The housing problem isn’t a housing problem; it’s a regional development problem

datePosted on 21:18, May 27th, 2014 by Lew

I have noted with growing despair the xenophobia which is becoming a political commonplace this election cycle. On the left it’s about house prices.* But this post is not about racism; it’s about development.

The national median house price is $415,000, a figure skewed substantially upwards by the extraordinary cost of housing in Auckland. But you can buy a three bedroom house in Taumarunui for $26,000, or for $67,000 in Tokoroa. These are extreme examples, but for considerably less than half the median price you can buy a charming colonial villa in Tapanui ($149,500). For a little more than half the median you can buy a newly-renovated house on an acre in central Gisborne ($225,000). Similar houses are available for not very much more money in larger regional centres like Dunedin and New Plymouth, and that’s without considering many apartments, townhouses and more modest types of dwelling.

There are houses out there: there just aren’t jobs to go with them.

The chart above shows income and employment growth by region, and this is why the houses are so cheap. The growth is just not there. (From the Ministry of Business, Innovation and Employment Regional Economic Activity Report 2013).

Opportunity
It’s not just jobs, though; there’s more to life than work. People need confidence in their opportunities in a new place before they will, as Jolisa Gracewood says, buy shares in that community by owning or renting a house there and settling down. They need schools and hospitals and civic institutions and a sense of belonging, they need certainty about their community’s future, and their future within it.

The community likewise needs needs certainty in its new arrivals. A gold rush or an oil boom might provide jobs and cash, but it doesn’t provide certainty for either group. Certainty — and opportunity — comes from deep and sustained development. The fly-in/fly-out mining towns in Australia are a good example, and while that industry has been instrumental in maintaining Australia’s robust economy, its direct value to the regions has been limited — trickling down, lifting all boats — without the adoption of targeted development initiatives such as Royalties for Regions, which seek to return a share of the proceeds of industry to local communities.

As Eric Crampton said about the census income growth figures, increases in average wages across much of the South Island have been coupled with decreases in population, as people on low incomes move in search of better-paying work. Rob Salmond agreed, saying:

The regions with the supposedly highest median income growth also had some of the worst records in population growth, while the areas whose populations grew the fastest had relatively little change in median incomes.

Returning to the MBIE chart above, notice the regions in the top-right quadrant: the West Coast, Waikato and Taranaki. These are distinguished by two characteristic sectors: dairy, and mining, each of which provides a relatively small number of well-paid jobs within a narrow sector, skewing up the income levels but not necessarily changing the overall development picture very much. As crucial as the dairy industry, in particular, is and will continue to be to New Zealand’s economy, a complete solution to development it sure ain’t. Which is why you can buy an enormous Moorish-inspired villa for $220,000 in the middle of gas and dairy country.

Diversification and specialisation
The object of a regional development policy must be to promote structural change, to create industries and communities that are sustainable in their own right — neither transient nor exhaustible, and which attract people whose commitment is likewise neither transient nor exhaustible. These jobs need to go beyond the traditional churn industries like tourism, hospitality and service; though, of course, these jobs will be needed, they should be incidental to development, not its purpose. They need to be high-value and export-led — unlike, for example, our timber industry, and our wool industry. One of our key advantages here is our reputation for being clean and green — demand for premium food, the safety and quality of which can be assured, and including organic and sustainably-produced, is likely to grow strongly and we seem ill-prepared to meet this opportunity, as just one example. Another example is the potential of Māori business, which is as yet terribly underutilised.

