Contents Page: NZJER, 2005, 30(2)
Name

Title

Bruce Curtis and Steve
Matthewman

The Managed University: thePBRF, its impacts and staff
attitudes
Ruth Nettle, Mark Paine & The Employment Relationship – aJohn Petheram
conceptual model developed fromfarming case studies

Page
Number
1-18

19-36

Bernard Guerin, Pauline
Guerin, Roda Omar Diirye& Abdirixak Abdi

What Skills do Somali Refugees
Bring with them?

37-50

Paul Callister

Changes in paid working hours forcouples,
1986 to 2001

51-64

Philip S. Morrison &Elizabeth Loeber

Youth Transition and the Local
LabourMarket65-83

Erling Rasmussen & Colin
Ross

Chronicle: May-June 2005

84-89

New Zealand Journal of Employment Relations (2005), 30(2): 1

The Managed University: the PBRF,
its impacts and staff attitudes
BRUCE CURTIS* AND STEVE MATTHEWMAN**

Abstract
This article analyses impacts of the Performance-Based Research Fund that wasestablished in 2003. The fund encourages the entrepreneurial or “managed” university(Becher and Trowler, 2001). Of particular concern to academics is the character of ‘the
HR challenge’ (Walsh, 2004). The article also assesses a survey of academics in thehumanities and social sciences. Although the survey is part of on-going research in thisarea, the results suggest that while staff support traditional forms of academic work they
are not well placed to resist ongoing erosion of their professional control (Abbott, 1991).

Introduction
It has been argued that the managed university and state initiatives, such as the PBRF,
undermine forms of professional control (Abbott, 1991). Such downgrading is bemoaned
as the end of “donnish” dominion (Halsey, 1992) and as proletarianisation (Harvie, 2000).
These changes have also been documented by a range of authors in the international
literature and are typically linked with the introduction of managerialist performanceindicators (Talib, 2003). Although such developments predate the PBRF in New Zealand(Chalmers, 1998; Scott and Scott, 2004), Tipples and Krivokapic-Skoko (1997) emphasise
the psychological components of managerialism in New Zealand from the mid-1990s.
This article, therefore, analyses likely impacts of the Performance-Based Research
Fund (PBRF) on academics, and staff attitudes during its evaluation stage in 2003.
Analysis of the PBRF provides conﬁrmation of a new managerialism in higher educationin general, and in universities in particular. Indeed, the PBRF epitomises state concern
with efﬁciency and economy, and the consequent twinning of declining funding for, andincreasing intervention in the institutions of higher education (Scott & Scott, 2004). In
this respect, local developments parallel those in Australia, Europe and the US (Guena& Martin, 2003; Sporn, 2003; 1999; Talib, 2003). The PBRF is a powerful driver for the
managed university (Becher &Trowler, 2001: 1-22) and, speciﬁcally, its ‘entrepreneurial’
variant (Clark, 1998; Slaughter and Leslie, 1997). This typically entails an emphasis on
research as a form of revenue generation, the downgrading of academic autonomy, the* Dr Bruce Curtis is a Senior Lecturer, Department of Sociology, The University of Auckland.
** Dr Steve Matthewman is a Senior Lecturer, Department of Sociology, The University of Auckland.
This research is in part funded by the University of Auckland Research Fund for the project `Opportunities and Anxieties
in a New Research Culture’.

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2 Bruce Curtis and Steve Matthewman

separation of teaching and research, and the demotion of the former.
The article reports on a survey of academics in the humanities and social sciences wasundertaken to gauge attitudes to the PBRF and other developments. The ﬁrst phase of
the research involved a mail-out survey to all academic staff located in the humanities
and social sciences at the eight New Zealand universities: 1779 questionnaires weresent out and 617 were completed and returned. The questionnaire asked academics:(1) to rate 56 statements in terms of a Likert scale (Strongly Agree =5, Agree =4,
Neutral =3, Disagree =2, Strongly Disagree =1);
(2) to answer opened-ended questions about the most worrying and encouraging
developments for the tertiary sector;(3) to provide some biographical material (age, gender, ethnicity) and a career
proﬁle (years in job, institution, academic rank, discipline, degree).
The survey was completed during the evaluation stage of the PBRF – the Quality
Evaluation – in late 2003. The second phase of the research is ongoing and involves
analysis of survey data, and interviews with academics, university management, union
representatives and staff of various ministries and sector organisations.

Evaluation and the PBRF
The stated goal of the PBRF is: “To ensure that excellent research in the tertiary education
sector is encouraged and rewarded. This entails assessing the research performanceof TEOs [tertiary education organisations] and then funding them on the basis of theirperformances” (Tertiary Education Commission, 2004a: 3). The PBRF allocates fundingon the basis of research quality (Tertiary Education Commission, 2004b: 74-81).
Established in 2003, the PBRF is managed by the Tertiary Education Commission (TEC)
and is the ﬁrst assessment of research quality in higher education, including universities.
This assessment was designated the 2003 Quality Evaluation. The PBRF was worth$18.2 million in 2004 and is scheduled to increase to $194 million by 2009 (Mallard,2005). By 2007, the PBRF will provide one-ﬁfth of government funding to universities(Scott and Scott, 2004). The fund was established from the transfer of monies allocatedto teaching enrolments.
The initial fund was created from 10% of the research component of the existing EFTS
[equivalent full-time student] funding to TEOs. In this respect, the PBRF has not increased
the pool of funding but makes a percentage of it follow an assessment of research rather
than student enrolments. The research component of EFTS funding will be partly replacedby the PBRF in stages: 10% in 2004, 20% in 2005, 50% in 2006 and 100% in 2007. This
will increase the size of the PBRF. From 2007, the ratio between PBRF and EFTS-based
funding will be approximately 20:80 (Mallard, 2005).

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The Managed University 3

The amount of PBRF funding that each TEO receives is determined by its performanceacross three components: a Quality Evaluation (QE), in which multidisciplinary panels
assess the quality of research of academics who are engaged in teaching and who areemployed at the census date for more than a year and at least 0.20 full time equivalents;1
a measure of research degree completions (RDC); and a measure of external research
income (ERI) The ratio of funding for TEOs across the three components QE/ RDC/ ERI
is 60:25:15.
Reifying hierarchies: Institutions, subjects, nominated output units andindividuals
The component of the PBRF exercise given the greatest coverage was the 2003 Quality
Exercise. This made possible comparisons between tertiary education organisations,subjects and individual academics. Much of the material generated by the exercise
has been published (Tertiary Education Commission, 2004b) but a wealth of further
information is yet to be mined.
The most publicised aspect of the Quality Exercise was the ranking of TEOs. This brought
few surprises. Forty-ﬁve TEOs were held eligible by the Tertiary Education Commission
to complete the exercise. Twenty-two TEOs participated and 23 opted-out (itself nosurprise as these institutions were likely to receive no funding beneﬁts from the exercise).
Of the twenty-two that participated there were eight universities (i.e. all New Zealanduniversities), two polytechnics, four colleges of education, one waananga, and sevenprivate training establishments.
The results were predictable: the seven established universities were all ranked higher
than the other TEOs, the newly promoted Auckland University of Technology was ranked
11th (behind 3 Bible colleges with a combined academic complement of 28.5 FTE), andthe colleges of education were ranked last (Tertiary Education Commission, 2004a: 411).
Table 1: University Ranking(Tertiary Education Commission, 2004a: 11)

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4 Bruce Curtis and Steve Matthewman

With hindsight, the University of Canterbury perhaps did better than expected and the
University of Otago a little worse. Nonetheless, the ratings conﬁrmed what was generally
understood to be the academic pecking order: ﬁrst Auckland, as part of a cohort made upof the 4 main colleges of the former University of New Zealand (Auckland, Canterbury,
Wellington, Otago); then Waikato (established 1964) and the former agricultural colleges(Massey and Lincoln); last – and still looking like a polytechnic – the recently promoted
Auckland University of Technology (established as a university in 2000).
As noted, just over half of the PBRF-eligible TEOs constituting a majority of polytechnics,
waananga and private training establishments opted out of the exercise, while all of theuniversities participated. This reﬂects the reifying aspect of the 2003 Quality Exercise
and the vested interests in the process. Insofar as the performance-based researchfund reallocates funding to TEOs with the highest ratings, it is likely to reinforce existing
divisions in resourcing. Indeed, a reallocation towards the universities and away fromother TEOs was undoubtedly the main reason why the New Zealand Vice Chancellors
Committee (NZVCC) played a leading role in developing and implementing the 2003
Quality Exercise (see Barnes, 2004).
Similarly, the potential to reallocate resources towards universities (and away from othertertiary education organisations) accounts for the support of the union, the Associationof University Staff (AUS), which has coverage over academic and general staff in theuniversities. (The signiﬁcant exception is Auckland University of Technology, where
staff remain covered by the Association of Staff in Tertiary Education. The Association
provides coverage for polytechnics. Arguably the funding cuts resulting from AUT’s poor
PBRF performance do not pose a problem for the AUS.) Thus, critical support by AUS for
the PBRF was based on the following considerations:•

The PBRF assessment should clearly distinguish the performance of universities as
research-led institutions, and distribute funding accordingly;•

It should also address the long-standing anomaly of the EFTS-funding system
whereby all providers receive the same funding per student, with no recognition of
the extra research obligations of universities (Association of University Staff, 2002).

Yet, there are signiﬁcant issues around resource allocation within the university sector.
The funding mechanisms introduced by the PBRF will signiﬁcantly advantage someuniversities over others. In 2004 alone, the PBRF will deliver 2.15% more funding to the
University of Canterbury and 4.47% less to Auckland University of Technology (Tertiary
Education Commission, 2004a: 80). This difference will increase as the PBRF deliversa larger share of funding, until 2007 when the scheme will be fully implemented. In thisrespect, the PBRF is likely to reify the existing hierarchy of universities and other TEOs.
This differentiation is an intended consequence:

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The Managed University 5“The PBRF rewards research activities of national and international
excellence. It therefore introduces a powerful new incentive for TEOs
to concentrate their research around areas of excellence. They areencouraged to aim for depth rather than breadth in their research capacity”(Tertiary Education Commission, 2004a: 1).
From the perspective of academics, and of professional control, the differences likely
to be reinforced at the institutional (TEO) level by the PBRF are of a second order.
Any hierarchy of universities per se does not constitute a threat to academic control.
Indeed, it is possible the opposite applies: academic careers typically involve promotions
associated with movements between more and less prestigious universities. Of greater
concern to academics as a profession, is the extent to which the institutional differentiation
reinforced by the PBRF reduces the total options available to them. Academic labour
markets are typically constituted as core and periphery (Connell & Wood, 2002). In thisrespect, a widening gap between the ‘core’ (Auckland, Canterbury, Otago, Victoria)
and the ‘periphery’ (the rest of the universities) is of little concern (cf Morgan, 2004).
Academics should be less sanguine, however, where the process of differentiation
reduces the overall pay and conditions in the sector as a whole, and where some (i.e.,
low rated, poorly resourced) universities use performance measures, like the PBRF, tolever reductions in pay and conditions.
Thus, the separation of teaching and research is a signiﬁcant concern for academics,
and places downward pressure on the overall pay and conditions for the sector. For
example, Auckland University of Technology has introduced elements of this division in
the wake of the PBRF (although research-track academics still undertake more teaching
than counterparts in established universities). More worryingly, the separation of teaching
and research is a viable response to the PBRF methodology only if it also involves thecasualisation of this teaching (i.e., senior tutors on permanent contracts were assessedin the 2003 Quality Evaluation). The move to ﬁxed term contracts in teaching and inresearch has been a central feature of academic work in Britain following the RAE(Collinson, 2002) and seems likely to be used here both for reasons of cost efﬁciencies
and for institutional gaming in readying for future Quality Evaluations. Senior tutors onﬁxed term contracts of less than 12 months would not be assessed under the current
PBRF methodology.
The 2003 Quality Evaluation also generated considerable material on the subjects thatcomprised of academia. The Tertiary Education Commission constituted twelve expert
panels to assess the quality of research of individual academics across forty one ‘subject
areas’. The twelve multidisciplinary panels typically involved around 20 professoriate
academics and included at least one senior academic employed outside New Zealandand one expert in Maori knowledge. The main task of these panels was to evaluate the
Evidence Portfolios of individual academics and to assign a numeric and letter grade (R,less than 200; C 200-399; B, 400-599, A 600-700).2

