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How can Auckland build more inclusive economies?

Mihirangi Forbes, MC at the 'Creating Shared Prosperity Through Supplier Diversity' conference (TSI, May 2019)

Auckland, like many other cities across the world, suffers from enclaves of inequality. The economic gulf between Ponsonby’s soy latte drinking elite, and the communities out in Ōtara-Papatoetoe and Mangere-Ōtāhuhu, has only widened in recent years. So how can the city build more inclusive economies? 

Despite Auckland’s rapid economic growth, the fruits have not been shared equally across the region, and it’s time to focus on areas of lower prosperity, notably South and West Auckland. A few organisations, Auckland Tourism, Events and Economic Development (ATEED), along with south-focused Auckland Council partners (The Southern Initiative and Panuku Development Auckland), have begun to plant seeds of economic development into areas of Auckland that are traditionally left out in the cold, or worse, exploited.

Hopefully, by now, even the most leathery of Neanderthals can understand that we do not all have the same opportunities in life, but people in lower socioeconomic areas, and minority groups, are unfairly disadvantaged in the reach for economic success.

Although rampant technological shifts have been promoted as a positive thing for New Zealand’s economy - the tech sector has rocketed up to our third largest export, fostering brilliant success stories, Rocketlab, Xero, and TradeMe - some people are yet to feel the reverberations of this tech boom.

At the Future Ready Summit 2019, held in south Auckland, Xavier Black and Anna-Jane Edwards, social intrapreneurs at The Southern Initiative (TSI), put it strongly: “South Auckland people haven’t fared well with technological development. Equally, when there are economic shifts, south Auckland gets disproportionately affected by that.”

Unfortunately, there is no silver bullet on how to build inclusive cities in which everyone - regardless of race, age, gender, or ability – can prosper. But there are incremental ways to tackle urban inequality.

Firstly, ATEED has acknowledged the problem. “The gap between those who are doing well economically and those who aren’t is growing. That is very apparent in Auckland, especially for those in the west and in the south,” chief executive at ATEED, Nick Hill, said.

To set about closing the gaps, ATEED has built an economic tool, The Prosperity Index, to understand the spatial patterns of prosperity in Auckland, providing evidence to help inform priority areas so the best course of action can be taken to ensure inclusive economic development for all Aucklanders.

It measures prosperity across indicators grouped into six domains - skills and labour force, connectedness, demography, business activity, economic quality, and household prosperity - then extrapolates the data to calculate the strengths and weaknesses of each area relative to the rest of the city.

The findings indicate the most prosperous local board areas are Albert-Eden, Devonport-Takapuna, Orākei, Upper Harbour and Waitematā.

The local board areas with the least wealth are all the five south Auckland boards Mangere-Ōtāhuhu, Manurewa, Maungakiekie-Tāmaki, Ōtara-Papatoetoe and Papakura.

The results come as no surprise to Xavier Black, who works every day with the whānau and communities who sit frustratedly at the bottom rungs of The Prosperity Index.

Anna-Jane Edwards, Social Intrapreneur, The Southern Initiative (TSI), presents at the Future Ready Summit 2019 (ATEED, 2019)Anna-Jane Edwards, social intrapreneur, The Southern Initiative (TSI), presents at the Future Ready Summit 2019 (ATEED, 2019)

“There is a long history of things being “done to” specific communities that have a history of negative statistics. Mostly the problem is not due to the fault of an individual, but rather the way in which our broader society systematically creates barriers for some people.”

Black continues to say that historically south Auckland was a hub for manufacturing, but developments in technology have contributed to a shrinking industry and displacement of jobs. This, alongside difficult labour market conditions and some areas of high unemployment rates since the GFC have stagnated incomes in the south.

“Young workers as well as adult Māori and Pacific workers in the South were amongst the hardest hit by the Global Financial Crisis (GFC).  Incomes have stagnated since, due to the difficult labour market conditions which followed including economic restructuring, high unemployment rates and sector-specific issues such as reduced employment opportunities in manufacturing.”

Further, these trends are expected to continue in south Auckland as uptake of artificial intelligence and technology increases.  

“We believe that employers, intermediaries, education institutions and agencies need to provide focused support and investment to enable people who are located in sunset industries to convert to sunrise industries.”