In New Zealand we talk a lot about the roles of government in distributing wealth, and in ensuring public access to health, education and other scarce resources. These levers are well-recognised and there is at least a moderate degree of bipartisan agreement on their use. This is not the case with regional and economic development strategies, where there are deep practical and ideological divisions between the parties. I can see why the noninterventionist technocratic right parties like ACT and National are reluctant to consider — or even recognise the viability of — the sort of robust, hands-on regional development strategy that will sustainable economic and community growth in regional areas and persuade the frustrated and overcommitted residents of our major cities to risk a change. It will require considerably more input than building roads, granting mining permits and water rights to permit the extraction of value directly from the land. It will require a lot more than public-private partnerships and white-elephant monorails through virgin rainforest. It very likely will require PPPs, roads, and mining rights, though, meaning the left will have to reconsider some of its positions as well. It will require thorough investment in infrastructure, especially transport infrastructure, and purposeful community-building, possibly funded by a deeper cut from mineral royalties, a localised share of revenues from key industries, or loans from the government. It will probably require considerable autonomy devolved to the communities affected, and the strengthening — rather than the weakening, as is currently happening — of local government. It needs to be a little bit New Deal and a little bit Think Big.

Diversity is resilience, and our economy is very narrowly based. That must change. Different regions have their own strengths — environmental and historical, in terms of personnel and capability — and this represents an opportunity to improve the national economy holistically, by strengthening each of its component parts, rather than by building one economic muscle until it threatens to throw everything else out of balance. In many cases these nascent strengths will need considerable augmentation, and some will need to be developed almost from scratch. That requires significant and sustained investment in research and development — contributions to which the National government cut during the time when it was most crucial; when talent needed to be incentivised to stay here, and when industry needed to prepare to take advantage of the recovery, when it arrived. Public-sector research agencies can be beneficial in quite unpredictable ways, and when it comes to blue-sky research, patience can pay off enormously. If you’re reading this over Wi-Fi, you can thank the Australian government’s scientific agency, the CSIRO.

People and places
One obvious and direct means by which the government can influence regional development is by decentralising — by relocating government departments or agencies to regional centres. At a minimum, governments could decline opportunities to actively dismantle regional industries — such as Invermay — for the sake of short-term cost savings or change for its own sake.

It is clear that having a critical mass of mobile public servants all located within a kilometre of each other can increase efficiency and cross-pollination in government and business. Some significant new businesses — such as Xero and Vend — clearly benefit from strong cohabitation and the development of their own start-up cultures. On the other hand, in the past decade telecommuting has become plausible for a large proportion of people whose work is predominantly reading, writing and talking on the phone, and the major reasons it is not more widely used are to do with middle-managers wishing to retain some measure of direct control over their staff, which they label “team culture”.

There are costs and benefits to decentralisation, but it is hard to shake the sense that government, and the public service, are growing increasingly remote from the people whose interests they ostensibly serve. The gap between the experience of living in Auckland or Wellington and living in the rest of the country is vast already, and is likely to grow. Over the long term, as regional development improves, mobility will increase, as the economic and cultural risk of moving to or from a major centre will decrease, and this seems likely to yield an even greater cross-pollination benefit than that sacrificed by decentralisation.

Political laziness from the left
The reason the housing markets in Auckland and Wellington are refusing to cool is because people — both internal and external migrants — want to live where there is opportunity, and Auckland and Wellington is where the opportunity is. Blaming foreigners for the continually-rising house prices in Auckland is counterproductive. It’s lazy populism for the opposition to monger fear on these grounds, and it’s clear why the government is perfectly willing to let them do so: first because it cuts against the left’s political brand, and second, because it frees them from responsibility for what has proven a poor regional growth strategy during their time in government.

Labour and the Greens have taken strong and well-articulated positions in favour of regional development and smart growth but they’ve also gifted the government an opportunity to reframe what is essentially an economic development debate as being about housing and migration, when the former is a symptom and the latter is all but irrelevant. As a consequence the whole discussion gets sucked into an unwinnable partisan slagging-match. This isn’t so much a failure of policy, but a failure of political emphasis. It should be relatively easy to correct: they mainly need to stop complaining about the yellow peril, and start talking about the future of a country where wealth and innovation is spread beyond its main centres.