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6 Bruce Curtis and Steve Matthewman

Three panels covered the range of subjects associated with the Arts: Social Sciences& Other Cultural/Social Studies (6 subjects), Humanities and Law (6 subjects) and
Education (1 subject) (see Tertiary Education Commission, 2004b: 18):
Table 2: Social Sciences & Other Cultural/Social Studies; Humanities and Law;
Education Panels

The ranking of subjects also largely conﬁrmed the commonly accepted hierarchy. As
TEC put it: “In general, the best results were achieved by long-established disciplines

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The Managed University 7

with strong research cultures…” (Tertiary Education Commission, 2004b: 9). However,
the assessment of subjects was made more contentious because of the decisions
concerning the grouping/creating subject areas. Thus, in the Arts at least, the extent towhich a discipline stood alone in a ‘subject area’ was a good predictor of its Quality Score.
For example, Philosophy and Psychology were obvious beneﬁciaries in this delineation,
while the subject area of Human Geography also beneﬁted from its separation from thegeneral ﬁeld of geography. Conversely, disciplines like Sociology suffered from being
bundled with Social Work.
More signiﬁcantly, the problematic grouping of disciplines into subject areas, theconstitution of multidisciplinary panels, and the methodology for assessing andreporting on Evidence Portfolios points to the decidedly minor inﬂuence of academics/
disciplinary practitioners in the development of the PBRF methodology (Peters, 2001a,
2001b). As a result, the 2003 Quality Evaluation provides considerable information forpolicymakers and for senior management of universities, but the beneﬁts to disciplinary
associations and academic practitioners is by no means clear. While the planning ofﬁcesof individual universities are no doubt engaged in the analysis of the PBRF results andstrategising accordingly, the future role of individual academics and their associations
are problematic.
Clearly, the PBRF must have an institutional focus and should measure the extent of
the obligations laid out by the Education Act (1989), section 254(3)(a) that degrees mustbe ‘taught mainly by people engaged in research’. However, the focus of the PBRF
on individual academics as the unit of analysis (Boston, 2004; Web Research, 2004)
also provides a powerful reinforcement of the new managerial imperatives. It must be
noted that while each TEO gains an overall quality score, it is the prerogative of senior
management at each institution to determine the ‘nominated output units’ by which thesescores can be subdivided. The University of Waikato reported its entire Faculty of Arts
and Social Sciences as a single nominated output unit. In contrast, the University of
Auckland designated nominated output units with as few as 4 academic staff.
Professor Jonathan Boston (2004), the principal architect of the PBRF methodology, hasprovided a rationale for the decision to mandate individual assessment and reporting.
He argued that the beneﬁts of individual ratings included reduced compliance costs,
congruence with research practice, enhanced self-assessment, consistency withmultidisciplinary panels, more powerful incentives, more honesty and more transparency(Author’s notes from the plenary session, 21-5- 2004). Boston (2004) has subsequently
indicated that – with hindsight – the decision to include individual ratings did not provide
these beneﬁts. Indeed, it is difﬁcult to ﬁnd much support for individual ratings outside ofmanagement and HR. In this regard, the Phase I Evaluation of the implementation of
the PBRF and the conduct of the 2003 Quality Evaluation rather wanly recommends:“That the individual staff member be retained as the unit of assessment in the Quality
Evaluation” (Web Research, 2004: 13).

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8 Bruce Curtis and Steve Matthewman

Individual ratings may not provide the beneﬁts hoped for by Professor Boston, but they
do deliver a powerful resource to the senior managers of universities and to humanresource practitioners. Extensive interviewing shows that the potential for the PBRF
Quality Evaluation in 2003 to provide a comparative rating of individual staff proved
an irresistible opportunity for the senior management of universities and consequently
shaped the input of the NZVCC to the PBRF methodology. The results of such bundling of
a HR component with the assessment of research are not yet worked through, and will be
uneven across the sector, but seem likely to be to the detriment of academic professional
control. For example, AUT has moved someway to separate research and teaching.
Similarly, forms of gaming open to institutions in future Quality Evaluations (scheduled for2006 and 2012) are constrained by TEC mandates that all eligible staff participate and by
the individualistic character of that evaluation. Yet senior management can determine thepattern of nominated output units. It can be expected that institutional gaming will seek tomaximise PBRF results across institutions but will also attempt to align the assessmentof research with effort to ‘rationalise’ teaching, etc. (in effect, picking winners in the formof nominated output units).

‘The HR challenge’
The methodology for assessing the research performance of universities and individual
academics is complex and ramiﬁcations of the results will take time to work through (seeTertiary Education Commission, 2004b for an extensive discussion of the methodology
and results). Nevertheless, Professor Pat Walsh, leading industrial relations expert andnew Vice Chancellor at Victoria University of Wellington, notes the PBRF strengthens
and justiﬁes the activities of human resources practitioners in universities:“Now under the previous funding system universities could afford – theymight not have liked it – but they could afford to take a tolerant view of those
whose research performance was inadequate. Under the PBRF this will
become more difﬁcult. The fundamental – and I’m tempted to say unique– aspect of the PBRF is the one-to-one relationship it establishes between
the research performance of individual academic staff and the reputation
and revenue of the institution. Our principal funder has decided that ourrevenue will rise and fall directly with the assessed research performanceof each academic... The challenge for universities under the current PBRF
regime will be establish performance management systems which fairly
assess the contribution made by academic staff, including those whose
research performance is demonstrably unsatisfactory. ... This means that all
universities face the fundamental HR challenge of developing performance
management systems which properly recognise both the collective natureof research production and the variable nature of individual contribution to
the collective effort” (Walsh, 2004).

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The Managed University 9

The less ‘tolerant’ HR and its move into the realms of academic work, is likely to be
uneven across universities but has powerful drivers in the PBRF. There are at least
four critical ratios in the methodology of the PBRF, around which universities (and otherTEOs) will probably strategise and which constitute the performance element of ‘the HR
challenge’.
It must be acknowledged that 20:80 ratio between PBRF and EFTS means that while
the emphasis on maximising student numbers will reduce it will remain central. However,high ratings under the PBRF also bring reputational beneﬁts and possible multipliereffects for the top-ranked universities. It seems to be assumed by senior managementin universities that EFTS will also follow PBRF success. This assumption explains the(successful) effort on the part of the New Zealand Vice Chancellor’s Committee (NZVCC)
to ban publication of the part of the PBRF report (e.g., Tertiary Education Commission,
2004b) that made comparison between New Zealand and foreign universities. It mightalso be argued that the NZVCC considered that the performance of its members should
be exempt from the kind of comparisons made on academic staff in the 2003 Quality
Evaluation.
Certainly, the resources made available through the PBRF – at least formally disconnectedfrom EFTS – provide opportunities for senior management in universities to strategise
and pick winners. In this respect, it is signiﬁcant that while staff participation in the 2003
Quality Evaluation was mandated by TEC and line management in universities, noagreements were secured by staff at any university as to how any windfall from the
PBRF might be spent. Other key ratios in the PBRF methodology provide insights into
the strategies and gaming that senior management/HR are likely to prefer.
As noted, the ratio for the components of PBRF funding is 60:25:15 between Quality
Evaluation/ research degree completion/external research income. This means that thegreatest proportion of funding comes from the assessment of the quality of researchof individual academics. Arguably, the greatest gains can come from improving quality
scores of institutions and their nominated output units, although it should be notedthat research degree completions (i.e., of Doctorates and Masters) is likely to attract
resources.
In the realm of quality scores the key ratio is the rating of staff in terms of A/B/C/R quality
scores with the calculation of funding, which is 10:6:2:0. Thus, a B academic is worth threetimes as much as his C counterpart; an A academic is worth ﬁve of her C colleagues; and,an R academic is worth nothing at all. The HR drive is clear: to maximise A’s, to identify
and raise high B’s and C’s, to minimise R’s. How this is worked through on an institutional
basis is unclear. One Vice Chancellor has proposed and subsequently retracted thepayment of bonuses to A and B rated staff. The most immediate and likely result is in
the area of staff hiring, where senior management and HoDs are extremely reluctant tohire junior staff who may accrue R’s (the next census date is 21-12-2005). This is also

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10 Bruce Curtis and Steve Matthewman

the realm of unintended consequences insofar as disciplines and institutions that haveexperienced growth in recent years are likely to have more junior staff and subsequently
R’s and C’s than those that were stable or in decline. Possibly the good result of the
University of Canterbury vis a vis the University of Otago reﬂects this pattern.
But not all subject areas are treated equally by the PBRF, and this affects the worth ofindividual quality scores. All of the subject areas assessed by the Social Sciences &Other Cultural/Social Studies; Humanities and Law; and Education Panels were assigned
a weighting of 1 with the exception of Psychology (with a weighting of 2). Similarly, thesubject areas in the Creative and Performing Arts Panels were assigned a weighting of
2. (The laboratory-based sciences were weighted 2.5.) This has obvious consequencesat the margins for the constitution of academic departments and nominated output units(albeit only at the margins), insofar as a social psychologist assessed as a sociologist is
worth half the value of one assessed as a psychologist, etc. The overall effect on funding
for the Arts in comparison with other groupings (e.g., Science, Medicine) is likely to be
negative. Further bad news for Arts can be found in a recent speech by the Minister ofFinance:“The recent analysis for the Performance-Based Research Fund showedthat New Zealand academics are world-class in areas such as philosophy
and criminology; but we need to ensure that we are world class inbiotechnology and the other disciplines that, in the medium to long-term,
will pay the bills. It is time to shift the balance of our tertiary system towards
more of an explicit industry-led approach” (Cullen, 2004).
The Minister sends a clear message to the senior managers of universities. Thus,
Professor Walsh is undoubtedly correct in his estimation of a new challenge for HR.
The PBRF has provided both resourcing and a rationale for a greater involvement of
HR practitioners, new managerialism and performance measures in research (and inteaching).

