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Have your say: Fear of new exodus as Aussie wages rise faster than NZ wages
Grant Thornton has released a survey showing 78% of Australian companies expect to increase salaries in line or more than inflation, while only 55% of New Zealand companies expect to do the same. Grant Thornton said this could make it even harder for New Zealand employers to recruit skilled staff. Grant Thornton partner Peter Sherwin said the latest survey should act as a warning to those who thought the exodus to Australia had ended. "We are already in danger of losing many of our top talent to Australia, and this will only increase as the wage gap between the two countries gets wider," Sherwin said. "Clearly this is yet more evidence identifying the growing urgency for the Government to create the right environment for businesses in New Zealand to perform and retain our talent. Reducing the top personal income tax rate would help," he said. In Australia 23% of companies intend increasing wages more than inflation and 19% expect no increase. In New Zealand, which is in line with the global average, 12% expect to increase wages more than inflation and 41% to hold wages at present levels. "Just in the last few weeks we have seen two sharply contrasting pictures. On one hand we have over 2,000 people trying to get jobs at an Auckland supermarket, while on the other there is a growing shortage of medical graduates as they head to Australia and beyond where remuneration packages are 30% plus higher than in New Zealand," Sherwin said. "While it is great that our unskilled and semi-skilled unemployed are getting job opportunities such as in Auckland, it is the highly skilled that will take the country forward, and it is these people that have the greatest financial carrots dangled in front of them. The last thing New Zealand wants now is to have our recovery stalled by a shortage of talent." My view
The government appears to have slipped back into a state of complacency about the loss of skilled New Zealand educated staff to Australia in the wake of the slowdown in the exodus last year. The underlying problem has not been fixed and the sound of sucking (our talent across the Tasman) will resume as the Australian economy kicks off again. The government's moves on tax reform suggest the top income tax rate will only be cut from 38 cents to 35 cents at best, which is nowhere near enough to change either the incentives to work here or the incentives to invest here in anything but property. Your view?
27 Comments
Somedays it feels like we
Somedays it feels like we are already part of Australia....
Maybe we should formalise this reality.
I agree with your comment
I agree with your comment re the top tax rate possibly only going to 34-35c, after BE's speech a few weeks back, unless it was one of those under promise over deliver tactics. After hearing JK on Q&A though I thought they might be looking to bump the top rate far higher than it currently is, i.e. up towards $200k. Also, while they are looking to equalise the top rate with the trust rate, I wouldn't rule out the trust rate possibly going up to meet in the middle, i.e. both at 34c or 35c.
We seem to be stuck
We seem to be stuck in a ideological ground hog day....
The problem with the cut the top rate cr*p is, look at who is moving... ie its pointless cutting the top rate if those moving are not on it or barely....ie the un/semi-skilled....in fat we want those to leave.
Also those who make money in NZ, they seem to be mostly gambling on property, are they really going to move? bet not.....
The tax break from dropping the top rate is a handful of dollars....fundamentally the salary is better for medical graduates....who pays these? the public health service....
So someone on $150k in NZ is going to leave? if we cut the rate by 3% whats that? $100 more a week? is that really a substantial difference?
And finally look at supply and demand, the so called economic market forces of this the right whingers are so proud of to fix things...
ie If ppl leave then employers are going to have to pay more to keep or attract staff.
regards
Agree with rc.... it was
Agree with rc.... it was definitely the impression/illusion I got from the QA with Mr Key.
Alignment with Australia....
I sit and ponder why
I sit and ponder why so many are so puzzled at the govt intention to run with the same gameplan used by Labour idiots...tweak a bit here and tinker there...run out the spin dressed in BS...offer some trinkets to stay in power....promise strategies to solve the problems....then back to the trough for another feed...why are people puzzled!...this is Noddyland shite govt in action...
In this country..govt inaction and spin will always dominate over long term quality management.
The gst saga is a repeat of the twg saga...yet another version of 'float the idea and let the peasants argue the toss'...then do the least you can while promising the most in results. The real gains from a gst rise will be wiped out and may well have a final negative outcome. More will water the veg and feed the chooks...swap services and avoid the bloody tax.