Although I disagreed with his dismissive attitude towards the marriage equality debate, it seems likely that the once and future member for Napier, Stuart Nash, will be an important member of the Labour caucus in future. Late last year he argued persuasively that the regions are crucial not only for the economic wellbeing of the country, but for the wellbeing of that party, and so for the wider left. As he says:

If any party only holds seats in Akld, Wgtn, Chch and Dunedin, then they don’t have a particularly wide mandate to govern because they haven’t got MPs in caucus putting forward the views of the vast majority of geographic NZ.

To an extent it is understandable that this hasn’t happened yet. Development is hard. It takes a long time and a lot of money, and in a political context where governments change no less often than once per decade, it requires an uncommon degree of accord between increasingly diverse political movements. With the Greens now forming a substantial and apparently-permanent adjunct to Labour on the left, and the emergence of new climate-sceptic and anti-environmentalist sentiments within National and its allies, this is a big ask. But it needs to be done nonetheless. The regions aren’t going to develop themselves; they haven’t got the wealth or the people to do so, because it’s all tied up in tastefully-renovated villas on the North Shore and in Thorndon.

Downsouthing
This is not an entirely theoretical discussion for me. All going to plan, at some point later this year my family and I will move from the Kāpiti Coast to Dunedin. My wife is going to the University of Otago to work on the postgrad study she’s been wanting to do for 10 years. We’d have done it years ago if we could — every time we’ve been to Dunedin, we’ve said we’d move there in a heartbeat if only there was work. Mostly what’s changed now is that I can bring my work with me.

The reason we live out here is because out here is where we could afford to buy a house on one modest Wellington income. The idea was always to move into town at some point, but that has gotten more distant, not closer, over the past five years with Wellington’s housing market proving largely impervious to the recession. So off we go.

We anticipate significant benefits. My wife will be able to do something meaningful with her life other than raise our kids full-time or working as a rest home carer, worthy though both those tasks are. Commuting into Wellington would cost dozens of hours and hundreds of dollars a week, and at some point both of us would inevitably end up far from our young kids when they needed us. But not least among the advantages is the regional arbitrage of continuing to bring in something like a modest Wellington income while living in a place where houses are, very conservatively, $100,000 cheaper.

But there’s the thing: unless you’re privileged enough to work in a field where you can telecommute (and bosses who’ll let you), or unless you work in a literal field, moving from Auckland or Wellington to pretty much anywhere else in the country is a big risk. (In Christchurch, the case is much more complex.) You can move, but for many people, the opportunity is just not there, and the risk of giving up what you have is very great.

The government that raises those opportunities will find favour with those who want to move, those in the regions whose economies and communities are boosted by new growth, and those in the main centres who wish to stay, or must stay, who will have richer opportunities for doing do.

L

* On the right it’s more about asylum seekers (National) and internal threats to the colourblind state (ACT). The only party that seems clean of this is United Future, for which Peter Dunne should be congratulated.

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19 Responses to “The housing problem isn’t a housing problem; it’s a regional development problem”

  1. John Small (@smalltorquer) on May 27th, 2014 at 21:54

    I basically agree with this analysis.

    We moved from Auckland to a rural top-of-the-south community a couple of years ago. Housing is cheap and that currently attracts transients. I reckon that in an alternative future it could also be a magnet for a kind of rural-renewal-brigade though: a group of people working in locavore food and energy based industries.

    That’s just one option for a bottom-up approach to regional development. But it wouldn’t need the big $ govt investment you seem to envisage – just some flexibility-enhancing measures to expose certain sectors to grass roots competition.

    More generally, with improving electronic connectivity we should increasingly be able to do office work from anywhere. That will surely undermine the case for central govt workers to live in Wellington. As you indicate, governments should welcome this kind of thing.

  2. Lew on May 27th, 2014 at 22:49

    John,

    I think reasonable people can disagree about the specifics, but my position is that the Invisible Hand has had 30 years since Rogernomics to get this work underway, and it’s not happening. Time for a visible hand.