Staff attitudes: Unity and division
As outlined above, a self-complete survey of academics in the humanities and social
sciences was undertaken to gauge attitudes to the PBRF and other developments inlate 2003. The questionnaire asked academics to rate 56 statements in terms of a Likert
scale: Strongly Agree =5, Agree =4, Neutral =3, Disagree =2, Strongly Disagree =1. The
timing of the survey coincided with the 2003 Quality Evaluation, during which individual
staff were required to complete Evidence Portfolios for the PBRF. The survey conﬁrmed
previous studies showing academics are overworked and stressed. Similarly, initial
results suggest that the conditions enjoyed by academics may have been in decline
for some time. This supports the contention that increases in student numbers in the
1980s and 1990s, coupled with funding cuts and an increase in the staff-student ratio

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The Managed University 11

has considerably undermined the practices of what was considered “traditional academic
work” (Chalmers, 1998, Scott and Scott, 2004). Chalmers has identiﬁed that academics
spend the bulk of their time teaching and bemoan increasing administration duties andreduced time for research. The survey reiterates these concerns.
Arguably, the clearest theme to emerge is that academic work should combine researchand teaching:

The respondents not only ranked as 1 the statement ‘Academic positions should
combine teaching and research’ (i.e., agreed with it most strongly), but also statements
about exclusive teaching and research ranked lowly, at 51 and 52, respectively. Similarly,
respondents provided rankings that show support for a traditional (possibly a nostalgic)
constitution of academic work:

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12 Bruce Curtis and Steve Matthewman

Recent ‘policy-speak’ from government and business interests that emphasised theknowledge economy, wealth generation and business models for universities wereranked lowly (i.e., disagreed with). At the same time, respondents were conﬁdent about
the quality of New Zealand higher education:

Their assessment is at odds with the methodology and results of the PBRF, wherein
the percentage of A-graded academics in New Zealand was about half that of the UK
RAE. This reﬂects both the deadening effects of the ‘peer esteem’ and ‘contribution to
the research environment’ components of Evidence Portfolios and an unreasonabledeﬁnition of the criteria for an ‘A’ (Dalziel, 2004).
Overall, academics were somewhat pessimistic about the tertiary sector:

But, were marginally optimistic about their own careers:

However, these assessments of pessimism and optimism were highly variable by subject
and university, as was the middling assessment of the PBRF:

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The Managed University 13

Indeed, the variance of ranking statements on pessimism, optimism and the PBRF whenother factors are introduced to the analysis (these results will be published in the near
future), suggests signiﬁcant divisions in academic ranks. Thus -in late 2003 at least- there
appeared both a binomial distribution of rankings in terms of pessimistic and optimistic
clustering, and a strong locational determinism. It is perhaps unsurprising that therelationship between these two elements linked pessimist and poor PBRF results, andoptimism and good PBRF results. This should worry proponents of traditional academic
work (or whatever can best be salvaged from two decades of systematic under-funding)because it suggests that new managerialist arguments about picking winners and otherstrategic punts are likely to ﬁnd support from some academics.

Conclusion
The initial results of the survey are surprisingly mixed, but suggest that academics
consider themselves overworked and stressed (cf Chalmers, 1998). The responses
also demonstrate a commitment to traditional forms of academic work. However, theextent to which academics are willing and able to resist managerialist erosion of theirprofessional control over research, teaching and other conditions of work seems more
problematic. The pursuit by senior management of universities for new performancemeasures and other elements of ‘the HR challenge’ is likely to be advantaged by very realdivisions within academic ranks. What remains unclear is the extent to which academics(particularly those advantaged by PBRF and similar arrangements) within the humanities
and social sciences pursue strategies that undercut existing forms of professional control
or collegiality.

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Mallard, T. (2005), Tertiary education funding switches to quality. Press release, 19 May 2005, www.beehive.govt.nz/
ViewDocument.aspx?DocumentID =23108, accessed 25 May 2005
Morgan, K J. (2004), The research assessment exercise in English universities, 2001, Higher Education, 48: 461-482.
Peters, M.C. (2001a) Performance-based research funding options for the tertiary education sector (Part B) Wellington:
New Zealand Vice Chancellors’ Committee.
Peters, M.C. (2001b), Performance-based Research Funding (PBRF): Mixed Model Implementation Details, Discussion
Paper (Part C), Wellington: New Zealand Vice Chancellors’ Committee.
Slaughter, S and L L. Leslie, (1997), Academic Capitalism: Politics, Policies and the Entrepreneurial University, Baltimore:
Johns Hopkins University Press.
Sporn, B. (2003), Adaptive University Structures An Analysis of Adaptation to Socio-economic Environments of US andEuropean Universities, London: Jessica Kingsley.
Scott, W.A. and H.M. Scott, (2004), University income and student numbers between 1980 and 2002: Summary tables
and charts, http://www.aus.ac.nz/funding/tables.pdf, accessed 25 May 2005.
Talib, A.A. (2003), The offspring of new public management in English universities: ‘Accountability’, ‘performancemeasurement’, ‘goal-setting’ and the prodigal child –the RAE, Public Management Review, 5(4): 573-583.
Tertiary Education Commission, (2004a), Overview and key ﬁndings: Performance-based research fund, evaluating
excellence: the 2003 assessment, Wellington: Tertiary Education Commission.
Tertiary Education Commission, (2004b), Performance-based research fund, evaluating excellence: the 2003 assessment,
Wellington: Tertiary Education Commission.
Tipples, R and B. Krivokapic-Skoko, (1997), New Zealand Academics and Performance Management, International
Journal of Employment Studies, 5(2): 103-116.
Walsh, P. (2004), Transcript of Plenary Sessions, PBRF Forum: Evaluation of the Assessment Framework, The Royal
Society of New Zealand Social Sciences Committee, http://www.rsnz.govt.nz/advisory/social_science/media/pbrf2004plenary.php, accessed 25 May 2005.
Web Research, (2004), Phase I Evaluation of the implementation of the PBRF and the conduct of the 2003 Quality
Evaluation, Wellington: Centre for Research on Work, Education and Business Ltd.

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The Managed University 15

Appendix 1: Ranking of statements
In late 2003, a mail-out self-complete survey was sent to all academic staff at the eight New
Zealand universities located in the humanities and social sciences. 1779 questionnaires
were sent out. 617 completed questionnaires were returned, along with 44 uncompleted
ones. The questionnaire asked academics to rate 56 statements in terms of a Likert scale(Strongly Agree =5, Agree =4, Neutral =3, Disagree =2, Strongly Disagree =1). Below thestatements are ranked in descending order of agreement.

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16 Bruce Curtis and Steve Matthewman

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The Managed University 17

Footnotes
1 While the goal of the PBRF is research focused, its origins in EFTS-based fundingof teaching created at least one major inconsistency: staff employed on ‘research
only’ contracts were not assessed in the 2003 Quality Evaluation while many (mainly
senior tutors) on ‘teaching only’ contracts were. A number of respondents have argued
that the inclusion of teaching in the assessment of research was necessary in orderto prevent the non-university TEOs from ‘gaming’. That is, the universities would beless adversely affected by the inclusion of teaching only staff than the polytechnics,
colleges of education, waananga, and private training establishments.
2 Professor Paul Dalziel (2004) has noted that the sections on contribution to research
environment and peer esteem were more likely to reduce the quality score of potential
A academics.

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Farm Employment Relationships 19

The Employment Relationship – a conceptualmodel developed from farming case studies
RUTH NETTLE*, MARK PAINE** & JOHN PETHERAM***

Abstract
This article reports on and develops the extant research in order to understand thechange processes in farm employment relationships. Aspects of farm employment
do not often feature in the business literature and only few studies that speciﬁcallyaddress “relationship” issues in very small (or micro) businesses can be found ineither the agricultural, small business or human resource management literature. The
article outlines research that involved case studies of dairy farms in Victoria, Australia.
Depth interviews were conducted over two years with dairy farm employers and theiremployees. A conceptual model of employment relationships was developed to better
understand change processes in farm employment. This conceptual model may havewider signiﬁcance for understanding small business employment in general and can also
be a tool for third parties in supporting employment relationships. Further, the developed
methodology has the potential to enhance employment relationship research.

Introduction
There has been little attention given to the issues surrounding the relationship between
employer and employee and the changes that inﬂuence the relationship within a rural
setting. This article reports on research into change processes in farm employment
relationships and argues for a “relationship” view of employment.
The article focuses on a study that investigated the employment relationships within
the Australian dairy industry. The farm gate value of Australian dairy produce is aroundthree billion dollars (Dairy Australia, 2004a) and dairy is one of Australia’s leading ruralindustries in terms of adding value through further processing, ranking third in world dairy
trade (Dairy Australia, 2004a). Dairy contributes 0.2% of Australia’s GDP with agriculture
overall contributing 3.1% (ABARE, 2000).

* Dr Ruth Nettle is a Research Fellow in Innovation and Change Management, Faculty of Land and Food Resources,
University of Melbourne, Parkville, Australia.
** Dr Mark Paine is a Principal Research Fellow in Innovation and Change Management, Faculty of Land and Food
Resources, University of Melbourne, Parkville, Australia.
*** Dr John Petheram is a Senior Lecturer (School of Resource Management), Faculty of Land and Food Resources,
University of Melbourne, Creswick, Australia.
The authors would like to acknowledge the funding provided for this research by Dairy Australia (formerly known as the
Dairy Research and Development Corporation) through their research scholarship program.

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20 Ruth Nettle, Mark Paine and John Petheram

The majority of Australia’s 9,600 dairy farms are family owned and operated and theaverage herd size has increased from 77 cows in 1975, to 197 in 2003 with many farms
having herds greater than 250 cows (Dairy Australia, 2004ab). Huge productivity gains
have been achieved at the farm level in this time through improved technology andsubstitution of labour with capital. This, and increasing herd size, has increased thedemands on management and, often, the dependence on non-family labour. Althoughreliance on family labour is high with 61% of farms using only family labour (Dairy
Australia, 2005), this is changing (down from 66% in 2004). In a recent survey in SouthWest Victoria, farms were categorised based on the way in which labour was sourced andused (ACCIRT, 2004b). The study described: Traditional family farms (involving family
labour only); Transitional farms (employing part-time and/or casual workers especiallyfor relief milking); and Modiﬁed family farms (involving full time wage labour – with often
less than 5 full time workers). Although modiﬁed family farms were more likely to belarger businesses (based on dairy herd sizes over 200 cows) and traditional family farms
were more likely to be smaller businesses (based on herd sizes less than 200 cows),
each category included a range of herd sizes. Overall, in this survey, paid labour wascontributing between 40% and 70% of total farm labour. Further, employers surveyed
identiﬁed a range of employment issues impacting on their farm businesses including
attracting, retaining, paying, developing and organising their employees and managing
the employment aspects of their business.
On-farm employment issues can be viewed as part of the wider social pressures mounting
on human resources in rural areas. This pressure arises from a combination of factors:
declining numbers of farms/farmers; movement of resources out of farming; declining
numbers of young people in rural areas; declining rural services/population; and reticenceof family members to return to farming (ABARE, 1998). These pressures are often
expressed as low labour supply, lumpy labour demand (corresponding to ﬂuctuations infarm-gate milk prices), reduced availability of family resources, production seasonality,
and low commitment to training or development due to job instability (ABARE, 1998;
Gasson and Errington, 1993).
In the dairy industry in Australia, there are concerns regarding the attractiveness of dairy
farming to potential employees (Bodi and Maggs, 2001; ACIRRT, 2004a), and recent
estimates of dairy industry turnover in the farm-hand sector of between 20-50% (ACIRRT,
2004b) suggest there are also employee retention issues. Despite these issues andconcerns dairy industry attention often focuses on industrial processes (pay rates andconditions), recruitment strategies such as trainees and apprenticeships (Rural Skills
Australia, 2004), addressing skills gaps (Bodi, et al., 1999) and employer training (Murray
Dairy, 1998). However, there has been little emphasis on understanding the dynamics of
employment relationships from both employer and employee perspectives.
The article commences with a review of literature and research relevant to farm
employment relationships and provides the context for the research study. The remaining

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Farm Employment Relationships 21

discussion focuses on the empirical research of employment relationships, namely the
research methodology, the results and their implications. In particular, the research isused to develop a conceptual framework which aims to enhance the understanding of
employment relationships and thereby facilitate improvements in these relationships.