Meanwhile govt waste continues...borrowing billions continues...until Mr Market arrives and boots the economy in the bum with higher rates on the gargantuan mountain of bloody debt..nothing of substance will change.
Say bye bye to tens of thousands of well skilled young people and their families at the departure gate..........
... and the governments answer???
... and the governments answer??? .... targeted immigration.
This to me is a cop out, we are importing the skills we are losing rather than training and educating our own people. We are effectively importing economic growth that we are failing to produce by ourselves. And finally and most importantly we are failing to address the root cause of why people are leaving in the first place.
We are stuffed. We don't
We are stuffed. We don't have a government that governs for the interests of the nation. We didn't before and we don't now. We are stuffed, get used to it.
@Wally "tweak a bit here
@Wally
"tweak a bit here and tinker there", "Noddyland shite govt"
Maybe... but is the problem that we hold onto the illusion that we can be anything more than part of Australia. 4 million people, debt owned by Aussie banks etc.
Just a badly run town council really...
Bill English's must have seen
Bill English's must have seen this coming when he adviced Massey Uni students to go work overseas :)
Whatever KWJ....you can follow the
Whatever KWJ....you can follow the idiots along their pathway to greater debt and misery...or think for yourself...which is what young skilled Kiwi will and are doing...and off they go.
The exodus will serve to destroy the property bubble. That will not magic away the debt. The debt will remain to be paid off one way or another by the unfortunate sods left behind.
Welcome to the world of poor fiscal management and shoddy economic planning...all neatly wrapped up in a package of socialism and destined to take Noddyland in the direction of Greece...but without the history!
@rc: i.e. both at 34c
@rc: i.e. both at 34c or 35c. Agree, and why not? (anybody?) why is a trust lower anyway?
regards
The bigger question is: Will
The bigger question is: Will their 'skills' be relevant after the crunch? Seems to me we've got a horde of wide-eye'd little economics and business graduates running around, who wouldn't know shit from clay in the real world.
We might be better off without them.
And Australia has it's own problems. They may have mineral wealth - a one-off asset - but they are embarking on a massive military/submarine programme to defend it. Plus a stimulus package, a housing bubble, and no water.
Give me a sunburnt country? No thanks. I've already got my shack, out the back, on the road to..........Waitati....
I was involved in medical
I was involved in medical recruitment and one of the significant reasons why medical grads leave is not pay, but to further their experience or to be involved in medicine at a level that is not available in NZ. An newly graduated medical student I spoke to said that he was off to either Oz or UK as he wanted to specialize in anesthetics and he was not able to get the experience he needed here in NZ as it was an area tightly held here. He was however intending to return to NZ after a few years when he would have the skill set needed to get a job here. If you ask those who say they are leaving because of their student debt, if they would still go if they had no student debt, the answer is usually, yes they would still go.
Wakeup folks, it is a rite of passage for most kiwis to go overseas - medical grads are no exception. When I was in Oz towards the end of last year there was a media report that said that less than 10% of the kiwis moving to Oz were skilled workers.
We always hear about those leaving, but not those returning. I employed doctors from the UK, USA etc who emigrated here after coming to work here as locums. All of them had young children.
The world is a revolving door for skilled workers - they come and they go and where there is a shortage in specific skills, that shortage is usually worldwide in varying degrees.
You have to take this
You have to take this in perspective. Go to Hay Recruitment website and check out their latest salary survey. The gap in salary isn't that big for professional jobs. I think the big gaps are in un-skilled or mining related jobs
My wife works is a
My wife works is a specialist for a regional DHB and the main reason she is leaving ? antediluvian work practices ! (the other being she's seen my old postings on this site, we have had a long overdue reality check !) So its back to the UK for us, permanently this time. John key, the spiv economy, capital gains tax, tele news and current affairs for mental midgets ! good luck and good bye.
"You have to take this
"You have to take this in perspective. Go to Hay Recruitment website and check out their latest salary survey. The gap in salary isn't that big for professional jobs. I think the big gaps are in un-skilled or mining related jobs."
Spot on the money. This is because Australia still has strong unions and award rates in a lot of these occupations.
FYI latest migration stats showing
FYI latest migration stats showing a turnaround in trend migration.
