Fear becomes infectious in Wellington
Between public sector job cuts, stalled transport projects, businesses closing down and plummeting house prices, it’s fair to say Wellington is in need of more than just sunshine to enjoy one of its quintessential “good days”.
More than 2000 jobs have been axed so far from the public sector as the Government seeks savings ahead of Budget Day. Wellington will be hardest hit by the losses, with 44.5 per cent of public servants based in the capital — about 28,000 fulltime equivalent positions.
Latest data from Trade Me Jobs shows the cuts are already having an impact on Wellington’s job market, with the average salary down 3.3 per cent on the previous quarter — the biggest percentage drop across every region in the country. Wellington also had the biggest drop in job listings year on year, with those for roles in central government down a massive 77.2 per cent year on year.
House prices have slumped more in the capital than anywhere else after peaking in February 2022.
By November last year, Wellington had officially recorded the largest decline, with house values dropping 25 per cent. In December, the median house price in Wellington was $790,000, down 20.2 per cent on the year before. It’s not clear yet what impact mass job cuts will have on the market.
Plans to revolutionise travel in Wellington and across Cook Strait have been scrapped, with the Government pulling the plug on both Let’s Get Wellington Moving and KiwiRail’s iReX project.
It has committed to building a second Mount Victoria tunnel but is also revisiting a mega tunnel proposal stretching from The Terrace to Kilbirnie. It’s unclear which will actually get built.
Wellington City Council is still wanting to remove cars from the Golden Mile despite fierce opposition from businesses. Last week, Cranfields owner Nicola Cranfield announced she was shutting her shop after 33 years. She blamed the proposal, saying she was tired of fighting the plan and living with the uncertainty of when it might happen.
Finance Minister Nicola Willis was recently asked in an interview if she was the reason for Wellington’s sour atmosphere, owing to her directive to trim the public sector. She denied it, saying people were talking themselves down into the dumps. She could have a point, but that’s not because of a negative mindset amongst residents, but because of ongoing uncertainty crippling any chance of progress.
Once one project is canned, one business shuts shop, one house fails to sell, one family loses its income, people get spooked. They don’t take on risk, fork out for a big purchase, invest in the area.
There’s no one factor or person to blame for the downward spiral Wellington finds itself in, but the spreading fear is becoming highly infectious.
If those in charge really want to take control, drive economic growth and be recognised for their decisive leadership, then people need confidence about what lies ahead.
The sooner decisions can be made on major infrastructure projects and the extent of job cuts in the public sector, the better.
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