Key Literature Contributions to the Study of Farm Employment
Relationships
Traditionally, farm management and agricultural economics have been the main
disciplines for examining labour and employment issues in agriculture. More recently,
the discipline of human resource management (particularly in relation to small business)has an emerging proﬁle in farm employment. This section of the article reviews thecontributions from these disciplines and highlights current gaps in theory and methodology
for understanding change processes in employment relationships.
Farm Management and Agricultural Economics
Research, theory and teaching in the realm of farm management have traditionallyconcentrated on applications of micro-economic theory and marketing at the level of the
farm (Malcolm, et al., 1996: 173). Conceptually, the farm is seen as a “ﬁrm” and neoclassical economic theory assumes that labour, as one of the three factors of production, ishomogenous, perfectly informed, perfectly mobile and can immediately adjust in quantity
to a new equilibrium, given a change in relative prices. However, as Gasson and Errington(1993: 120-135) recognise, once labour is employed in an owner-operator business,wages have to be paid out of proﬁts, thus changing the social relations of production. In
addition, for farm employers the effect of extra labour is uncertain, prices for agricultural
products are uncertain, labour skill and ability differs and there are transaction costs,
opportunity costs and psychic costs in ﬁnding, hiring and training labour (Gasson and
Errington, 1993: 120-135; Errington and Gasson, 1994). These aspects are compoundedby the very real stress involved in employment management. Unfortunately, the analysis
by Gasson and Errington provides little insight into how the farm employment difﬁculties
may be traversed.
Canadian agricultural economists Howard and McEwan (1989) reviewed the disciplineof Human Resource Management (HRM) and its relevance to agriculture. Although
they suggest HRM theory has more to offer than economic theory, their model of HRM
emphasises individuals as being motivated by utility functions (proﬁt and leisure) and
restrict HRM processes to the managerial functions of attracting, keeping and motivating
employees (Howard, et al., 1991). The focus in HRM research in agriculture has beenon employee satisfaction, farm labour force size and the relationship with turnover,
employee wage rates and employee rewards and beneﬁts (Howard, et al., 1991). The
dominant theme of their proposed research agenda for farm HRM is on the impact of
HRM policies at the farm level, to help farmers develop “optimal” HRM policies. This is

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22 Ruth Nettle, Mark Paine and John Petheram

a limited research agenda, with neither a focus on the employment relationship, nor on
processes of change toward these “optimal” HRM policies.
HRM and Small Business
The discipline of Human Resource Management (HRM) has addressed the strategic
and tactical actions undertaken by organisations to manage their employees (Steffy andGrimes, 1992: 181). Much of the HRM research and literature is often criticized for viewing
procedures of HRM as an end in themselves, rather than part of the social and cultural
construction of employment (Storey, 1995: 25; Benmore and Palmer, 1996). For instance,
although there is anecdotal evidence of increasing use of standard HRM practices andprocedures at the farm level, (mainly driven by regulatory and statutory requirements– see Rural Skills Australia, 2004), it has yet to be researched as to how such practices
are used and what outcomes are experienced by employment participants.
In regard to small business HRM issues, although there is increasing interest in therelevance of management and organizational theory to small business (Scase andGoffee, 1987; Scase, 1995) speciﬁc gaps and/or criticisms still exist. These include:
•
•
•

•
•

The extent to which employee perspectives are considered in HRM processes
and decisions (Bacon, 1999: 1183; Guest, 1999);
The alignment of perceptions and expectations of employers and employees(Burchell and Rubery, 1993);
The narrow or stereotyped views of employee relations in small ﬁrms such as“labour harmony” or “bleakhouse” (Wagar, 1998; Wilkinson, 1999; Goss 1991;
Rainnie, 1989; Gilbert and Jones, 2000);
The impact of business size on HRM (Marlow, 2000 and 2002); andA need for research to reﬂect human agency rather than deterministic managerial
control strategies (Wagar, 1998 and Wilkinson, 1999).

Ram and Edwards (2003: 726) suggest that extant research is aimed at understanding
more about processes by which actors in small ﬁrms handle the employment relationship,
however most of the cited studies involve medium sized enterprises employing over
100 people and do not address individual employment relationships in very small ﬁrms.
Although Ram and Edwards (2003) support further research into the dynamics of change
in employment relations, this raises the issue of the sort of research methodologies used.
For instance, Bacon (1999) and Guest (1998, 1999) criticise the reliance researchers
place on survey instruments that involve questions of primary interest to managers andoften do not represent employee experiences of work.

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Farm Employment Relationships 23

Psychological Contracts
A developing area of Human Resource Management theory is that of “contracting” inemployment relationships. Rousseau, (1990, 1995) and Herriot (Herriot, 1992; Herriot,
et al., 1997) explore the nature of “contracting” in employment, differentiating between
transactional and relational forms of employment contracting. Rousseau (1995: 3)
strongly criticises the competitive, transactional view of employment and contracts. She
suggests that this market orientation commodiﬁes labour and employment and adopts ashort term and limited view of what employer and employee offer each other, downplaying
the value of the relationship. (Burack, et al., 1994: 151) concur, suggesting that future
employer-employee relationships will be based on new psychological contracts whichemphasise:“….the social or psychosocial aspects of work and trust based on the mutual
responsibilities and good faith efforts of both…reach(ing) far beyond the legalitiesof traditional employment contracts”.
Millward and Hopkins (1998) advance the application of the theoretical psychologicalcontract framework to small businesses. They suggest that the concept of psychologicalcontracts is vital to an analysis of changes in the nature of the employment relationshipand that the psychological contract is primarily a job-level rather than an organisational
level phenomenon (emphasis added). Focussing on the content of the psychologicalcontract, Herriot, et al. (1997: 160) found that it is the relative salience of the componentsof the psychological contract for the two parties that are at issue, that is, fair exchange.
Tipples (1987, 1995 and 1999) has reviewed the changing nature of farm employment
relations in New Zealand. Furthermore, he and colleagues (Tipples et al., 2000)
applied the theoretical framework of psychological contracts to understanding farm
sector employment in New Zealand. Tipples (1996) had theorised a four stage process(pre-creation, creation, maintenance, conclusion) to be considered from the employer
and employee perspective in a contracting approach. Tipples and colleagues foundthat employers and employees have different views on the most salient features ofpsychological contracts, which would need to be addressed in establishing “matches”.
This “relational contracting” perspective, although offering a unique focus on both
employer and employee in farm employment does not offer an understanding of how
the psychological contract is “worked out” in speciﬁc relational contexts and downplays the importance of processes (eg. how is “mutuality of meaning” accomplished?).
These limitations highlight both a theoretical and methodological issue in employment
relationship research which will be explored further below.
The preceding brief review highlights the need for both theoretical elaboration andmethodological development to make progress in the area of farm employment
relationships. To address this development need, research within relationships is

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24 Ruth Nettle, Mark Paine and John Petheram

required, with attention on relationship processes between employer and employee. A
study designed on the basis of these theoretical and methodological gaps is outlined in
the next section.

Research Methodology
The need to deﬁne and understand employment relationship processes requires amethodology that permits the study of actual employment relationships in real time andallows for the differences in how employment participants construct meanings. Further,a sensitive and conﬁdential approach is required, acknowledging the complexity ofrelationships. These criteria present methodological challenges, which include:•••

Gaining access to employment relationships;
Discovering ways to capture and interpret employment events; andMaintaining conﬁdentiality for participants.

To address these challenges, a solid, social theoretical framework is required to guidethe research process. A constructionist methodology was considered a necessary
and appropriate basis from which to explore processes in employment relationships.
Constructionism is a social theoretical position that suggests reality is created in the
discourse of, and negotiations among, people as social actors (Crotty, 1998; Charmaz,
2000). It is the socially negotiated agreements that become experienced as "objective"
truth. The aim in constructionist research is to search for the system of meaning that
actors use to make sense of their world. Such a methodological approach is usefulhere because farm employment occurs in a social setting (people on farms and in ruralcommunities), farming has complex social and cultural motivations (households as wellas livelihoods and businesses) and farming is multi-dimensional (involving economic
imperatives, management capability, biological and ecological elements, and humanaspirations and interactions). Employment events will be interpreted differently andmeanings constructed differently. It is the analysis of the generation of meanings that is
important in understanding relationships. Therefore, the chosen approach is preferred as
it allows concepts and theory to emerge from data, rather than a preconceived theoreticalframework guiding the choice of data to be analysed. Furthermore, the qualitative research
approach aims to “capture” the constructed perspectives of employer and employee andthereby gain an in-depth understanding of employment relationships and processes.
Proﬁle of the Case studies
The study was conducted in Gippsland, Victoria, Australia, east of the state capital city,
Melbourne. This region contains over 2300 dairy farms employing an estimated 350
employees (not including sharefarmers) (ACIRRT, 2004a).
Interviews were conducted with dairy farm employers, sharefarmers and employees in

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Farm Employment Relationships 25

the region to gain an appreciation of general issues being faced in relation to employment.
In choosing interviewees, industry informants were asked for a list of names of dairy
farmers who employed people outside the family (ie. transitional and modiﬁed family
farms as identiﬁed earlier) and used different models of employment (sharefarming,managers, full-time/part-time, apprentices/trainees). In general, such transitional andmodiﬁed family farms are larger farming businesses involving herd sizes over 200
cows, representing the limit to two-person owner-operator family farms. Small farming
businesses are those generally with herd sizes less than 200 cows and using all family
labour (traditional family farms). The focus in this research is on the transitional andmodiﬁed family farms because these farms involve employment relationships beyond
that of family members alone.
From these preliminary interviews, ﬁve farm businesses were selected as case studies
for further research. All of the selected case farm owners and employees were willing to
be involved in the case study research after receiving a copy of the research statement
and ethics procedures. Details relating to conﬁdentiality, use of the data, reviewing theirinterview transcripts and being involved in a feedback process, were discussed withparticipants.
The ﬁve farm businesses and their employment relationships were “followed” over 2 years
as longitudinal case studies and provided insights into the context of actual employment
relationships. The purpose of the case studies in this research follows Mitchell (1983:192)
who argues that a case study is: “…a detailed examination of an event (or series of related
events) which the analyst believes exhibits the operation of some identiﬁed theoreticalprinciple”. The cases were selected based on both the diversity of employment context,
structure and functioning, and the potential that the case offered towards learning about
employment relationships (Stake, 2000: 446).
Semi-structured interviews were conducted with each employer and employee every
six months over two years. The interviews consisted of questions relating to theemployers’ and employees’ history and context of employment, employment eventsand interpretations of those events, actions taken in employment and interpretation ofoutcomes from these actions. As far as possible, where an employee left the employment
relationship they were followed up in their new position. Each interview was audio-taped
and later transcribed to a word processing ﬁle. Each case study consisted of between one
and three employer-employee relationships over time. A description of the case study
farm features and key themes over time, identiﬁed in the employment relationships, isprovided in Table 1.

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26 Ruth Nettle, Mark Paine and John Petheram

Table 1: Proﬁle of the Case Studies: herd size, employment structure and critical
employment events during the study.
Case Farm 1:
Theme: “More than a job”: expectations and rules that guide activity in farm employment.
Case description: 300 cow farm, farm owner couple near retirement age, sharefarming model,
high turnover of sharefarmers (3 over the course of the research), no sharefarmer capital
contributed.
Critical employment events over time: stability to instability → planning for stability → building
a relationship (1) → falling out → building a relationship (2) → going separate ways → hanging
in the balance.
Case Farm 2:
Theme: “Changing rules”.
Case description: 600 cow “rapid expansion” farm, farm owner-manager with 2 permanent and
3 to 5 casual employees.
Critical employment events: Breaking from tradition → Expansion and change → Learning→ Getting it right → More change.
Case Farm 3:
Theme: “Change as the intervention”.
Case description: 1100 cows over 3 farms, major change from sharefarming to management
model during the research and reduction in number of people working.
Critical employment events: Stability → Stagnation → Change →Working it out.
Case Farm 4:
Theme: “Change in the family farm”.
Case description: 600 cow farm, brothers as farm owners and managers with permanent andcasual employees.
Critical employment events: Family order → Employing workers → Learning → Keeping
options open.
Case Farm 5:
Theme: “Change in the investment farm”.
Case description: 300 cow farm owned by an investor, change from 50% sharefarming modelto 2 specialised employee roles.
Critical employment events: Working it out → Mutual separation → Learning → Exciting
possibilities.

