That said, it’s the long-run issues that really, ultimately matter for Auckland business, generically speaking. In this regard, the question is around what sort of businesses — lots of businesses making up entire sectors — will deliver us higher standards of living and greater productivity over time. As economist Paul Krugman famously once said: “In the long run, productivity is nearly everything.”
In our report, Auckland’s Path to Becoming a Global Tech Hub, the Auckland Business Chamber and others like 2degrees and Deloitte attempted to answer this.
I am not going to repeat the report; it’s easy to find online.
But, in summary, it made a case for the Government and business working together to grow our already successful tech sector in Auckland with a plan, greater intentionality, and focus on sub-sectors in which we already lead — CreativeTech, FinTech, and HealthTech.
As stated, the tech sector is already a success, with pockets of world-class excellence. Overall, it contributes an impressive $13.6 billion to regional GDP and more than $250,000 in revenue per employee. Right now, there are roughly 11,000 tech companies in our city and 120 of New Zealand’s top 200. But all of this is an argument for more, to supercharge and not to rest on our laurels.
An experienced businessperson once said to me that many business boards make the mistake of spending all their time and effort on a minor problem in the company when actually the vast majority of time should be spent on making what is going great go even better. The same is true for Auckland, I reckon.
Tech is already New Zealand’s number two export, and the Government has an ambitious goal of doubling our exports within a decade. Isn’t where the effort should go, therefore, relatively obvious? Let’s be focused and intentional on growing the tech sector to numero uno.
In Auckland’s case, on some measures, it already is. But we need to be clear on locking this in so we create the conditions for supporting it — and the plan that will be required — as it grows more and more.
Tech can and should be Auckland’s clear number one sector by 2030 so we can enjoy the standards of living and productivity levels we talk about and aspire to. Let’s go for it.
Health Tech — think telemedicine, wearables, analytics, and diagnostics — is a US trillion-dollar industry and an apposite example of what I am talking about. In 2010, the sector’s value in New Zealand was $770 million, but today, off the back of Fisher & Paykel Healthcare, Orion Health, and 180 startups and emerging companies, it’s more than $2b.
Already, there is a HealthTech ecosystem in the Grafton, Newmarket area with universities (and a medical school), a top hospital, and a suburb in which many of the businesses locate themselves. This co-location is a necessary precondition for bigger growth and success. However, let’s not pat ourselves on the back just yet.
What is now needed is greater public-private partnership. Specifically, something like a HealthTech precinct where the businesses, the public health, and higher education organisations mix, mingle, co-operate, and co-create to a greater degree than ever before. This will require Government leadership.
For us involved in writing our report, the next step is probably seeking to craft the recommendations we made across CreativeTech, FinTech, and HealthTech into work that can be included in Auckland’s “city deal”. This deal (or really series of them) will, of course, include the top-of-mind issues like crime, cost, and infrastructure, and so it should. At the heart of tech is talent, and talent won’t come, play, and certainly won’t stay if the city isn’t safe, affordable, and easy to get around.
But possibly even more important is the tech deal component. It is the best answer we have, right in our hands, to our long-run issues of living standards and productivity.
A world-class tech hub would ensure we are the world-class city, which some of us believe we are, and all of us aspire to live in.
See the report here.
· Simon Bridges is chief executive of Auckland Business Chamber.
· Auckland Business Chamber is an advertising sponsor of the Herald’s Project Auckland report.
