Hollowed Out: Where did all the jobs go?

Sunday, 22 March 2026

New Zealand is losing its professionals to better pay offers overseas, and at the same time, companies here are reducing jobs - and sending some of their roles overseas. In the second of this three-part series, The Post looks at job cuts and what skills and departments are being affected.

Tata Consultancy Services is a name that keeps popping up among New Zealand companies.

The global leader in IT services is the beneficiary of a fast-growing number of some of the country’s largest companies signing on to its services and seemingly opting to cut roles and staff, in favour to have these facilitated offshore, with the aim to cut costs to remain profitable in a prolonged depressed economy.

The Warehouse Group, Woolworths, Air New Zealand, Flight Centre Group, Westpac and ASB are some of the large organisations that have turned to Tata Consultancy Services (TCS) to outsource a wide range of tasks, including customer service, IT, finance and digital capabilities - roles traditionally filled by a firm’s in-house staff.

They are just some of hundreds of organisations worldwide that in recent years have turned to the Mumbai-based specialist in comprehensive IT and digital transformation services, as well as consulting and AI innovation.

Read more:

• Hollowed out: AI, offshoring, and the brain drain thin the ranks of NZ’s professional workforce

• NZ salary guide 2026: Employers face stubborn skills gap as talent flees to Australia

• Claims offshore outsourcing to ripple through The Warehouse Group

• ‘Salt to software’: India’s largest tech firm widens NZ footprint

Tata’s work with New Zealand companies comes as the local firms seek to find new ways to save money and meet their earnings targets, including their shareholder returns, amongst reduced consumer appetite. Sources tell The Post it starts with the companies seeking help for tech services, and swiftly increases to the point many company functions are taken offshore - functions like finance, human resources, supply chain, and customer service.

Companies capture this trend by saying they have “partnered” with Tata consultancy. What exactly that means is somewhat ambiguous, but can include functions as critical to a company as high-level strategy work.

Last month, TCS announced it had “partnered with” Australian-owned Flight Centre Travel Group, which operates more than 40 stores across New Zealand, to “support its global digital transformation journey”.

That followed similar announcements last year by the likes of Air New Zealand, which entered a “five-year strategic partnership” with TCS to drive digital transformation, improve operational efficiency, and enhance customer experience through AI, cloud computing, and automation.

Signed in March 2025, the partnership focused on upgrading IT infrastructure and supporting AI-driven innovation, and was announced at an event in Mumbai that was attended by Prime Minister Christopher Luxon.

Woolworths has been working with TCS for 25 years, and is believed to use the company for many functions, including running its help desk.

However, the supermarket giant would not provide any details or comment any further than stating TCS had “supplied” Woolworths Group for many years.

ASB said TCS played a small role supporting some of its engineering teams, but “they are not a major technology provider to ASB and we continue to run our technology systems in house”.

It uses TCS to augment some of its engineering teams and to provide extra capacity on projects. TCS currently supports ASB with some engineering skills that are hard to find in the New Zealand market.

In November, The Warehouse Group, which operates The Warehouse, Warehouse Stationery and Noel Leeming, announced it had engaged TCS to support the next phase of its transformation, “focused on simplifying the group’s technology stack”, with the aim to save the company $40 million in IT costs over five years.

Another $70m would be saved by laying off hundreds of staff and “co-sourcing with Tata Consultancy Services”, it has since said.

The cost of that saving? At least 270 head office roles axed, with more to be impacted as consultation continued “in a small number of areas”.

The retail group said in February that these job cuts would result in a “new leaner operating structure” for its head office.

“The group is expanding its partnership with TCS to support the delivery of several corporate and administrative functions, including parts of technology, accounting, call centres and payroll. It will provide the group with access to modern platforms, capacity and capability, including AI, at a scale and cost that would not be possible to build internally,” it said in a statement.

Warehouse Group chief executive Mark Stirton acknowledged the group “must make these tough choices” in order to return to profitability.

“Together with the non-labour cost reduction initiatives under way across the group, these changes will help strengthen profitability and allow us to deliver better value for our customers,” said Stirton.

“Labour cost savings of approximately $3-4m are expected in FY26, with annualised savings expected to increase to approximately $17m by FY31.

“These savings are in addition to the estimated $40m over five years announced by the group in September 2025 on its licenses and managed services partnership with TCS.”

In an interview that will be published in The Post tomorrow, the third part of this Hollowed Out series, Tata Consultancy Services New Zealand country head Ganesh Ramani said the company is not scooping up jobs let go by its clients.

He said TCS was not responsible for its partner companies’ decisions to lay off hundreds of staff, and that the company’s involvement was only as an advisor around technology, where it provides services such as replacing legacy technology or helping with AI adoption.

Offshoring or outsourcing?

Outsourcing or offshoring of jobs has typically been driven by skills shortages, leading firms to hire overseas, particularly in areas like IT, technology, and customer support.

However, in recent years it is used to secure cheaper labour - to fill jobs and roles at a fraction of the local cost - in countries such as the Philippines, even though there are the skills and people available to do the job in New Zealand.

Workers First Union has been grappling with this very issue, whereby companies transfer work and jobs that would traditionally be done by permanent staff to contractors or a workforce offshore.

Deputy secretary Rudd Hughes said cutting jobs and having the workforce of services companies carry out the work at a much lower cost was attractive for many companies.

He called it “incredibly concerning” that companies were partnering with service providers to take jobs offshore.

It was a “pure cost cutting exercise”, he said.

“It's a disaster, and we're seeing that in the unemployment rates,” said Hughes.

“We've got unemployment at 5.4%; that's the highest in 10 years, and quite frankly we need these jobs in New Zealand. Some of these are very good paying jobs, meaningful jobs, and we need to keep them here.”