Data Analysis
The constant comparative method of grounded theory (Glaser and Strauss, 1967)
provided a way to organise the rapidly accumulating store of text data as each casestudy unfolded. In this analytical approach to data analysis (based on the constructionist
framework of symbolic interactionism (Blumer, 1969), theory is systematically generated
from data (Glaser, 1978). The grounded theory method consists of systematic inductive
guidelines for collecting and analysing data to build middle-range theoretical frameworks
that explain the collected data (Charmaz, 2000: 509). The fact ﬁnding, comparing,
contrasting, classifying and cataloguing (analysing) activities are conducted progressively
and iteratively (Miles and Huberman, 1984).
By way of an example of concept development arising from the research, the key concept“guiding rules of employment” (see Table 2 and discussed further in the results section)

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Farm Employment Relationships 27

emerged from analysis of employer and employee experiences in employment over time.
Different employer “guiding rules” were evident and explored in the context of their impact
on employment outcomes, as illustrated from the response by the employers from casestudy 3 and case study 1:“…some people have been with you long enough that they actually take initiative
and will do things and then after a while (you) see that they think you leave
too much to them, but I always think you should be getting satisfaction out of
having responsibility. Well I do…” [A guiding rule that employees need to havemotivations similar to employers.]“…nearly every dairy farmer in the country has to do it (work Christmas day) if
that’s what you want to do…that’s dairy farming…whether they (sharefarmers)
really want to be dairy farmers, you start to wonder because dairy farming is a
big commitment…” [A guiding rule that people wanting to be in dairying have toshow the same form of commitment as the employers.]
Computer software can enhance the ability to rapidly store, recall, (re) code andelectronically make memos of recorded data. The software used (NUD.IST n-vivo™
version 1.1, 1999 (Non-numerical Unstructured Data Indexing Searching and Theorizing))
permitted the coding of interview transcripts and ﬁeld notes. The transcriptions of
employment participant interviews were entered as separate on-line documents andﬁled as a case study. The coding process involved each document being analysed,with segments of transcript allocated to a node address. Memos (representing the
researchers’ analysis of the codes) were built for each node. These memos were used
to examine relationships between concepts and formed the basis of the development ofa model of the farm employment relationship for each case study.
After the case studies had been documented, analysed and a conceptual model of theemployment relationship built, research participants (employers and employees) were
provided with this material and a conversation was held between the researcher andparticipants regarding the “ﬁt” of the models to their experience - a requirement of thegrounded theory methodology (Glaser, 1978). Their responses were audio-taped anddocumented and used to further reﬁne the models.

Results and Discussion
The key concepts in employment relationships identiﬁed from the analysis of each casestudy are outlined ﬁrst, along with the understanding of employment relationships thatemerged from the analysis. Then, a model of the employment relationship is presented,
representing how the key concepts in employment relationships are linked. Finally, thecontribution of these ﬁndings and the methodology to employment relationship research
is discussed.

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28 Ruth Nettle, Mark Paine and John Petheram

Key concepts and processes identiﬁed in employment relationships
As each interview transcript of employment was analysed, concepts explaining theconcrete events of the case study farm employment relationships were developed.
This iterative process identiﬁed 20 “key concepts” in employment relationships.
Further analysis grouped concepts that were functioning in closely related ways in theemployment relationship into categories. The four concept categories developed were:
1. core principles guiding employment; 2. mediating processes; 3. change processes,
and 4. relationship outcomes. These concepts and categories are deﬁned in Table 2.
Table 2: Explanation of key concepts identiﬁed in farm employment relationships
1. Core principles guiding employment• Guiding rules: The beliefs and attitudes that employers and employees hold regarding employment relationships
and what can be expected from them. “Guiding rules” generate the assumptions, expectations, and often theoutcomes of the relationship.
• Relationship role positioning: The process of deﬁning ones position and role in the employment relationship that
directly inﬂuences the expectations of the “other” person and the job.
• Employee career orientation: The way employees “frame” their work in dairying. Key orientations include: ownershipof farm vs. job, partner vs. experience gainer vs. worker.
• Social shaping: The way employees and sharefarmers assess where there is “best-ﬁt” between their job and theirsense of self or life. It is a seeking, searching, assessing process.
• Employee socialisation: The way an employees past experiences in being employed or part of farm life inﬂuences
their orientation to employment. It can be deﬁned as the degree of good or poor socialisation and appears
inﬂuenced by tradition, age, experiences.
• Employee positioning: The “position” that (generally) youth take in dairying and their job. People often position
themselves either for or against farm ownership. Positioning is a way young people establish their identity, e.g., asfarmers/workers.
• Social order: The unique arrangement that can hold a family farm together, and provides the enduring value system
for members. High social order can give stability, resilience and endurance in times of change and instability.
2. Mediating processes in the relationship• Social order: The unique arrangement that can hold a family farm together, and provides the enduring value system
for members. High social order can give stability, resilience and endurance in times of change and instability.
• Active alignment: The process in which the actions of employer and employee align expectations of both therelationship and the work.
• Contracting: The process by which an employer and employee’s expectations are formalised in words andactions.
• Enlisting: The (positive) process of ‘mutual choosing’ in beginning an employment relationship, rather than“recruiting”.
• Embodiment: The (negative) process by which an employee or employer develops the idea of the ideal identity ofthe other.
• Communicative competence: Concerns the ability of those involved in the employment relationship to talk about
and take action toward maintaining the employment relationship (not just the job or contract).
• Support networks: The mediating, inﬂuencing and supporting roles that people outside the employment relationshipplay in the relationship.
• Bridging age-gaps: The extent to which the employment relationship strives to “bridge” the generation gap andinvolve all ages in employment processes.
3. Change processes• Becoming: The process of change and development that employers undergo. New roles, faculties and skills help
to create an emerging identity as an employer.
• Indicators for change: Is change evident – in thinking, in resilience, in active alignment, in “becoming”?
4. Relationship outcomes• Simple-reliable: The outcome when the employment relationship is not seen as important to employers or
employees. In other words, it is a transactional relationship – work for pay, labour as a factor of production.
• Relationship balance: An outcome of an employment relationship that involves a balancing of expectations, desires
and needs of both employer and employee• Relationship resilience: An outcome resulting from employer and employee actively responding to different shocks
as they emerge.
• Relationship synergy: An outcome resulting from the combination of other positive outcomes being attained (eg.
balance, resilience) and involves joint decision making, involvement and commitment in how the farm is run andimproved.

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The concepts represent a deep understanding of employment relationship attributes aswell as processes involved in employment relationship development and change. The
insight this analysis provides is discussed next. The deﬁnitions in Table 2 will need to bereferred to.
Understanding Employment Relationships
The identiﬁcation of key concepts and processes provides 3 main insights into farm
employment relationships. Firstly:-

Employment relationships have outcomes other than “retention” or “turnover”

The category “relationship outcomes” represents the group of concepts that focusedon what employment was achieving for both employer and employee. Employmentoutcomes are often described in a human resource management context as a dichotomy(i.e. either retention or turnover) and from an employer perspective. The case study
analysis identiﬁed extra dimensions of employment outcomes for both employer andemployee. These included:
•
•

•

•

transactional outcomes: the concept of “simple-reliable" or work for pay;balanced outcomes: the concept of achieving mutual beneﬁts from employment
through “balancing” expectations, desires and needs of both employer andemployee;resilient outcomes: the concept of actively responding to shocks to the relationship(eg. a large change in farm business operation, the impact of falling milk price) to
support both employer and employee needs; andsynergistic outcomes: the concept of joint decision making, involvement andcommitment in how the farm is run and improved that results in greater than
anticipated beneﬁts for both employer and employee.

Whereas employment outcomes are often viewed as an end in themselves, this analysis
suggests relationship outcomes are summative and hierarchical. That is, to achieve
higher level outcomes such as synergy, there is a stage-wise ﬂow from a balanced
outcome, through resilience to synergy. Relationship outcomes can also operate inreverse. For instance, a lack of change in relationships (stagnation) can mean a negative
summation, back down the relationship outcomes from (say) synergy to imbalance, tosimple-reliable, to turnover. This does not imply a value judgement about the “best”
outcome in employment relationships rather, it can support thinking by employers andemployees concerning desired outcomes.
Secondly:-

Key mediating processes are more than just HRM practices

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30 Ruth Nettle, Mark Paine and John Petheram

The employment relationship outcomes discussed above, result in part from mediatingprocesses, such as contracting, enlisting, alignment, communicative competence, bridging
age-gaps and mediating roles (see Table 2 for deﬁnitions). For high level outcomes,
the processes appeared summative. For an outcome of synergy, for example, all the
mediating processes are required to achieve this mature type of relationship outcome.
Such processes require a more active “working through” rather than an adherence to
HRM “procedures”.
Finally:- The core principles of employment held by employers and employees explain
relationship outcomes and the presence of key mediating processes
The core principles of employment held by employers and employees impact on
relationship outcomes directly, or through application of mediating processes for positive
and negative outcomes. For instance, an employer with a guiding rule of employmentthat suggests the need for long hours of work and limitations to income because “this isdairy farming” is less willing to look for ways to achieve balance or resilience and alsoless likely to engage in processes of alignment and contracting with employees. The“guiding rules” of employment are among the hardest to change, but they also have thegreatest scope for impacting positively on relationship outcomes.
These insights provided the basis for the development of a model of the employment
relationship which is discussed next.
A Model of the Employment Relationship
The inter-relationship between the four categories explaining employment relationshipconcepts and processes outlined in Table 2 forms a conceptual model of the employment
relationship. The 4 categories impact each other as employment relationships workover time. This is represented diagrammatically in Figure 1. The core principles thatguide employment relationships, effect relationship outcomes directly (1 impacts 4),
or they operate through employment participants engaging in mediating processes (1effects 4 through 2 and 3). In this way, the outcome of employment that is desired (4)appears to dictate the processes needed, which provides an indication for what core
principles (1) are necessary. This regressive “view” appears to be how improvement in
the employment relationship is achieved. The progressive “view”, that is, core principles(1) affecting processes (2) which determine outcomes (4), provides a way of explaining
how the current outcomes are being achieved on a particular farm. So in terms of therole of the model for improving employment relationships it can be viewed from either
direction.

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Farm Employment Relationships 31

Figure 1: A conceptual model of employment relationships (Processes of
explanation and improvement take place in opposite directions in the ﬂow chart.)

