In Aotearoa, the combination of rising inflation and an economic downturn is prompting about half of Kiwis to consider taking on second jobs. A recent survey from Robert Half reveals that 48% of the workforce is actively seeking additional employment to manage the increasing cost of living, driven by soaring rent and everyday expenses.
The rising trend of moonlighting is gaining momentum, reflecting the broader economic difficulties the country is experiencing, particularly high inflation and a contracting economy. A recent survey by Trade Me Property shows that nearly 70 percent of Kiwis are unhappy, facing a myriad of challenges, including the housing crisis and climate change.
This grim reality offers business leaders a chance to reconsider how they can effectively support their employees, many of whom are driven to seek additional work out of necessity.
Worries Among Employees
The survey highlights the concerns of many workers, especially those in low-to-middle-income households. Nearly 58% of respondents in this demographic are considering extra employment. Young people aged 18-34 are particularly affected, with 65% of them looking at second jobs to help with financial pressures.
Urban areas, especially cities like Auckland and Wellington, show a high interest in side jobs, as 62% of urban respondents cite the high cost of living as a significant factor.
Daily Expenses Take a Toll
Managing daily expenses has become a major concern for many New Zealanders. This growing anxiety is pushing Kiwis to seek additional income. A significant 72% of those surveyed report struggling with rising costs for essentials such as food, rent, and transportation. Many also face mounting debt, adding to their financial stress.
Rising Costs and Stagnant Wages
Currently, New Zealand’s inflation rate stands at 6.7%, which is putting extra pressure on household budgets, particularly in areas like food and housing. Rent has increased by 8.5% in the past year, making housing affordability a pressing issue.
Property investors are also facing challenges with negative rental income, complicating the financial landscape. Additionally, working professionals are not the only ones experiencing the impact of inflation but also those who are working in other sectors such as agriculture, at the moment sheep farmers, are also dealing with high input costs and weak global demand.
Economic Challenges and Job Market Pressures
The New Zealand economy contracted by 2% in the second quarter of 2024, narrowly avoiding a recession. This contraction has significantly affected consumer confidence, which has dropped by 15% since the start of the year, leading to increased job insecurity across various sectors. Skilled labour shortages in areas like healthcare, engineering, and technology have left businesses struggling to fill key roles, adding to the burden on current employees. Many are now looking for second jobs to stabilise their finances amid these uncertainties.
Talent Drain and Worker Exodus
The country is also facing a talent drain, which adds to labour market challenges. Over 25,000 skilled professionals left New Zealand last year in search of better opportunities, according to the Ministry of Business, Innovation and Employment (MBIE). This exodus of Kiwis looking for greener pastures mostly in Australia or overseas has placed additional pressure on those remaining, many of whom are taking on extra work to ensure financial security.
Technological Changes Affect Job Security
While New Zealand is adopting technology to enhance its economy, the rise of AI and automation is creating job market uncertainties. A report from the New Zealand Productivity Commission indicates that up to 30% of jobs could be automated in the next 20 years. This shift might create opportunities in white-collar sectors, but it also poses significant challenges for those in lower-skilled positions. Many of these workers may need to seek additional employment or retrain to adapt to these changes.
Consumer Confidence and Financial Anxiety
As economic pressures mount, consumer confidence has hit near-historic lows. The ANZ Bank reports a 20-point drop in its consumer sentiment index since January 2024, leading households to cut back on spending and increase savings. This tightening of personal budgets is a key driver behind the growing need for extra income.
Implications for Employers
The rise of employees taking on second jobs creates challenges for business owners, especially in terms of productivity and employee well-being. A Workplace Relations survey revealed that 65% of employees feel overwhelmed by the need to juggle multiple jobs, which can impact their performance in their main roles. This situation raises concerns about employee burnout and retention.
Kiwi business owners might need to rethink their compensation strategies to address these challenges. Research shows that companies offering competitive wages and benefits tend to retain talent better, with some reporting a 25% reduction in employee turnover. As financial pressures rise, businesses that fail to adapt may struggle to keep their workforce engaged and motivated.
A Supportive Path Forward
Here are some ideas to help reduce financial stress that many Kiwi workers are experiencing. Businesses could consider offering wage subsidies or adjusting salaries to keep up with living costs. Additionally, they can create a more supportive work environment by providing flexible working options and investing in training programs to help employees gain new skills.
By implementing these solutions, business leaders can create a more supportive and inclusive workplace. This can help ease financial stress for employees while keeping them productive and happy.
Conclusion
The trend of Kiwis seeking second jobs highlights the significant financial challenges facing the country. As inflation rises and job security remains uncertain, both employees and employers must adapt to these evolving economic conditions to ensure long-term stability and success.
Business leaders can help alleviate the pressures their employees are facing by offering competitive wages and offering a helping hand when by prioritising the welfare of their staff, businesses can contribute to a more resilient economy and a more secure future for all Kiwis employees.