The 'T' word: Talent in New Zealand

‘Talent’ has been a topic high on many leadership agendas since our borders closed in 2020. While it was ranked as one of the lowest risks for the rest of the world, talent was joint fourth in a list of the most pressing concerns for New Zealand CEOs alongside both climate change and political uncertainty.

Our local leaders are also more concerned than their global counterparts about the ability to retain talent given inflationary pressures and the rising cost of living. 43% of New Zealand CEOs surveyed strongly agreed this would have an impact on their organisation in the next three years, versus 21% of global CEOs.

But CEOs in New Zealand feel they need to balance this concern around retaining their people with wider economic uncertainty. 90% of executives in New Zealand say they have or will implement a hiring freeze in the next six months in case of a recession, while internationally this sat at 75%. Sales pipelines will likely be under increasing scrutiny as leaders grapple with the battle for top talent and fiscal pressures that may – or may not – hit in the coming months.

Forecasting their organisation’s headcount, however, implied some stability. Only 3% of local leaders expect a decrease in headcount in the next three years and 63% expect it to increase. This expectation for growth is tempered somewhat by the third of CEOs who anticipate their workforce staying the same over this period.

So how are executives planning to retain their people?

Purpose: In New Zealand, CEOs appear to view corporate purpose as more impactful for their employee value proposition (EVP) than the international average; 47% consider their purpose very important in strengthening their EVP compared to 19% globally.

This trend also holds true for the drivers behind greater ESG transparency and reporting. 40% of Kiwi CEOs believe employees and new hires are putting the greatest pressure on their organisation to be better in this area, above regulators, investors and customers. People are holding their organisations to account on ESG in New Zealand.

Flexible working: When asked about the impact of hybrid working, New Zealand CEOs were twice as likely to think this flexibility has had a positive effect on employee morale (80% vs 41% globally). It’s a similar story with retention; 63% of Kiwi leaders see a positive impact from flexible working compared to 38% globally.

This discrepancy in opinions might be linked to how Covid-19 affected New Zealand in particular. For example, hybrid working was less common in New Zealand than in some other parts of the world before the pandemic, so we are newer to the benefits of flexibility. Furthermore, longer lockdowns in some jurisdictions meant working from home became more restrictive than flexible. The border restrictions in New Zealand have also meant that the ability to connect virtually rather than depend on travel has been critical – this may also explain why 47% of New Zealand CEOs think hybrid working has had a positive impact on collaboration and innovation. We have seen this in our own organisation, with a significant number of people taking advantage of our ‘Work from Overseas’ arrangement which allows them to travel or reconnect with family while still maintaining productive working relationships and schedules.

Leaders should consider the importance of this flexibility when planning ahead

Contrary to the benefits noted by the majority of Kiwi CEOs, 93% expect that corporate employees with traditionally office-based roles will be office-based in three years’ time. Only 7% anticipate their workers will be in hybrid arrangements. This would indicate that the CEOs believe flexible working was a reaction to Covid-19 versus a change in long term workforce trends. This belief is counter to what we are hearing from our people and wider global trends. With flexible work now seen by many workers as a core EVP offering, CEOs who force a move back to office work may find it difficult to attract and retain the local and international talent their firms need to grow. 

This article is from KPMG New Zealand's CEO Outlook 2022. 

About the authors

Evan Bateup has over 15 years of experience as a People Executive with expertise in culture change, attraction/retention strategies, employee experience and Inclusion & Diversity. While his career has primarily been in People and Culture, he has also held positions in marketing, sales, programme management, change management and operations.

Evan hails from Northland - Kawakawa, Kaikohe and Kerikeri, but calls Paihia home. He presents as authentic and strongly values-based. His empathy and respect for people of all walks of life are evident, and you get a sense of his energy, creativity and focus on strategy and improvement when speaking with him.

Helen Mason spent 30 years working in the construction industry in the UK and Europe before finding her niche at KPMG in NZ as Head of Talent and Mobility.  She gained her experience working in Design and Change Management and as Estimator on significant construction projects in New Zealand and across the world. She has a passion for people and since joining KPMG nearly five years ago, Helen has project managed and delivered transformational change initiatives in Internal Mobility and Talent Acquisition. 

Helen leads a team of talented specialists who ensure we secure the best talent for KPMG and that we provide existing people with internal and global mobility opportunities within the KPMG Global Network.