When presented with the speciﬁc models of their employment relationship, case study
participants found the analysis insightful and useful not only in explaining what had
happened, but in exploring alternative actions in the future. Responding to elements ofthe model of their employment relationship, an employee from case study 3 noted:“I would have “Guiding rules” smack bang in the middle in a big square – that’s
how important I think it is –the hard thing is that all your experiences – youhave to change the experiences to positive experiences so they can havemore positive guiding rules so they can work through all these things to get tobalance…a long road.”
Research Contribution
The conceptual model of employment relationships and its empirical research contributes
to the literature and the theory in a number of ways. In particular, the study has
questioned the preoccupation with staff turnover issues and HRM “procedures”; adds
to the knowledge of psychological contracts in employment and offers an alternative
platform for farm business management research.
Human resource practitioners may identify with the mediating processes of “Contracting”,“Active alignment” and “Communicative competence” and suggest that the research
merely conﬁrms the need for “good” human resource management. However we would
argue that this research has shown that “mediating practices” are embedded in the

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32 Ruth Nettle, Mark Paine and John Petheram

context of employers’ “Guiding rules” and employees are often ill equipped to participate
in the processes, thus “good” human resource management practice is not (by itself)
adequate for successful employment relationships.
The results also support an altered focus away from “turnover” issues in employment
toward the mutual action needed in achieving particular needs of employment participantsfor outcomes of “balance” or “resilience”.
Enhanced understanding of the theory and practice of “psychological contracts” inemployment relationships are offered. Although key elements of what might be referred toas a “relational contracting” perspective are visible in the model, a greater understandingof change and improvement for employees and employers is offered. For instance, thecontent of the psychological contract is focussed on the concept of “mutual obligations”(Herriot, et al., 1997) and perception of balance or imbalance in these obligations caused
problems in the psychological contract. This research suggests that perceptions of balance
can originate from an employer’s or employee’s “core principles guiding employment”– set prior to entry into an employment relationship. That is, their beliefs, attitudes andvalues held about employment that guide their (often unconscious) action, their “Rolepositioning”, or an employee’s “Career orientation” and degree of “Shaping”. These allinﬂuence pre-perceptions of obligations and balance in employment. This provides aframework for understanding more of Tipples’ ﬁrst stage in employment relationships of“pre-creation” (Tipples, 1996). The research has shown that if employers and employees
are aware of these core principles for themselves, and are able to explore them with theirrespective employees’ or employers’ principles, this provides a starting platform for initial“perception balance”.
Further, we would argue that this research contributes to the discipline of farm business
management by offering a change in focus away from the farm as a “ﬁrm” to the farm as a“social organisation”. This philosophical shift brings social theory and its methodologicalunderpinnings to farm management and allows a deeper analysis than often provided by
the usual focus - that of economic decision-making.
Methodology Contribution
The research approach in this study addresses some of the weaknesses of othermethodologies identiﬁed earlier. In particular, this studies’ methodology offers greater
insight into how employers and employees construct and make meaning of theiremployment experiences, allows for change processes in employment to be observed
and reported and strengthens the validity of research ﬁndings by involving research
participants.
The longitudinal case study and grounded theory methodology offers greater understandingof the agency of employer and employee within the employment relationship and their

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Farm Employment Relationships 33

respective roles in relationship processes than more traditional approaches that obtain“once-off” snapshots of employment relationships and have a limited ability to explorechange processes. Further, involving research participants in interpreting and providing
feedback on research ﬁndings not only offers a means of veriﬁcation of ﬁndings, but further
adds to the research results by providing another way for employers and employees
to reveal their construction of employment and how they view their agency within
employment. We would therefore argue that such rigorous qualitative methodologies
can offer employment researchers an alternative strategy in research approaches.

Conclusion
This article has reported on research to understand the change processes in farm
employment relationships. This understanding was encapsulated in a conceptual modelthat links four main process categories: “Core principles guiding employment”, “Mediatingprocesses” in employment relationships, “Change Processes”, and “Relationshipoutcomes”. Further, the research approach of longitudinal case studies and groundedtheory analysis was argued to be a potential alternative approach for employment
researchers aiming to understand more of employment relationship processes.
Although this research was conducted in the context of employment relationships in farmbusinesses, it is conceivable that the deﬁnition of the conceptual model of employment
relationships and the use of the model by researchers, employment participants andthird parties in employment is generally applicable to other forms of small businesses
involving small numbers of employees (i.e. less than 10 employees, often referred to as
micro-businesses).
Further research focusing on “relationship” aspects of employment is warranted,
particularly to explore the use of the employment relationship model by employment
actors and third parties as well as the efﬁcacy of the model to different employment
contexts (ie. small businesses).

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What Skills do Somali Refugees Bring? 37

What Skills do Somali Refugees Bring with
them?
BERNARD GUERIN, PAULINE GUERIN, RODA OMAR DIIRYE & ABDIRIZAK ABDI*

Abstract
To gain a better understanding of why refugees have difﬁculties getting employment, 90
Somali (35 men, 55 women) were interviewed about their employment histories prior
to resettlement in New Zealand and their experiences of employment in New Zealand.
Close investigation of employment histories showed that most had numerous skills andthat a large number had previously run their own businesses (mostly import/export).
However, the study found several properties of their prior skills did not transfer well totheir current setting due to language, cultural, and environmental issues. In particular,
previous business owners relied heavily on informal language use to inﬂuence customers
and sellers; many relied on informal social networking over different countries; many
depended heavily on informal negotiation; they had trade routes over land rather
than sea; they traded goods speciﬁc to the region; they ran informal economies on
the side; and businesses had few government rules and legal requirements to meet.
Recommendations are proposed to help overcome these more subtle difﬁculties andform the basis for future research interventions.

Introduction
Refugees moving into western countries are well known to have problems getting
employment, and are typically unemployed or underemployed (Altinkaya & Omundsen,
1999; Forrest & Johnston, 2000; Montgomery, 1996; Stevens, 1993; Strand, 1984;
Vinokurov, Birman & Trickett, 2000; Waxman, 2001; Wooden, 1991). Apart from the
difﬁculties this causes for successful resettlement there can also be serious long-term
physical and mental health problems arising from chronic under- or unemployment(Beiser & Hou, 2001; Holden, 1999; Pernice, Trlin, Henderson & North, 2000; Schwarzer,
Jerusalem & Hahn, 1994; Strandh, 2000).
Many of the barriers to employment for refugees are also well recognised, and include* Bernard Guerin, Professor of Psychology, Waikato University.
* Pauline Guerin, Senior Research Fellow in Psychology, Waikato University.
* Roda Omar Diirye, now Fatuma Hussein Elmi, Researcher, Waikato University.
* Abdirizak Abdi, Refugee Coordinator, Ministry of Education.
This work was supported by grants from the Foundation for Research, Science and Technology (UOWX0203, `Strangers
in Town: Enhancing Family and Community in a More Diverse New Zealand Society’) and the University of Waikato.
Bernard Guerin will be at the University of South Australia and Pauline Guerin will be at the University of Adelaide in thenear future.

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38 Ruth Nettle, Mark Paine and John Petheram

language difﬁculties, qualiﬁcations not being recognized, and discrimination (Altinkaya &Omundsen, 1999; Beiser & Hou, 2001; Daly, Barker & McCarthy, 2002; Faelli & Carless,
1999; Montgomery, 1991; North, Trlin & Singh, 1999; Shih, 2002; Smith, 1996; Valtonen,
1999; Wooden, 1991). For example, although refugees resettled in New Zealand havetheir skills and qualiﬁcations assessed on entry to New Zealand, these assessments utilize
western standards that often fail to acknowledge general skills, informal qualiﬁcations
and previous experience. Overall, there is little research or literature on the previous
skills that refugees have and how they might be better adapted to employment in the
new country.
The present research study aimed to ﬁnd out more about previous jobs and skills of
one group of refugees in one small city in New Zealand. While narrowly focused, it was
hoped that the methods and ﬁndings could be applied to other refugee groups. As part ofa longer term collaborative research programme with a Somali community, we examined
employment histories in detail, hoping to use the ﬁndings to develop new interventions
to overcome barriers to employment for these and other immigrant and refugee groups.
The community is very concerned about the problem, although a lot of effort goes into
working towards employment opportunities and education for their children.
As well as confounding of factors in predicting employment, another problem withthe refugee employment research area is that most of it has concentrated on men’s
employment and much less is known about women’s employment (Ahmed, 1999;
Chapple, 2001; Kelly, 1989; Markovic & Manderson, 2000; Morokvasic, 1993). We
therefore over-sampled women in the present study to gain further knowledge about
women’s employment histories and experiences.

MethodParticipants
The participants were 55 women and 35 men from the Somali community in New Zealand.
They were a convenience sample but we aimed for a range of ages and conditions. The
2001 Census (Statistics New Zealand, 2002) indicated that there were 576 males and 534
females between the ages of 15 and 69 living in New Zealand who identiﬁed as Somali.
The sample of 90 was an average of 32.3 years old, and had been in New Zealand foran average of 4.5 years. Of the 53 in the sample with children, they had an average of
5.3 children, ranging from one child to 15 children. The women were on average slightly
older (33.0 years, ranging from 16 to 69 years) than the men (31.1 years, ranging from18 to 50 years) and had been in New Zealand very slightly less time (4.4 years) than themen (4.6 years). Of those with children, the women, on average, had more (5.5) children
than the men (4.8). These characteristics are very similar to a previous sample, but had
been in New Zealand about one year longer because the present sample was contacted
about a year later (Guerin, Abdi & Guerin, 2003).

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What Skills do Somali Refugees Bring? 39

Procedures
In-depth interviews were conducted by ﬂuent, bilingual, male and female Somali
researchers in the language and place preferred by the interviewees. Most wereinterviewed at their home in Somali with notes made in English, which were typed assoon as possible afterwards. The entire sample was unwilling to be audio-taped so
extensive notes were made instead. Most topics were straightforward and concrete sothere was little problem interpreting and noting what was said (unlike interviews about
mental health, for example, Guerin et al., 2004). Descriptive statistics were calculated
for appropriate data and qualitative responses were reviewed for themes. The interviews
were conducted between April 2002 and June 2003.
The method of interviewing was to “talk around” the topics rather than to ask sequentially
ﬁxed questions. This follows recommendations by Pe-Pua (1989) for indigenous
research, based on the Pagtatanung-tanong or “asking around” method she used with
Filipinos. The method is such that questions are asked in a natural conversational context,
so participants feel like they are having a chat rather than being interrogated. This isimportant for refugees since they have aversive histories in most cases with government
and military interviews. The information sheet was translated into Somali but because
many do not read the language (it was only put into written form in 1972), the interviewer
also discussed the sheets with each participant. Similarly, the questions and themes
were written in English but were talked through in either Somali or English depending
upon the language preference of the participants.
In addition to some demographic questions, participants talked about their education andqualiﬁcations, their current income and work, and details about their jobs before arriving
in New Zealand, including whether these jobs required a great deal of communication.
They were also asked about the jobs they had in New Zealand, and what they felt has
made it difﬁcult for them to gain employment.