    L

  3. Hugh on May 28th, 2014 at 04:44

    First, Lew, on a personal note, I hope you guys have a great time in Dunedin. It is a fantastic place to bring up kids, and as a mainlander myself it’s always nice to see some of you Gringos “converting”. Having said that, pack your woolies – it gets vicious cold down there.

    Anyway, on to the substance of your point, I largely agree, but I think the thing missing from your analysis is that the low prices of houses in the regions partly reflects the lack of opportunity – there’s basically a “you won’t get a good job” discount built in, and as job opportunities and economic growth move to the regions, those house prices will rise. It’s potentially a zero sum game.

  4. Lew on May 28th, 2014 at 07:49

    Hugh,

    Thanks. Yes, it sounds grand. My father’s family are from there, so I’ve got uncles and aunts and cousins and such like, and it will be good to be closer to them as well.

    The central point I’m trying to make is exactly that — that the surfeit of opportunities, economic and otherwise, are why the real estate markets in Auckland and (to a much lesser extent) Wellington are so inflated, and the dearth of same elsewhere is why the regions are depressed. The price of housing in the rest of the country will, of course, increase as opportunity improves there, but the idea is to spread the growth around rather than concentrating it, resulting in relatively small, gradual and (importantly) sustainable increases across a wide area.

    L

  5. lprent on May 28th, 2014 at 09:04

    I’d agree that pushing the growth around is a damn good idea. That was sort of happening in the 00′s and I was noticing a lot more happening in the upper north island towns like Rotorua. But now I see a lot of deserted shop fronts

    But when I drove down from christchurch to invercargill a year or so ago, I was shocked. In the 80s, I used to service a lot of those towns from the Businessworld/Computerland in Dunedin while I was waiting for my partner to finish her degrees. Most of them appear to be slowly dying.

    The problem with remoting in tech industries is that it almost works in some areas. But not quite.
    * The first problem is of course the managers. If you think about them, they are almost invariably people persons and demand to be seen and see people. They like to read body language. There aren’t too many of them who feel comfortable with remoting outside of the geeks who got forced into management.
    * The second problem is that even geeks sometimes need to see geeks because there really isn’t a good alternative to whiteboards and looking over the shoulder for design work. There are similar problems with problem solving. This means that the iOS guy from Whangarei still has to travel to Auckland every month and it isn’t quite satisfactory.
    * The third problem is that many if not most of the export based industries starting in Auckland are not just software, services or words. The frequency of hardware mixing in is rising fast. You really really really need the hardware geeks around while you’re building the code (I speak from experience)..

    That all being said. While I don’t think that you can stop the concentration effects from tech industries – which are one of the few private industry areas that remoting can work well in. Service industries like government are a lot easier. However the underlying problem with those for individuals these days is a question of having *two* working adults in most families and finding work for both of them, and how easy it is to offload the house when you move.. I could go on forever. But I’d better get back to my site.

  6. Paul Rooney on May 28th, 2014 at 09:07

    Good article. We are a family who has recently moved from the Eastern Bay of Plenty back to Auckland for education of the kids and work for the wife.

    The biggest problem with regional development is the cost and return. Any development needs massive cash input,( which as a country we don’t have), which will probably never show a return. Opotiki has been pushing for a huge mussel farm off the coast for the last 10 years, development started and then the price dropped out of the product so, grinding halt.
    This is one example I know of but I’m sure similar things are occurring elsewhere.

    Opotiki is the centre of the universe and my fantasy is we could have stayed,earned a reasonable living and hunted and fished which is out family passion, but it’s very rare you can have it all.

    New Zealands biggest problem is we have no tax base, we do not have the population to sustain the public works we need and it really saddens me even as a National voter to see the Labour leader going down a anti- immigration track, silly and short sighted in an attempt to appease some 20 somethings who want their first house to be in Ponsonby. Buy a dump in a really uncool part of town like we did and do it up, if you are young you can fight the burglars off.

