New jobs, old jobs: the evolution of work in New Zealand’s cities and towns

Paper for the Productivity Commission of New Zealand

This paper for the Productivity Commission of New Zealand uses census data to document and analyse the changing nature of jobs in regional New Zealand between 1976 and 2013. While the material is largely descriptive, its aim is to unravel the effects of several different forces on the evolution of jobs, towns and cities. This paper is not designed to make predictions about either the future of work or the future of regions. Rather, by documenting the evolution of regional employment patterns in New Zealand over the last 40 years, it aims to help understand how New Zealand has got to its current situation.

The changing nature of jobs has disproportionately favoured large “super cities”, which in the New Zealand context means Auckland. In New Zealand, and in other developed countries, much new work has emerged in information-intensive sectors such as finance and professional and business services where productivity is enhanced if firms cluster in a small number of centres. For example, two thirds of the national increase in employment in the finance sector between 1976 and 2013 took place in Auckland, even though Auckland started with just over a third of the financial sector workforce at the start of this period.

While smaller urban areas have also increased the share of their workers in these growth sectors, the growth of these jobs in these areas was less than in Auckland. So far there is no evidence that small urban areas can compete with large cities in these sectors, so if these sectors keep growing as a fraction of the economy, Auckland is likely to continue to benefit from the sectoral transformation of the economy.

As manufacturing declined and service sectors expanded, the economies of most cities and towns have become more diversified. In this paper we show there are only a few examples of urban areas that have become more reliant on specialist industries since 1976. Rather, most areas became more diversified and more like each other. Small and medium sized urban areas with distinctive employment patterns are less common than they were. As migration between areas is easier when all areas have similar jobs, the reducing importance of city-specific industries may have catalysed the shift of jobs from slow-growing areas to climate-favoured fast-growing ones.

Citation

Coleman, A., D. Maré & G. Zheng (2019). New jobs, old jobs: the evolution of work in New Zealand’s cities and towns. New Zealand Productivity Commission

Funders

Productivity Commission of New Zealand