Results
Employment Background
For the 35 men, 19 had no formal qualiﬁcations, six had Diplomas or Degrees (animal
science, business (2), nursing, public administration, computing), one had a two-year
automotive engineering qualiﬁcation, and nine had a High School Certiﬁcate equivalent.
Of those with no qualiﬁcations, ﬁve were currently completing degrees or Diplomas,
and one had almost ﬁnished a Law degree before it was interrupted by the civil war
in Somalia. Of the 55 women, 48 had no formal qualiﬁcations, six had Diplomas or
Degrees (accounting, nursing, midwifery, machine operator, hair dressing, business),and one had a High School Certiﬁcate equivalent. Of those with no qualiﬁcations, four
were currently completing qualiﬁcations. Two women also pointed out that they had

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40 Ruth Nettle, Mark Paine and John Petheram

done all the accounting for their own businesses in Somalia but there were no formal
qualiﬁcations needed and currently none that would recognised all their practical work.
For the 35 men, only six had their income from fulltime employment: one as a taxi driver,
one in the computer industry, and four working in freezing works (usually as halal slaughtermen). Overall, 83% were not in fulltime employment. Of the others, 26 had their mainincome from government unemployment beneﬁts, and three from student allowances for
tertiary education. Examination of part-time employment found that only 17 out of the 35(49%) were unemployed and with no part-time employment, while one of the students
and 10 of the others had part-time employment with their allowance or beneﬁt.
For the part-time employment, the total sample had at one time or another held 59 jobs,
making an average of 1.7 jobs per man. This ranged from no jobs ever up to ﬁve jobs
held at some point. Considering that they had been in the country on average for 4.5
years, that some were students, and that some were older or with disabilities, this does
not look as bad as the 83% unemployment would suggest. The part-time jobs included
fruit picking, fruit/mushroom packing factory work, car groomer, management supervisor,
meat works, car groomer, supermarket, plastics factory, working for a drug company,
service station work, taxi, checkout, sports coach, chicken processing, computerlabels, forklift, hall job, teaching aide, teaching/liaison person, laboratory work, and milk
production factory.
For the 55 women, none obtained their income from fulltime employment. One woman
had household income from her husband’s fulltime job, 38 (69.1%) had householdincome from government beneﬁts, ﬁve from beneﬁts for sole parents, eight from a student
allowance, one lived with her sister but did not say where the household income camefrom, and two did not answer this question.
The women did a great deal of part-time work, however, with a total of 60 jobs. This was
unevenly distributed (unlike the men) and about half the women (28) had never had a job
at all. Of the 37 women who had jobs, this meant that they had an average of 2.2 jobs
each, more than the men. The part-time jobs included: fruit picking, grading and packing(apples, mushrooms, kiwifruit, asparagus, blueberries), cleaning houses, checkout work,
planting wood, and charging some board for ﬂatmates. The main employment for womenwas seasonal fruit picking and processing, and many had undertaken this hard work
regularly for some years.
Barriers to Employment
Participants were asked about the barriers they had found to getting employment. A
couple reported no barriers:“I have a job. I believe I can get a job if I want one.” (26 year old man)

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What Skills do Somali Refugees Bring? 41

Most reported barriers, however. The majority of the men answered that lack of English
and lack of qualiﬁcations were signiﬁcant barriers. Some also reported discrimination
as a problem. Many women answered similarly in that English and qualiﬁcations were a
problem but more answered that they had family commitments and were not looking forwork.
Some believed that they had been discriminated against in getting jobs, either becauseof their age, their skin colour, the way that they dress, the lack of formally recognised
qualiﬁcations, and their lack of English skills. More women (24 out of 55) also reported
discrimination as a problem and in particular the way they dress was an issue for many
employers.
“There are not enough jobs around some places; it is hard to get a job becauseof my colour / race.” (30 year old man)
“Also employers have a negative attitude towards employing Somalis as they
view Somalis as not good employees.” (22 year old man)
“Mostly I guess it’s the way I dress puts them off, and some cases like my last
job when I went to apply I had lots of layers of clothing but when I started working
they told me to wear pants which was not mentioned during the interview. So it’s
like blackmailing you emotionally. I disagreed and told them you didn’t mention
in the contract and I’m not going to agree with you. I was lucky I wasn’t ﬁred but
I don’t expect them to give me a job in the future.” (20 year old woman)
Many reported that they had family commitments that either precluded them from mostemployment or took up most of their time. This was more common among the women(although not exclusive to the women).
“The most [barrier] is child care. I have four children under the age of seven,
we are living on a single income, so having child care is very expensive, andI don’t have any qualiﬁcations even if I work I can’t earn more than $8 hr. So I
will not be able to get well paid job to cover my child care cost & transport. Pluswith the way I dress with veil there aren’t any job opportunities in NZ.” (26 year
old woman)
As expected, poor English proﬁciency was a common barrier for working in New Zealandsettings, although some women pointed out that English was not imperative in a numberof jobs they were not given.
“I can’t even do my grocery shopping without an interpreter, how can I apply forany job? I need to learn the basic things ﬁrst, like communicating in English.” (54year old woman)

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42 Ruth Nettle, Mark Paine and John Petheram“Simply because every one thinks I’m a walking tree who cannot follow the
simplest instructions like picking blueberries; it’s my arms that pick the fruits andnot my mouth. I’m so angry about the whole issue of job seeking because there
isn’t any for me.” (57 year old woman)
Also as expected, not having the recognised qualiﬁcations for employment or not having
experience in New Zealand situations was often mentioned as a barrier to employment
by both men and women.
“Not having a New Zealand qualiﬁcation is my biggest barrier.” (37 year old
man with an overseas Diploma in Animal Science)“No English, no qualiﬁcations, my skills aren’t needed here as there isn’t any
pastoralists and nomadic people.” (48 year old woman)Some participants reported that there were either not enough jobs around, or that others
got preference over them because of the scarcity of jobs.
“I’m experienced in retail business, but I can’t do that because of my clothing
and no opportunities of what I used to do.” (52 year old woman)“I don’t know, but sometimes I feel that I’m always going to be third best. First
it’s white-NZ, second is NZ Maori, and then I go to number 3.” (21 year old
woman)“Language, also not enough jobs in Hamilton, only seasonal work.” (22 year
old man)Many women reported that the ethnically way they dressed was an issue for employers,sometimes for interfering with the work and sometimes merely because their dress
code were unusual for New Zealanders.
“I think mostly is my dress code, as a Muslim and race because of my colour, and theemployers presume I don’t have enough English. And also my lack of professional
qualiﬁcation e.g. nurse, social worker etc.” (26 year old woman)“…and again if employers think that I’m going to suffocate during summer becauseof my layers of clothes, then don’t feel sorry for me, because it’s my comfort zone.”(57 year old woman)

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What Skills do Somali Refugees Bring? 43

Previous Employment
Table 1: Employment Prior to Coming to New Zealand for Somali Men and Women

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44 Ruth Nettle, Mark Paine and John Petheram

The results so far suggest that some of the well known barriers are present in thispopulation and a few other problems have been revealed. One of the aims of the study
was also to investigate what skills the interviewees had in Somalia and what prevented
the transfer of those skills over to New Zealand. Participants were therefore questioned
about previous employment prior to arriving in New Zealand. We found much diversity
in prior employment experiences. Table 1 presents the main occupations of the 20 men
and 15 women who had jobs prior to New Zealand. Most of the others were too young
to have worked at that time.
Some of these were set up as businesses, although everything was done informally:“I was self-employed, I had a restaurant where I was a cashier and supervised
the daily function of the restaurant.” (42 year old woman)This particular case was a big operation although this counts for nothing with New
Zealand businesses:“I was a cashier in Somalia and I started my restaurant by just selling tea in frontof my house, then I built a makeshift hut where all the interstate truck drivers could
stop for tea and refreshments. Then that gave me enough money to rent premises
on site, I ended buying the property and turned it to a major restaurant chain. But all
this does not apply as qualiﬁcations in NZ.” (42 year old woman)
Other operations were completely informal:“I can’t say I used to work in an ofﬁce but looking after over 500 goats, 50 cows,
30 camels was more than a full time job, and sometimes in the process of looking
for pasture involved dusk to dawn and being very far from the shops and town, so
sometimes I would also buy big sacks of different rations e.g. sugar, ﬂour, rice andsell to other pastoralists who will pay twice the price.” (69 year old woman)“I used to sell bulk food that was not available in Somalia e.g. sugar shortage meant
starvation in Somalia so I will travel to neighbouring countries and buy tonnes ofsugar and sell it in Somalia and it was worth a fortune.” (66 year old woman)
The other women were: nurses, machine operators, physiotherapist (unqualiﬁed), andone teacher.
“I was mainly teaching women who have lived in semi-arid zones what crops to plantthat can survive during famine. Yes, it was mainly speaking and giving directions in
Somali.” (57 year old woman)

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What Skills do Somali Refugees Bring? 45

Inspection of these prior employment histories of both men and women shows a numberof interesting properties about previous jobs. These include: speaking in Somali, social
networking, negotiation skills, the importance of over-land trade routes, multiple jobs
and (legal) informal economies, knowledge of regional-speciﬁc trade, and the differencesin legal and bureaucratic requirements. Some comments will be made about each ofthese.
Those participants who had previously worked in Somalia, 19 men (two said no as both
had been truck drivers) and all the 13 women (two did not answer) stated that theyrequired good language skills, coupled with good casual or informal social skills. As one
woman stated:“If I opened a shop in NZ and I never spoke to any customer when they spoke tome, how many would come to the shop? So for me it’s purely language.” (46 year
old woman)
The majority reported that they also need to speak a number of languages, in particular
Somali, Swahili, and Arabic, in their prior jobs. Only two mentioned English as alanguage they had used regularly and for one the participants, they only used the romannumerals.
Most of the jobs involved close social networking to form import and export partnerships
and to establish relationships with customers. In order to inﬂuence partnerships andcustomers, the participants noted that it requires a thorough command of a range of
informal skills conducted in informal settings within the context of Somali and neighbouring
regions. It also requires a good understanding of people and communities and how thesocial organisations work. That is, it was not only important to have a good grasp of thelanguage in their prior employment, but it was also important to be socially skilled in
informal settings. Even those who now have good command of the English language do
not have this informal ﬂuency and ability in colloquial English.
The prior jobs also required a strong need for negotiation skills which once again requirea strong command of the regional dialects and informal languages. For example, theparticipants needed to negotiate prices for both buying and selling of goods in a variety
of settings. The buying and selling operations in Somalia were frequently built aroundcommodities speciﬁc to the region, with some saying how they took advantages of local
demand. Many were also not in competition (at least at that time) with large multinational
food supply companies selling basic food items cheaply (rice, sugar, ﬂour, etc.).
A number of participants also noted that in their previous businesses they had used
extensive African trade routes, most of which were overland. For example, goods may
be bought in one country, sold in another, other goods purchased and sold again in
the original country. Operating businesses using these trade routes was very different

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46 Ruth Nettle, Mark Paine and John Petheram

compared to operating a trading business in New Zealand, in which trade is conductedprimarily with overseas buyers or sellers. Trading overland was often less difﬁcult giventhat the participants had easier access to different countries and transport compared tothe difﬁculties associated with New Zealand’s geographical isolation and its bureaucratic
requirements for international, overseas trading. The participants were clear that there
were few bureaucratic or legal rules concerning running a business in their country oforigin. Rules and forms for starting a business were minimal, and no business or safety
plans were required. One simply began buying and selling and hopefully this worked andexpansion occurred. Small (legal) informal economies were common.
Finally, many of the participants had multiple jobs in North Africa and took advantage
of opportunities. Interviews in previous studies indicated that Somalis would travel to
Saudi Arabia or elsewhere for seasonal or longer work and send money back home tofamilies.

