How many jobs have actually been lost in Wellington?

Tuesday, 17 December 2024

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Wellington has reportedly lost close to 20,000 jobs in the past year ‒ or has it?

It depends on who you ask and how you slice and dice the numbers.

Prominent economist Shamubeel Eaqub has used Stats NZ data to determine that from a year ago, the number of jobs in Wellington City has dropped 19,430 ‒ that’s roughly 11% of all jobs.

However, other notable economists have questioned that figure, with Eric Crampton and Brad Olsen both suggesting it is less than 3000.

Stats NZ, prompted by inquiries from The Post, is investigating.

Eaqub said his figures were sourced from employment tax data, using workplace location and residential addresses.

While the knife is being taken to public service ‒ one of the capital’s big employers ‒ the most recent estimate of job cuts, nationwide, is about 4000. Lost jobs in other industries are harder to quantify.

Eric Crampton said Public Service Commission data showed roles reduced by 2879 to 62,820 in 2023 ‒ although still 10,000 higher than Q2, 2019.

Brad Olsen, chief executive and principal economist of Infometrics, said he found it “incredibly hard” to believe Wellington had lost one in 10 jobs.

If the 19,430 job loss data was accurate, the effect on the city’s retail and hospitality industries would be noticeable, although he acknowledged those sectors were struggling.

Infometrics’ quarterly reports into card spending found many indicators Wellington was doing it tough ‒ “but not shaving off a whole tenth of the entire economy tough”, Olsen said.

“That’s over blowing it.”

Additionally, while there might well be 20,000 jobs lost in Wellington, it did not necessarily mean the workers were living in the capital. The city was the base for many company head offices.

Olsen said it was more likely the geo-coding for a number of roles been filled by people living outside the area had changed from Wellington to other areas.

For example, as of March, Central Otago had doubled the number of workers, despite no substantial change in population, he said.

“It looks like there’s been a head office shift.”

Olsen found that, for the people who were living and working in Wellington City and Horowhenua, there were 2200 fewer jobs.

“There’s definitely a loss for Wellington … I just feel that 2200 job loss in Wellington City is a more proportionate and reasonable looking number.”

Instead of compiling the data in one area, he looked at all 67 local council areas, based on residence and workplace basis.

This left more 16,000 jobs in Wellington City requiring people to come from outside the region to work, meaning they were likely remote workers.

“How many people are commuting every single day from outside of the region into Wellington? I’d really struggle to find it to be 16,000.”

When asked on the possibility of geo-coding skewing the data set, Eaqub said it did not seem possible ‒ but Stats NZ would need to confirm.

“If there's a problem with the data, then the data should be fixed.”

A Stats NZ spokesperson said they were aware of questions regarding the data and were investigating the territorial figures.