New Zealanders are leaving again, ASB's Jane Turner points out.
http://www.interest.co.nz/ratesblog/index.php/2010/03/01/net-migration-d...
cheers...
Bernard
@casual observer -11.10 : "..Wakeup
@casual observer -11.10 : "..Wakeup folks, it is a rite of passage for most kiwis to go overseas.."
The tense in your comment may have changed CO.
I can't speak with the authority of you on medical workers, but in the IT, Legal and Financial Market games that I know a bit off, the rite of passage has turned into a a bit of financial nightmare, for some, of late. Left for the opportunities; weren't there; came back - jobs gone; now what! .
It may not be not "is", but "was".
Trend series in Table 2
Trend series in Table 2 in spreadsheet (Column I) shows trend emigration of New Zealanders bottomed out in August at 5,100 and rose to 5,240 by January.
The turnaround has started
cheers
Bernard
Agree Bernard. The gap between
Agree Bernard. The gap between NZ and Aussie is widening at increasing rates (as reflected by our FX rates). Salaries are increasing in OZ and I bet that Q2 or Q3 of FY10 will see a large swing in immigartion. Re. the tax rate, do you really think they will only drop to 34-35%? What an absolute waste of time. It does nothing to fix the broken tax system or to keep the skilled, productive NZ's here. As Don Brash said in the weekend, that is the price of populist democracy, where the bulk of society have absolutely no clue or care about reality. They are either too selfish or stupid to know and the Govt has too many vested interests to tell the truth.
Eastie...take me with you! I
Eastie...take me with you! I can't stand anymore. We call the TV news " 50 ways to die horribly in New Zealand" I can't watch anymore. Murder, bloody murder. The murder of the English language too, with the kiwi accent so bad that its virtually unintelligible.
Ugly, overpriced houses, cheap Chinese rubbish in all the shops, and now summer is only 3 weeks long. Whats to stay for??
Why would that be fear?
Why would that be fear? Who are you afraid for?
People leaving will be happy there, people staying here will have more opportunities, higher income...so, everyone happy.
@casual observer -11.10 : “..Wakeup
@casual observer -11.10 : "..Wakeup folks, it is a rite of passage for most kiwis to go overseas.."
Used to be a 'gap year' - a temporary game, bar work and a six week tour of the world.
This has changed.
I knew many UK based Kiwis (teachers mainly) who stayed much, much longer (student debt often cited as a reason...).
Maybe they come back, but maybe they don't.
My job here in the
My job here in the IT field. I know that similar jobs offered in Sydeney/Melbourne are between 5-10% higher, Brisbane 10% less. Other IT professionals shared the same view. For now, the grass may look a bit grenner but when you get there you'll find it was huge patch of astro tuff !!! so watchout - it's may be the case of newspaper's sensationalisation.
OE means different things to
OE means different things to different people obviously. To me it was never a 'gap year' but literally an 'overseas experience' that took as long as it took and in my circle of friends it was the same. Alot seems to depend on expectations of what an OE actually is, one's flexibility and one's motivation . I know of a young qual accountant took went to UK on holiday, sussed out job market, came back, resigned and went back to UK to work. IT worker (web developer) worked in Holland for 12 months (no affiliations to Holland, and still doesn't speak dutch) came home to set up own business, hadn't been home for two months and was contacted by dutch to contract work for them from NZ as they are so short staffed. Others work the northern and southern ski seasons, and tractor drivers in between and earn more than they would if they were in their specialty in NZ. Work for them is spread over three countries, so probably don't qualify as tax residents in any of them and have a lifestyle that is envied. Some are Uni grads, some are not. But they all didn't leave NZ until they had a pot of money that they could leave here to come home to.
NA: 'now what!' A young architect friend was laid off and believed his chances of being employed as an architect was proabably quite slim so made a career change and is now dairy farming. For some of our Uni grads the reality may be that they have quals that no one wants and therefore need to find an alternative career.
"You gain strength, courage and confidence by every experience in which you really stop to look fear in the face" Eleanor Roosevelt
I think " gap year
I think " gap year " is a term used in the UK/ US. Kiwis refer to their OE and it is generally at least 2 years. Been there done that , came home.
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