    Immigrants have vitalised New Zealand, I remember first going to Auckland in the late 70′s,what a drab, seedy place it was. The big wave of Asian immigration brought colour, variety of food and a “buzz’ to the place.

    As you say the government that can find the elixir that will spark regional development is a government for ever, sadly I can’t hold my breath that long.

    Geographically we are a nightmare as a country,with a 3rd world roading system. We have a political system that every malcontent or naysayer can hold things up and politicians who are too scared to ignore them and work for the greater economic good because without a sound economic platform the environmental and social platforms will suffer.

  7. Phil Stevens on May 28th, 2014 at 09:27

    Lew, your analysis pretty much spot-on. I’ve lived in the Manawatu for nine years and apart from the relatively buoyant local economy of Palmerston North it’s painfully evident why we’re in the bottom left quadrant.

    But regional development doesn’t necessarily require swallowing the neoliberal dead rats of unsustainable mining, acquiescence to dairying, and allowing the private sector to place its rent-seeking hands deep into the public purse through PPPs. We need structural changes in the taxation, monetary and public finance systems which do not penalise productive endeavour and investment, but make sure that resource extraction and other forms of enclosure are truly compensated.

    One of the biggest problems with the regions, as with local and regional economies the world over, is the “leaky bucket” syndrome. If one imagines the real wealth of a community as water, the modern economy gives that community a bucket full of holes in which to keep it. Since a great deal of what people buy nowadays comes from afar, money spent in a local economy does not remain there, and if the relative value of goods and services produced falls short of imports, the regional current account will always be in the red. Holes in the bucket.

    But there is a far more insidious and dangerous leak: money itself. 98 percent of the money supply in NZ is credit created endogenously by commercial banks. This money has a price tag in the form of interest (pure profit) paid to the issuing banks and since everyone uses it, there is a net outflow of wealth to the banks…not just out of the towns and regions but largely out of NZ thanks to the overseas ownership of the big four banks.

    Creation of regional currencies to facilitate internal trade would be a huge step in reclaiming an economic beachhead for development, and the introduction of resource rentals payable in these currencies would serve as a companion policy to stabilise trading values and prevent the net outflow of wealth. Local and regional authorities could spend a set amount of their currency into circulation to fund public works, accept it for payment of rates, and transactions in it should be exempt from GST. The urban centres would benefit from their own schemes: Auckland could finance a smart 21st-century public transport network, and Christchurch could get on with a rebuild that takes rising sea levels and increased incidence of extreme weather into account.

    The broader conversation around housing shows how the issue has touched a nerve in the body politic, but the debate we’re hearing right now is absolutely unfruitful and quickly becoming poisonous. None of the dominant voices are articulating the problems at the root: money (and therefore bank credit and the asset bubbles fueled by its unstable generation) and land (the principal asset whose value is bid up in a bubble and whose unearned gains are unwittingly donated by the community).

  8. Eric Crampton on May 28th, 2014 at 10:23

    Thoughtful post. A few additional reckons:

    - I worry that much of NZ’s relative decline over the last while comes down to increasing returns to agglomeration. All the tech stuff that should make telecommuting the norm instead works to put local face-to-face contact into hyperdrive: it’s a complement to proximity rather than a substitute for it. That’s one reason that big cities everywhere are getting pricier relative to the regions.

    - Agree entirely that prices in Auckland and Wellington couldn’t be where they are if there weren’t the local amenities and jobs that drew people to those places: those places are expensive because they’re productive. But we still could be easing up substantially on the supply constraints that make it increasingly expensive to build in those cities. And on some of the regs that increase building costs. It still amazes me that we’re only temporarily easing back the tariffs on gib-board. I know it’s a small part of housing costs, but it’s illustrative.

