Troubled times in Wellington threaten our future digital success

This week's news of the government's cost-cutting measures sent a shiver down the spine of many, particularly those in the tech sector. It is emerging that the requested 7.5% reduction across agencies translates to thousands of public service jobs on the chopping block, with a concerning emphasis on "back office" roles – a term often used as a euphemism for digital specialists.

Source: https://www.needpix.com/photo/524170/

Earlier this week I hosted an ITP Member coffee catchup here in Wellington. While enjoying coffee and snacks in my sunny office, a concerning trend emerged. Among the roughly 15 attendees, many expressed anxieties about their job security. About half were recently out of work due to sudden post-election contract terminations or worried about upcoming restructurings within their organisations. Most were employed by the private sector who are a casualty of the government ceasing many projects.

Here is a summary of the collective concerns expressed by this group.

Brain Drain across the Tasman

New Zealand's tech talent pool is precious. We can't afford to lose experienced workers, especially to our trans-Tasman neighbours with their ever-growing tech scene. These job cuts could push skilled individuals to seek opportunities in Australia, weakening our digital workforce at a critical juncture.

A Workforce Disappearing Act?

It is reasonable to expect after a settling in period the government will press go on projects again. But where will the resources come from then? The very people with the expertise to deliver those projects might have moved on – leaving a scramble for talent and potentially delaying vital initiatives.

Cutting the Wrong Branch to Improve Efficiency

The government's stated goal is "doing more for less" – a textbook example of where digital transformation shines. Cutting the very people who can streamline processes, automate tasks, and improve efficiencies seems counterintuitive. Investing in digital solutions can free up valuable resources for frontline services, ultimately improving outcomes for citizens.

Digital Transformation: A Missed Opportunity

Beyond cost savings, digital government has the power to transform citizen experiences. Imagine seamless interactions with government services, personalised support, and faster access to information – all driven by innovative tech solutions. These are the possibilities we risk sacrificing with short-sighted cuts, the group was very clear that this might just be the crisis to force a rethink - move away from the silo’d approach, architect a digital transformation for the whole of government.

A Ripple Effect on Wellington's Economy

This decision has a flow-on effect beyond the public sector. The private sector, already impacted by government cuts to major programs list 3 Waters, will also face a talent shortage as the tech workforce shrinks. Wellington, a hub for government and the tech sector, could see a significant downturn in its economic activity.

As one of my guests said “it’s ironic the one person in control of these cuts is also complaining about Wellington losing it’s swagger”, referring to the comments made by Nicola Willis earlier in the week.

Lessons from the Past: The GFC Brain Drain

History offers a cautionary tale. The Global Financial Crisis (GFC) of 2008 saw skilled professionals migrate from countries with struggling economies to those offering better opportunities. Ireland, for example, witnessed a significant exodus of young talent, hindering their economic recovery.

We have seen a flight across the Tasman post Covid already.

A Call for a Smarter Approach

At the end of the day the group I met were really concerned that New Zealand can't afford to repeat these mistakes. We need a long-term vision that prioritises a skilled and adaptable workforce, particularly in the digital space. Increasing invest in digital transformation and embrace the efficiencies it offers - which will in turn lead to “doing more for less”. Let's create an environment that attracts and retains top talent, not one that pushes them away.

The future of our digital economy and Wellington's prosperity hangs in the balance. It's time for a smarter approach.