(Left to Right) Natasha Aumua, Owner of Lei Cafe and Beks Vilitau, Ngahere Communities Community Manager, tinker with the in-house 3D printer at Te Haa o Manukau, which is being used to print youth designed and open sourced taonga (treasures) such as tiki and miniature waka (ATEED, 2018)(Left to Right) Natasha Aumua, owner of Lei Cafe and Beks Vilitau, Ngahere Communities Community Manager, tinker with the in-house 3D printer at Te Haa o Manukau, which is being used to print youth designed and open sourced taonga (treasures) such as tiki and miniature waka (ATEED, 2018)

The screen sector in west Auckland:

To stimulate economic growth in these areas, ATEED, TSI, and the wider Auckland Council use findings from The Prosperity Index to inform investment decisions, by either improving a weakness or exploiting a strength.

An example of ATEED harnessing a strength is its support of the developing screen sector in west Auckland. The boot-strapped west Auckland screen industry has been led by Sir Bob Harvey, the Waitakere City Council and now ATEED, which has collectively invested into a new production studio in Kumeu to help the film industry attract capital and talent into the area.

Nick Hill, chief executive, Auckland Tourism, Events and Economic Development (ATEED)

Hill says, the screen sector has wide-ranging possibilities that will support quality employment, from film and production work to jobs in catering and engineering.

“If we can attract film productions to Auckland, particularly in west Auckland there are a lot of businesses who can develop around the screen sector. Given what’s happening with the screen sector globally, it could present a huge opportunity for west Auckland.”

According to ATEED, Auckland’s screen and creative sector has grown at an average of 6.2 percent per annum over the last five years, representing one of the highest growth rates across all sectors, only outpaced by retail (6.6 percent), tourism (7.7 percent) and construction (8.5 percent).

The burgeoning screen industry has been likened to our successful national wine markets, with production/post-production revenue in Auckland increasing 62 percent since 2013 (compound annual growth rate of 10.15 percent). According to Statistics New Zealand, it is now over $1 billion.

ATEED has also helped build talent around the burgeoning screen sector, establishing a traineeship and workshop programme with Power Rangers Productions, which gives students an opportunity to gain real life experience in this industry.

Public transport in south Auckland, plus a new ‘innovation district’:

A perennial challenge for Auckland is to strengthen its public transport network, to connect low-income communities (in the south and west) with jobs in the city centre.

Many hope this is set to come in the form of the light rail -- part of the $28 billion regional infrastructure plan, which will link the city centre with Māngere and the Auckland’s northwest -- expected to be finished in the next ten years.

Hill says, “The underlying model of what is happening around the world, and where Auckland is trying to go, is that we are building transport hubs around places with new development. It’s places like Manukau, west Auckland, and Henderson, which have growing residential developments and tourism services that are located around these transport nodes.”

Although Auckland’s tech culture is often linked to Britomart, Wynyard Quarter and the city centre, ATEED hopes south Auckland will develop its own innovation district.

The GridAKL precinct has served as inspiration for a similar initiative in Manukau, with ATEED working alongside Panuku and TSI to support a new innovation and co-working space, Te Haa o Manukau, designed to stimulate budding entrepreneurship in south Auckland.

Hill says, “Those who have developed the co-working innovation precinct in Wynyard Quarter have helped developed a similar model in Manukau. That’s an example of where we have taken infrastructure in the city centre and applied it to Manukau.”

Moreover, it hopes to strengthen Māori business by supporting the independent Whāriki Māori Business Network, where business owners, entrepreneurs and professionals meet at least six times a year at locations around Tāmaki Makaurau with the hopes of growing a strong enterprise culture.

Moving from consultation points to positions of power:

Although local government agencies such as the Auckland Council and ATEED are improving the involvement of mana whenua, iwi groups, and Māori and Pacific peoples, in the consultation process of urban plans, it’s all too often boardrooms and decision-makers are still largely made up of old white people.

Black says, “Firstly, Māori and Pacific communities need to be leading the dialogue. For this to be genuine, we need to share power. Not just consulting, but hand over decision making and budget on key economic decisions.  At TSI, we have a keen focus on using the unique strengths and attributes of our communities to create positive change.”

Asked if there needs to be a shift of skills in south Auckland to enable more access into business communities, Black disagreed, stating that the skills of many of our young people already align to the future of work. 

“When we work with young people from south Auckland, we know them to be creative, imaginative, and pioneering in how they understand and use technology – all skills likely to be required in the future of work.

“The question subsequently becomes how do we support businesses and employers to fully appreciate and leverage the talent and skills of young people already sitting in south Auckland.”

Therefore, to build an inclusive economy requires a combination of infrastructure and cultural changes, to include everyone at the table (and allow for minority groups to sit at the head of this table), to use creative solutions, and to invest in people through equitable housing and transport networks. Although Auckland has some way to go, efforts in the public and private sector, from those such as ATEED, TSI, and others, are showing that there is potential to move towards an inclusive economy that benefits everyone, not just those in the city centre.

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