Education and health are Dunedin’s two largest industries, and a solid proportion of the staff being shed are administrative folks; where are they going to get their next job from if the employers that hire most of the administrators are letting them go?
It’s the problem of having large, government-supported industries at the heart of our local economy. When government needs to tighten its belt, Dunedin goes on a diet.
It doesn’t matter that elsewhere the economy is overheating, and that those of us with mortgages are getting the same interest rate increases as Auckland.
The double-whammy, of course, is that those families affected by these major restructures are having to cope with huge changes in their immediate futures, all while food inflation is running at 12.1%. Higher than any time since 1987 (when GST started).
But that misses the severity of the situation. Fruit and veges are up 22%!
A floating mortgage is now at 8.6%, compared with 5.2% this time last year. If you had the average mortgage of around $250,000 (in Otago) your payments would have increased by just under $250 a fortnight.
If you got a 5% increase in your wages this year and you wanted it to cover this uptick in your mortgage, you’d have to be on nearly $200K a year before tax.
Which is not, by a long shot, the average salary for admin or office staff in Dunedin.
The cheerfulness doesn’t end there though. All those folks being made redundant at around the same time have got some major life choices ahead. It’s no surprise that immediately spending a lot less on retail goods (Dunedin’s third-largest industry) while they figure through their options will be close to the top of the list.
For Dunedin’s sake, we’ve got to hope that the belt-tightening works, and quickly.
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