    - There has to be a literature on whether “split up the main govt departments into regional branch offices” winds up substantially reducing bureau effectiveness. I don’t know how big the relevant tradeoffs are here. But I know that, for example, Treasury and the Government Economics Network can put on all kinds of great seminars for staffers in the other bureaus because they’re all in Wellington. And while you could maybe say that you’d do the same thing with videolink, it’s always the chats over coffee and afterwards that provide the bulk of the value at these kinds of things. There would be real losses in splitting things out. I just don’t know whether they’re big enough to outweigh the advantages you’re thinking of.

    - Splitting things up through the regions also provides some redundancy advantages in case Wellington’s knocked out by quake.

  9. Moz in Oz on May 28th, 2014 at 14:44

    Regionalisation is fighting much bigger forces than I think you realise. As Eric says, the advantages of being physically close still exist and the extra cost of being in the regions is still there. All over the world there’s the exponential curve of city sizes within regions (it’s even fractal!), and they’re all sucking more people in from their hinterlands. In many ways that’s a good thing, from increased networking, lower environmental impact and better access. There’s just no way we’re going to see a “National {whatever} of NZ” in every regional centre.

    Many of the same arguments apply to people looking at Australia rather than just Auckland, in my case I moved from Wellington to Sydney rather than Auckland. Those forces mean that people and industry leaving Auckland are as likely to go to Sydney as regional NZ (being generous).

    I think we’d be better off looking at what we can do well in the regions, and how we can adapt to what I think is inevitable. What do we need to keep regions viable, and what should we push out to them. Yes, having national government facilities in at least the earthquake zone and on the volcano makes sense, and distributng stuff like schools and hospitals ditto. But splitting (say) Treasury between Mosgeil, Hastings and Auckland would just break it.

  10. Joshua on May 28th, 2014 at 15:10

    Good, timely post Lew. I to am planning a move away from Auckland and back into the provinces in the (not near but not far either) future. I thought I would add a few observations from two months working out of Whakatane.

    1. I tend to think that there are high-paying opportunities for professionals in the big cities to take advantage of and make the move. My company sends probably close to 100 people a week out into the provinces to provide consultancy / secondment services to organisations that simply cannot find local people skilled enough to do the work. But, as you mention, it is more for the highly skilled and not for those who are competing for low wage jobs.

    2. I like the idea of moving Government departments out to regional centres. Because the idea highlights a central point about regional development – the successful regional centres all have some form of large sustainable entity or entities operating there. You already mentioned Taranaki and the Waikato with their oil, gas, and farming industries – and we have seen the decline of once-thriving communities following the withdrawal of major industries such as timber mills for instance.

    3. This is where I put my Maori hat on and note that Iwi will play a big role in all this as well. The big settlements to come in so far have been main city based (Ngai Tahu in Christchurch, Tainui in Hamilton, etc). I’m currently working with a $100mm Iwi organisation in Whakatane and it is a major player in the local community which for all appearances has a thriving retail and commercial sector. I would expect that settlements such as the Tuhoe (Eastern Bay) and Te Atiawa (Waitara)to have a similar impact. A big game-changer will be the Ngapuhi settlement (Northland) and the Te Hiku settlements in the Far North. Each of these could prove to be a catalyst for regional development in those regions.

  11. deepred on May 28th, 2014 at 16:01

    The British certainly know how to do regional development. In recent times a number of companies that are usually London-dominant have delegated their services to areas like the North, like Leeds, which had been in genuine decline for some years. It also helps that they have a well-established rail network and large domestic market.

  12. Hugh on May 28th, 2014 at 20:07

    @Lew: Oh, cool to know you’ve got whanau there, that’ll make it easier, and it’ll be good for the kids too.

    Re: house prices, you’re right, and now that I think about it this actually represents a significant political obstacle to getting this kind of policy enacted – specifically, a lot of people have built or bought houses in Auckland and Wellington as investments with the expectations their values will continue to rise, so they will see this kind of policy as a threat to their investment, and probably vote accordingly.