Taking jobs overseas takes money out of the economy, and the banks were notorious for cutting jobs locally and sending them offshore, Hughes said.

“BNZ, is a long term outsourcer; they use a multinational company called Accenture, and Westpac uses another company too called Centrix. This is a common practice right across the industry. If you look at the big four ‒ Westpac, BNZ, ASB and ANZ ‒ they all do it.

“ANZ have put work out to the Philippines and Bangalore. Commonwealth Bank of Australia is offshoring; they have closed branches, and they've got jobs being sent to Suva, Fiji.

“It's not enough for them to make good profits. They want to increase their profitability all the time at the expense of New Zealand,” Hughes said of the moves.

He called it “a slap in the face” to staff who had typically worked for these companies a long time: “They're just put onto the scrap heap all in the name of profit.”

The union had seen a decline in a number of large employers’ workforces, including at The Warehouse and Woolworths, over the past year, he said.

“Where we have outsourcing, or offshoring, companies no longer have to provide minimum terms and conditions of employment. Sick and annual leave - that's gone; that's a cost of the company's books. Holiday pay, that's also a cost off the company's books, and the amount they pay is lower. In this country, we constantly hear about the return to shareholders, what we don't hear about is loyalty to workers,” said Hughes.

“They're cutting costs in the best way possible for them; labour costs. That's a disaster for the New Zealand economy, and it's a disaster for New Zealanders. We lost over 120,000 people last year. They left the country permanently to go mainly to Australia, where the wages are far better.”

Kim* is a manager in IT at ANZ and spoke to The Post on condition of anonymity. Kim said over several years more and more of their teams roles had been outsourced, following a pattern established by the Australian parent company.

Increasingly, that meant not just lower level IT programmers and coders’ jobs were going, but also design architects and others leading teams.

In Australia, there will be 3500 jobs cut across functions, but very much affecting the IT department, with people paid in India getting at least half the wage. Some of those jobs are, themselves, vulnerable to being replaced by AI. This seemed to be happening in New Zealand as well, with people asked to train their replacements.

Two-way street

Catherine Beard, director of advocacy at BusinessNZ, said offshoring jobs was “nothing new”.

However, what is new is the frequency and how many businesses in New Zealand are now engaging in it as part of business as usual.

“It's about having a viable business, isn't it? It's no secret that The Warehouse has had a few tough years, and you have to look at how to have a competitive and compelling service for your customers. The aim of a business is to stay in business, not to go out of business, so you need strategies to grow. Just because you're outsourcing part of your business to somewhere else in the world, doesn’t mean the goal for a New Zealand-based business isn’t to fundamentally grow here,” said Beard, when asked about the practice.

“If you outsource parts of it, but you become more profitable and more successful, then you can employ more people here doing higher value, potentially higher paid jobs.”

Beard said it was part of being part of a global marketplace.

“Some goods are traded in ships and containers, and some trade goes over the internet in bits and bytes. [It’s good to have] the ability to look around the world and source what you need for your business.”

Asked about the risk to the level of customer service expected by Kiwis not being up to par, Beard said: “Sometimes it works very well, and if the customer experience turns out not to be good enough, then companies tend to reassess and look at other ways to communicate with customers, which could be to bring the work back home again.

“In some ways, the trend is away from call centres and towards AI smart bots, where a lot of the volume of queries is handled by a Bot, and then a smaller team of people can handle complex enquiries.

“AI is also increasingly capable of things like IT coding, which has been an area of outsourcing in the past, so I would say it is quite a dynamic and evolving situation, and New Zealand has services exporters who solve problems for international customers as well.”

Academic’s perspective

Dr Alex Richter, professor of information systems at Wellington’s Victoria University, said there was an increased sense of urgency among organisations to come up to speed with technological advancements, such as AI adoption, which was perhaps driving the trend towards companies partnering with service providers such as Tata Consultancy Services.

Ritcher said the partnership model appeared to lend itself to a new hybrid work-together type model, as opposed to handing over all responsibility to the company, as was the case with traditional outsourcing.

“Air New Zealand, The Warehouse and so on, they realise these are critical services and cannot just outsource them. AI is a critical capability. ‘We're not just giving it away, but we're not ready for it now’ [is the thinking], so they hope for Tata to jump in, bring in the experience, because they have a lot having done this globally, to bring them up to speed, in a way that the leadership cannot be blamed that they just let somebody else do it.

“What this partnership entails is they get access to capability because they don't have the capabilities in-house, but they're not just buying labour,” Richter said.

“They're basically buying the engine, and they want to be in the driving seat themselves.”

Ritcher said outsourcing traditionally saw accountability defined by service level agreements. However, in this case it appeared that partnered organisations would build together and the clients would have more input into the work.

“This way, they share the gains, but also the losses, if it doesn't work.”

As to why so many companies seemed to be partnering with TCS, Ritcher suggested it could also be because the other options were organisations with roots in the US or China.

“A big term currently, is digital sovereignty for New Zealand, and we’re very aware of how highly dependent we are [on] some US providers, in the sense that if they decide to turn the light off, it's a problem for us. Tata, they are a powerhouse. They have a lot of experience, and they're very fast, but they're also not located in the US.”

Ritcher said he thought the move by organisations was good - but not at the expense of cutting jobs locally to spend that money overseas.

“Upskilling reasonably fast is a good idea and it's a very good idea not to put all eggs in one basket.

“Our job in New Zealand is to make quick progress in terms of upskilling, especially in the AI space, and make sense of where we sit as a society, but also as a business environment, in this space. I think that we were recently a bit too slow, and in a way, these new partnerships are an acknowledgement of that.”