Cyclone Gabrielle, climate change, and the future of work

Even before the January flooding and February’s Cyclone Gabrielle, climate change had begun to influence the future of work landscape in Aotearoa New Zealand. As the climate warms, we can expect an increase in severe weather events, further influencing how we do business and the skills required in the workforce.  

Initially, the Ministry of Business, Innovation and Employment anticipated that the impact of Cyclone Gabrielle on Hawke’s Bay’s workforce would be significant. However, six months later, labour markets in the worst-hit regions appear remarkably resilient. 

Aotearoa New Zealand’s unemployment rate for the June 2023 quarter was 3.6 percent, with unemployment in the cyclone-hit regions of Gisborne and Hawke’s Bay at 3.6 percent, and in Waikato (including Coromandel) at 3.8 percent. Northland is slightly higher at 4.7 percent, although this is down from 5.3 percent in the December quarter before the cyclone hit.

Regional unemployment rates for Māori and Pacific Peoples in June 2023:

• Gisborne and Hawke’s Bay – 6.3 percent for Māori (down from 9.9 percent in March, and 8.3 percent in June 2022); 3.8 percent for Pacific Peoples (down from 5.3 percent in March, and 12.7 percent in June 2022)
• Waikato – 8.8 percent for Māori (down from 12.6 percent in March, and up from 4.8 percent in June 2022); 10.1 percent for Pacific Peoples (down from 11 percent in March, and up from a low 1.7 percent in June 2022)
• Northland – 8 percent for Māori (down from 8.4 percent in March, and up from 3.4 percent in June 2022); 6.4 percent for Pacific Peoples (down from 10.4 percent in March, and 14.4 percent in June 2022).

Note: StatsNZ has advised caution on interpreting their March 2023 Household Labour Force Survey Statistics for Hawke’s Bay due to disruptions in collection activities.  

In most cyclone-hit regions, the unemployment rate for Māori and Pacific Peoples has fallen since June 2022. This is in direct contrast to national averages, with Māori unemployment in June 2023 at 7.1 percent, up from 5.5 percent. Pacific Peoples’ unemployment was 6.2 percent, up from 5.4 percent, and European unemployment was 2.9 percent, unchanged from last June.  

The underutilisation rate is equally important as the unemployment rate. It indicates a broader measure of untapped capacity in the labour market. Aotearoa New Zealand’s underutilisation rate in June 2023 was 9.6 percent (up from 9.3 percent last quarter). The underutilisation rate in cyclone-hit regions over the past year has been stable, currently sitting at 11.5 percent in Gisborne and Hawke’s Bay, 10.1 percent in Waikato (including Coromandel), and 13.4 percent in Northland.

These latest unemployment statistics indicate a strong and resilient economy. Broadly, Cyclone Gabrielle-affected regions have seen positive job growth over the past year, showing the continued strength of labour demand.

What this labour market data does not show us is how industry and business needs are shifting as both our climate warms and consumer demands change. The future of work is constantly being shaped by megatrends, including climate change, which presents both risks and opportunities. We are already seeing new and different jobs emerge, and with that comes a demand for new skills and knowledge. Long-term economic and industry planning presents many challenges, as well as opportunities for innovation.  

The World Economic Forum’s most recent Future of Jobs report showed green skills are in high demand globally. The report also stated, however, that skills gaps and an inability to attract talent are the key barriers to transformation, showing a clear need for training and reskilling across industries.     

The response to Cyclone Gabrielle has come up against critical specialist skills shortages, which are being filled, in part, by attracting specialist migrant workers, including engineers and technicians.

In the long-run, how well Aotearoa New Zealand manages will be a function of how effectively we build an economy resilient to a changing climate. Investments in green transition and climate mitigation, along with increasing consumer awareness of sustainability issues, will drive industry transformation.  Climate-positive business practices and policies will provide our economy with a competitive edge while creating long-term employment, business, industry, and environmental stability. It is an opportunity to build and develop sustainable business models and practices, and a more resilient infrastructure that supports long-term economic growth.  

The rebuild from Cyclone Gabrielle is underway. But the work to create an economy that can cope with longer-term climate change has just begun.