The population is changing, so are businesses keeping up? Photo / Getty Images
ANALYSIS
ANZ chief executive Antonia Watson recently noted that in the near future, 35 per cent of the potential workforce under 14 will identify as Māori.
“If we haven’t got pathways for them to come into the workforce and get to the senior roles, then we won’t have any workers left,” Watson told the Front Page podcast.
“It’s really important to understand the demographic make-up of New Zealand and where we’re going, because we need to make sure that our organisations are thriving in the future.”
This was a stark warning to New Zealand’s changing demographic makeup means that businesses will need to put the building blocks in place now or risk facing a talent crisis in the future.
New Zealand demographic statistics show that the percentage of New Zealanders aged 0-14 declined from 20.8 per cent of the population in 2011 to 18.9 per cent in 2021. Meanwhile, the percentage of people aged 65 and older increased from 13.26 in 2011 to 15.9 per cent in 2021.
Population projections anticipate that in the coming decades, 20 of every 100 New Zealanders will be older than 65.
The debate about giving better opportunities to Māori and Pasifika is often framed as an act of taking something away from Pākehā, but businesswoman and chair of not-for-profit organisation Global Women Theresa Gattung says this couldn’t be further from the truth when you look at where the country is headed.
“The demographics are clear: the population is ageing,” Gattung says.
“But the Pakeha fertility rate is much lower than the Māori and Pasifika rates. Currently, only 25 per cent of those over 65 are still in paid employment – and even if you believe that percentage may increase over time and that more of us will keep working, you’ve still got a situation where it’s a largely Pākehā older population and largely younger growing percentage of Māori and Pasifika.”
Gattung says that based on those projections, it would be foolish for the country to maintain the status quo that will ultimately see a growing section of the population left behind.
The economist Shamubeel Eaqub took this notion a step further by saying that in the future New Zealand faces the reality of an ageing Pākehā population that’s basically funded and supported by the taxes of young immigrants and brown people.
“The population is changing and we need everyone of working age to be engaged,” says Gattung.
“Māori, Pasifika, Asian, they all have to feel like they belong. That they can bring their best selves to the workplace. New Zealand is set up for a lot of problems if we don’t acknowledge that reality.”
The problems that need to be addressed are reflected in the stats emerging from New Zealand’s major businesses. A recent report from Champions of Change showed that Europeans make up 77 per cent of all board-level roles at some of New Zealand’s top companies, compared to only 5 per cent for Māori and 2 per cent for Pasifika. This is despite the fact that Māori and Pasifika make up nearly a quarter of the overall population.
The divide is even more stark when you dig into the data on Māori and Pasifika women in business.
“The gender pay gap has been stubborn at just over 9 per cent for over a decade, but the gender pay gap for Māori and Pasifika women is more than double that. The biggest pay gap is for Pasifika women, who earn 75 cents on the dollar.”
An open letter delivered to Parliament in March called on the Government to enact legislation requiring transparency from businesses on the pay gap. RNZ reported that the letter was signed by 51 businesses, unions and other groups, with the likes of ANZ bank, Sky City, and DB Breweries among the signatories. Equal Employment Opportunities Commissioner Saunoamaali’i Karanina Sumeo has been a major advocate for this move, saying it would offer transparency for everyone, including disabled workers, abled workers, Pasifika, Māori and across genders.
Best person for the job?
Critics of providing equal opportunities across gender and ethnicity often point out that businesses should instead just focus on hiring the best person for the job. This argument is fair enough, given that businesses do need to have the right to hire the best possible person for the job. But are businesses really considering the full extent of available talent when making their hiring decisions?
This was a question that Vaughn Davis, a marketing commentator and founder of ad agency The Goat Farm, recently pondered in a LinkedIn post looking at the gender imbalance among pilots.
When Davis graduated from the RNZAF pilot training programme in 1988, there was one woman who graduated from the course: Angie Dickinson, the country’s first female Air Force pilot.
Fast-forward to last year’s graduation and there were no women, only eight men. Davis expressed the view that this wasn’t a good thing, leading to sharp backlash from those who argued that the country should just focus on hiring the best possible pilots for the job.
Davis responded with a thought experiment called ‘the endless queue’ which explains why sexism and racism are bad for business.
“Imagine we could line up all the people who could possibly become Air Force pilots, rated from the very best, then the second best, all the way down to the most useless,” writes Davis.
“In an endless queue – or even a decent-sized one – half of the potential pilots would be men and the other half would be women (give or take people who identify as neither or both). It wouldn’t be boy-girl-boy-girl like a dinner party seating plan, but over the length of the queue it would even out.”
He explains that based on simple statistics it becomes less and less likely that every single person at the front of the queue is a man, the further you go down the line. He drives home this point by referring back to the case of our eight male pilots.
While there’s a 50 per cent chance that the person at the front of the queue is a man, the chance of everyone being a man plummets the further you go.
“Binomial distribution tells us that by the time we get to the 8th person in the queue, as the Air Force did, the chance of them all being guys is 1 in 128, or 0.7 per cent.”
If you had to extrapolate this across the wider workforce by looking at the makeup of most boards in New Zealand, it quickly becomes evident that our search for talent probably isn’t always as objective as we’d like to think it is.
Forward-thinking
In confronting the tough challenges ahead, Gattung urges business leaders to be more open-minded rather than defaulting to a combative stance and trying to protect their turf.
“Be open to what we might be able to create in the future,” she says.
“I think we can get a bit hung up on words like co-governance. I don’t even like to say it, because it’s so politically charged. I mean, just park that. Whatever you believe about the Treaty, whether it’s the Māori of the Pākehā version, whether we’ve gone too far in reparations or not far enough isn’t the focus in this.
“It’s really about now and the future. How do we want to be in this country? Surely we don’t want the future we’re seeing in the United States with its deep division. Surely we want to actually bring out the best in what’s possible for all of us who have chosen to live here.”
These are hopeful words, but they implicitly require businesses to become less defensive and open up to the reality that there might be a better way to do things – and that’s even harder to do when you’re facing enormous economic pressure.
Damien Venuto is an Auckland-based journalist with a background in business reporting who joined the Herald in 2017. He is currently the host of The Front Page podcast and also writes columns and articles, often focused on the intersections between business and creativity.
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