  13. MikeG on May 28th, 2014 at 20:37

    The current government has actively discouraged regional development. The two examples that spring to mind are the closure of some regional IRD call centres and the failure to fund the rail line to Gisborne.

  14. deepred on May 28th, 2014 at 22:02

    Hugh: The NZ property bubble has become too big to fail, just like the farm subsidy policies of the G8. In both cases it’ll likely take something much bigger than politics to dislodge them, like a Second Great Depression.

    Lew: Can’t fault Dunedin, I originally hail from there, and went to Otago Uni for a few years. Still have a sizeable family element in the region.

    Paul Rooney: The biggest naysayers I’ve seen are those who want to scrap the RMA, but will invoke it if they happen to have interests in the property bubble – the Auckland Unitary Plan’s proposals to relax zoning restrictions within existing boundaries is an obvious case in point. TransportBlog has some neat coverage of the whole hypocritical affair.

  15. Lew on May 28th, 2014 at 22:14

    Thank you for some very good and wise comments.

    Lynn, Eric and Moz, I do take your points about the limitations of telecommuting and the importance of critical mass, collaboration and shared space. Since 2008 most of my daily work interaction has been with people in Sydney and Melbourne, and since 2011 or so I have worked 2 days per week at home. I work closely with colleagues in KL and Manila and Auckland and most of the Australian state capitals, plus a couple in rural NSW, and it works. We arbitrage timezones and public holidays across jurisdictions, and it works well. At times the tech is troublesome, but not too often. I don’t need a lot of personal contact with colleagues, though I will miss the small group of people with whom I work most closely when I do leave the office proper. So yeah, I get it.

    But what I’m advocating is not the compression of rectilinear objects into elliptoid cavities — I think we should be more vigorous about taking these opportunities for telework and decentralisation where it is appropriate, and not forcing it where it isn’t. Sure, not every podunk village will have a ministry HQ, but some thigns will be a better fit. Treasury in Mosgiel is daft, but how about the Ministry of Primary Industries in New Plymouth? The Ministry of Tourism in Rotorua, or Queenstown? The Ministry of Māori Affairs in Ngāruawahia? It doesn’t even need to be full ministries — until recently the IRD had a call centre in Invercargill, and dear friends of mine moved there from Wellington, and loved it, until it closed (they transferred to Hamilton, which is not too bad).

    Another factor for telework on the micro-scale has been the GFC — austerity and financial pressure within businesses and departments has led to some reluctance to invest in the tech and training required to make these changes, to disrupt existing work patterns, and especially command & control patterns. With staff cuts and sinking lid policies, managers have wanted to keep their people close.

    Ironically there was probably never a better time to do it, as the same period has also meant increasing workloads and stagnant wages, so every little thing you can do to make your staff’s lives easier will help. I know that being able to work from home has been a major factor in my employer keeping me, and by the same token I work my arse off so as not to squander the trust that comes with it. I think most people given the opportunity would do likewise.

    Edit: I see MikeG mentioned the IRD call centre in Invercargill as well. Yeah. And there are plenty of other examples.

    L

  16. Lew on May 28th, 2014 at 22:23

    Hugh, yes. Persuading the landed wealthy of Auckland and Wellington to vote against their capital gains will be hard going. Any shift must be gradual and measured; burst the bubble, put people into negative equity, and the whole gig is up.

    L

  17. johnathan b on May 29th, 2014 at 04:13

    it would be good to see another chart comparing average annual growth in filled jobs and average annual household income on the one hand with average house price on the other (for each geographic region) to round out the picture, agree?

  18. johnathan b on May 29th, 2014 at 04:29

    i’m just not convinced, from reading the article, that the “housing problem” is caused in whole or in part by regional development issues i.e. solving regional development issues through decentralisation etc could be putting the cart before the horse?

  19. [...] then I read things like this piece by Lew over at Kiwi Politico, and Labour’s new focus on immigration just rings even less true. [...]

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