: “It is difficult to sell a convincing story to young Kiwis about why they might stick around.”
That said, McDonald says “the great resignation” being talked about overseas has not yet been seen in the workforces of EMA members over here.
He says employers who successfully retained their employees have made real investments in training them and been rewarded with loyalty in return.
Still, even with all of this, there are still people leaving, and these departures are beginning to pick up steam.
It is causing a headache for employers who can’t replace them with overseas migrants, and tougher times for those left behind who have to pick up more work.
Competition for workers is fierce. McDonald says Australian companies are poaching migrants stuck in our various immigration queues by promoting a move to Australia as a backdoor into New Zealand.
“Which is kind of the reverse of what they were complaining about us a few years ago, where people were coming here and backdooring into Australia.
“That sort of behaviour’s going on, so that’s a pretty aggressive market for talent out there, particularly in that migration space.”
New Zealand firms are also finding it tough to recruit overseas. McDonald relates the story of one large EMA member who habitually holds job fairs in the UK.
Normally they get hundreds of job applicants. This time they got only 11 inquiries.
“They were citing the high cost of housing, the high cost of living, and the difficulty of access if family and friends wanted to visit New Zealand,” McDonald says.
“So it was still perceived as a bit of a closed shop.”
Who can blame would-be migrants for thinking all of the above?
After all, so many of those who have spent the last few years living here seem to think much the same thing.