Heading for the sun: Chasm widens as Auckland grows

A chasm is opening up in New Zealand society between Auckland and almost everywhere else.

In the first Census of last century in 1901, people and jobs were spread fairly evenly from North Cape to Bluff. Just 9 per cent of Europeans lived in Auckland, comparable to the other three "main centres" of Wellington (6 per cent), Christchurch and Dunedin (7 per cent each).

As late as the 1960s, says Waikato University demographer Ian Pool, "a working-age British migrant was just as likely, then, to take up a job in Invercargill or Gisborne as in Auckland".

Today that balance has disappeared. Throughout the past century, except for a pause in the 1930s Depression, Auckland's share of the population has grown relentlessly to the point where 30 per cent of us now live in one big primate city.

Wellington and Christchurch (both 9 per cent) and Dunedin (3 per cent) have been relegated to a second league with Hamilton (5 per cent), Napier-Hastings and Tauranga (both 3 per cent).

Almost two-thirds of the country's top 200 companies are now headquartered in Auckland, up from 40 per cent as recently as 1986. And with people and power has come income: Aucklanders now earn an average of $22 an hour, against $21.50 in Wellington, $19 in Christchurch, $18 in other cities and $17 in rural areas.

Waikato demographers Sandra Baxendine, Bill Cochrane and Jacques Poot describe a "chasm that has developed in New Zealand between metropolitan and other services-oriented regions vis-a-vis rural and peripheral regions".

"A decline in manufacturing, and growth in the ... 'quaternary' sector [business and financial services and other knowledge industries of the 'new' economy] have shaped employment outcomes that are confirmed by clusters of prosperity and disadvantage," they write in one of a series of new reports funded by the Foundation for Research, Science and Technology.

In another report, they describe the backwash effects as income and jobs were sucked out of places such as Wanganui and Gisborne to feed Auckland's growth after the economy was deregulated in the 1980s.

"Two or three regions prospered, some stood still, but some suffered the development of under-development," they write.

"Auckland and Wellington gained disproportional and increasing tranches of the national personal income. In this regard, every other region was proportionately disfavoured."

Auckland has been our biggest city since it pulled ahead of Dunedin in the mid-1880s, when the final subjugation of the Maori opened up the North Island's lush volcanic soils to European farmers.

Its twin natural harbours and its northern location make it our natural gateway. Today 62 per cent of our imports and 31 per cent of our exports by value flow through Auckland. Seventy per cent of visitors arrive there and 34 per cent of visitor nights are spent in the region.

These international links have become increasingly vital as barriers to trade, investment and migration have tumbled in the past 20 years.

"When Fonterra was formed from a number of smaller companies based in different parts of the country, there was a logic in being in the most globally connected point in New Zealand and that would be Auckland," says Auckland University geographer David Hayward.

Once the process began, 120 years ago, success bred success. Companies located in Auckland to be close to their customers and suppliers and to tap into the city's labour market.

Workers were attracted to the city's bright lights, specialised jobs and diversity. Only in Auckland are there enough people from many ethnic and other groups to sustain their own restaurants, food stores, cultural and religious activities and media.

Deregulation in the 1980s and 1990s hastened the process. Wellington bureaucracies such as the Railways, Electricorp and the old NZBC were reborn as lean Auckland corporates such as Toll, Genesis, Mighty River Power and TVNZ. Protected industries such as car plants in Lower Hutt, Porirua, Thames, Waitara and Nelson shut, and businesses that survived in the new free market consolidated near their customers - in Auckland.

As manufacturing followed the same path as farming and forestry, replacing men with machines or moving to China, the new growth sectors became "knowledge-based" and "creative" industries such as education, biotechnology, films, new media and software, typified by fuelcard company Cardlink.

Auckland University geographer Ward Friesen says these industries also cluster together in big cities, near knowledge centres such as universities, sharing skilled people who often move between companies on short-term projects.

Waikato's Jacques Poot says "power couples", where both partners work in knowledge-based industries, migrate to big centres so both can find work in the same place.

"This is not a unique thing to New Zealand. People talk about a global network of these megacities," he says.

"Auckland is a small player in that market, similar to a middle-sized provincial city in China. But we are linked in the Asia-Pacific Rim and those interactions are strengthening."