Conclusions
The study reported in this paper was conducted with one refugee group in one city, but
the issues surrounding barriers to employment raised in the study are worth repeating
elsewhere. In particular, although the participants reported commonly found barriers
to obtaining work and employment other than low paid, non-standard and precarious(namely, language knowledge, qualiﬁcations, and discrimination), there are other barriers
that have more to do with intangible skills, such as interpersonal communication, social
networks and regional knowledge, which have been frequently overlooked as importantin the extant literature.
The ﬁndings show that insufﬁcient communication skills are still a problem for many ofthe participants, even after living in New Zealand for a number of years, which suggeststhat the current services may not necessarily be providing adequate training in this area.
Having a good knowledge of the subtle interpersonal skills and processes – skills that do
not transfer easily into a culturally different and developed country with a new language,(such as New Zealand) – is essential when trying to establish social networks in a new
country. It was not surprising, therefore, that the participants reported that they had
had limited social networks in New Zealand, compared to their extensive networks in
Somalia. The ﬁndings also show that the informality of the Somali commerce was very
different compared to New Zealand; for example, there are few rules for establishing andrunning businesses, the informal communications and networks are different and there isa tendency to conduct multiple, informal business arrangements simultaneously in orderto obtain an overall income rather than a single wage or salary. Overall, the participants
were hampered in their ability to gain employment, obtain positions similar to thosethey had in Somalia, or start their own businesses in their adopted country because of
their lack of knowledge of New Zealand’s commercial laws, their limited networks, theinsufﬁcient knowledge of colloquial English and informal, cultural communications – skills

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What Skills do Somali Refugees Bring? 47

mastered in Somalia and which are essential in business.
The ﬁndings also prompt a number of recommendations. Firstly, small business mentors
should provide information on New Zealand’s commercial laws and regulations to thosewishing to start their own business as well as be cognizant of the limited informal networks
that most Somalis have in their newly adopted country. In addition, by including a mixof both formal and informal properties, assessments can be used more effectively tohighlight the lack of knowledge of New Zealand commerce and informal communicationin certain migrant communities and explore more creatively the transfer and applicabilityof skills.
Secondly, in the short-term it would be wise to ﬁnd employment that could circumvent
having to learn all these new skills rather than waste them completely as happens atpresent. In this particular Somali community, a number of new initiatives have arisen
for small or informal employment opportunities. These initiatives include Koran teaching,small clothing trades, making and then selling incense, and selling some foods in a smallway (e.g., one member of the community once made a large, one-off pasta import andsold it locally to Somali). However, while these business initiatives provide some relief inthe ﬁrst instance, they are problematic as they are located within the Somali communityand do not attempt to expose the Somali community to the wider economy in which theylive. The problem with this is that it is either not sustainable as employment or else will
only support a few people in this way. One cannot open ten dress shops for primarily
Somali clients in one, small New Zealand city. There are, however, a few initiatives
that are beginning to extend the working experiences of Somalis. For example, some
Somalis are applying previous business skills and experience to taxi companies in New
Zealand in which an excessive amount of English and western bureaucratic acumen are
not necessarily required. However, more research is needed to determine how well thesebusinesses are doing and how they are coping with the bureaucratic rules of running abusiness in New Zealand.
Secondly, what are missing are interventions to enhance the whole social and businessnetworking and the informal, conversational ties that characterise small-scale businesses(Guerin, 2004, 2005). If businesses are to be sustainable in small cities, then the larger
population needs to be accessed as a market, and restricting business to Somali speakers
or contacts through Mosques will not be viable. One way might be for businesses tomentor speciﬁc Somali individuals with excellent English skills into the business social
networks available, to be the up-front person. Others working in the Somali side of thebusiness need not have the same level of informal conversational and negotiation skills if
individual representatives could be mentored and trained. It could also be an advantage
in business circles to be known as the Somali representative and this would certainly be
noticed and remembered, and would be good for future marketing.
Finally, the employment issues for Somali women in New Zealand suggests the need for

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48 Ruth Nettle, Mark Paine and John Petheram

re-skilling programmes that are scheduled at times suitable for women who are meetingthe demands of large families. The skills of managing large families and households
could also be fostered through setting up child care and kindergarten programmes with
cultural and religious emphasis for women who want to work but have small children.
In all, there are good possibilities to go beyond the large unemployment and sizable
part-time employment status of most refugee groups, and move into more sustainableself-employment. This will not only require adapting the skills already possessed themigrants but also ﬁnding ways to utilize such skills in a new context. We are hopefulthat other adaptations of skills can be made at a more micro-level with individual cases iffollowed though. To this end, it would be useful for future research to look at interventions
that incorporate the prior employment skills into a New Zealand context. This could
include learning about the social organisation and social networking opportunities in New
Zealand, as well as practice with informal English.

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Changes in Working Hours for Couples 51

Changes in paid working hours for couples,1986 to 2001
PAUL CALLISTER*

Abstract
In New Zealand, the weekly paid hours worked by individuals have generally not been
considered within the context of working hours of other adults who may live in the same
household. Using census data between 1986 and 2001, this study focuses on total usual
hours of paid work for couples. The research shows that, for individual workers, while
average hours of work have not changed much, there has been growth in both shortand long weekly hours of paid work. The increase in working hours shows up morestrongly in couple data than in individual data. This reﬂects both an “added worker” effectand changes in hours worked by individuals living in couples. The data also show that
individuals and couples who work the longest paid hours tend to have the highest incomes.
Finally, international comparative data indicates that New Zealand is amongst a group ofcountries at the upper end of the spectrum in terms of the proportion of individuals andcouples working long hours.

Introduction
The Department of Labour has become increasingly interested in the Future of Work andinvestigating work-life balance policy options. As part of this interest, Grimmond (2003)
explored a number of changes in work hours for individuals over recent decades as partof his scorecard of labour market performance. Using Household Labour Force (HLFS)
data, and based on a measure of usual median hours of paid work, he showed thatbetween 1986 and 2001 male hours stayed steady at around 41 per week, while medianfemale hours decreased slightly from 35 to 34. In addition, the HLFS data indicated for
women and men a downward trend in the proportion of individuals working under 40hours per week, and an upward trend in those working more than 40 hours. Grimmond
also undertook some preliminary analysis to determine if workers were putting in longer
hours to compensate for a lack of increases in wages. He concluded that the increases
in hours worked appeared to have been largely voluntary and were not a response to alack of wage growth.

* Paul Callister, Institute of Policy Studies, School of Government, Victoria University of Wellington.
A research grant from the Department of Labour’s Future of Work Contestable fund enabled this research to be carriedout.

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52 Paul Callister

Using Grimmond’s work as a springboard, this article examines the changes in working
hours for both individuals and households and the reasons behind the changes, in orderto aid policy development. The main focus in the article is on changes in total paid working
hours for couples during the same time period as Grimmond’s study – between 1986 and2001.1 However, the source of data is the census rather than the HLFS.

Why Couples?
A great deal of useful information can be obtained from analysing the work patterns ofindividuals. Yet, a signiﬁcant proportion of adults live with other adults in households,
mainly as couples. Research in a number of countries has demonstrated that there
has been a growth in both “work-poor” (neither partner has a job) and “work-rich” (bothadults have a job) couple households amongst those in prime working ages (OECD,
1998; Gregg & Wadsworth, 2002; Singley & Callister, 2004). This type of measureprovides a crude indication that, across society, there has been a concentration of paid
employment at the household level. The concentration of paid work in couple households
is linked to changes in both men and women’s employment patterns, as well as being
an outcome of assortative mating that brings people with similar characteristics together.
In the US, research has indicated that when couples are the unit of analysis, increases
in employment rates by partnered women, (that is, adding an additional worker to thehousehold), have lead to quite dramatic increases in the total working hours of couple
families. Yet, hours worked by individuals in the US have not changed that much (Matz& Pitt-Catsouphes, 2003).
Dual-earner couples are the focus of much of the work-life balance research in the U.S.
(e.g. Clarkberg & Moen, 2001; Jacobs & Gerson, 2001; Jacobs & Gornick 2001). In dualearner, childrearing households, long hours of paid work may restrict parental time with
their children. For couples without children, long hours can lead to stress and the couple
having little shared time together. Yet, some of the international literature suggests that
there has also been a polarisation of hours of paid work among couples. While a groupof couples are working long hours, others are working relatively short hours.
Finally, understanding total hours of work for couples can be important when considering
the possible introduction of regulations to place a “cap” what are deemed to be excessive
working hours for individuals. For example, in a couple with children, one partner may
work 55 hours a week with their partner at home looking after the children full time. If a
cap was placed at 48 hours, as in the UK, then the main earner would have their hours
reduced. This may result in this worker spending more time with their children, but islikely to reduce total family income. In contrast, a couple where both partners worked 45
hours would not have their working hours capped, yet potentially would be spending 35

1

Some of the interactions between paid and unpaid working hours for couples are explored in Callister (2005a &b).

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Changes in Working Hours for Couples 53

hours more hours per week away from their children. If schemes are to be devised toensure children have more time with their parents, both individuals’ and couples’ hours
need to be considered.

Previous New Zealand, Australian and US Research
There has been no in-depth research in New Zealand on working hours for couples.
However, using census data between 1986 and 1996, an initial exploration of changes
in usual working hours among New Zealand couples aged 25-59 (based on the woman’sage) indicates some polarisation in hours (Callister, 2000). More detailed research carriedout in the US and Australia in recent decades suggests some polarisation of hours forcouples (in Australia ABS 2003; Burbidge & Sheehan, 2001; in the US Jacobs & Gerson,2001). Based on their ﬁndings, Jacobs and Gerson (2001) also argue that researchersand policy makers need to focus more on work patterns in a family rather than just an
individual context.
Australian research between 1986 and 1996 indicates that education and presenceof dependent children are important variables when studying the polarisation of work
amongst couples. When changes in hours worked for couples with children by qualiﬁcationof husband were investigated, it was found that some polarisation of work within couples
had occurred at all qualiﬁcation levels (Burbidge & Sheehan, 2001). However, the growth
in long hours of combined work was strongest where the husband held a bachelor or
postgraduate qualiﬁcations. In contrast, the growth in short hours (under 20 hours of
joint work) was strongest where parents had no post-school qualiﬁcations. The dataalso showed that long hours of paid work were more common amongst couples withoutchildren than amongst those with them.
In summary, the US and Australian research indicates that:• Average hours of work have not changed much for individuals, but there has
been a polarisation of hours with growth in both short hours and long hours of
paid work.
• “Overwork” tends to show up more strongly in couple data than in individual
data.
• The longer total hours of work in couple households has been primarily due toincreases in women’s employment rates.
• Qualiﬁcations are important in hours of work both at the individual and household
level, particularly in terms of short hours of work.
• Age and presence of dependent children are also very important.
• On average, women, both as individuals and when living in couples, tend towork shorter hours than men.
• Women, nevertheless, have been increasing their share of paid working hours
in couples.

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54 Paul Callister

Data and Methods
As noted, the focus of this article is on changes in working hours for couples between the1986 and 2001 Censuses of Population and Dwelling. The censuses provide a record ofusual weekly hours of paid work, with individual hours recorded. Total work hours in alljobs are used in this research.
Age is an important variable in this research. Dealing with age for individuals is
straightforward, but deﬁning couples by age creates some conceptual challenges. In thisstudy, couples are deﬁned by the age of the female partner. In addition, only opposite-sex
couples are considered.
Data are presented on averages, as well as long and short hours of paid work. For
individuals, average hours could be calculated in two ways 1) average hours for all
individuals including those not working 2) average hours only for those in paid work(and only those who recorded actual hours). In this article, the latter measure is used.
For calculating average hours of couples, only those couples who were linked into paid
work were included (that is, work poor couples were excluded). This means calculationof hours worked for employed couples includes both couples where one partner was notin paid work and those where both partners were working.
There are some different cut-off points used by international researchers in terms of
deﬁning short and long hours for individuals. For individuals in Australia, the US andthe UK, 48 hours or more per week are usually considered to be long hours. For thisresearch, 50 or more hours per week are used. This was the cut-off point used by the
Ministry of Social Development in its 2003 Social Indicators Report. For short hours ofwork for individuals, a somewhat arbitrary fewer than 20 hours per week of paid work
is used. This is ten hours shorter than the ofﬁcial deﬁnition of part time work in New
Zealand.
Where couples are concerned, there are some variations in the cut-off point used in
the international literature. In Australia, Burbidge and Sheehan (2001) used 90 or more
hours of combined work as an indicator of long hours, and under 20 hours of joint work
as an indicator of short hours. In the US, Jacobs and Gerson (2001) used 100 hours ofcombined work as an indicator of long hours. In this New Zealand research, under 30hours of combined work is used as an indicator of short hours. For long hours, 100 or
more hours is used.
In this article, there is some exploration of the association between education andincomes and changes in hours worked by couples using a broad 25-59 age group. In
terms of income, deciles of yearly income, which includes income from all sources notjust the labour market, are used. With regards to education in couples, three groups

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Changes in Working Hours for Couples 55

are used: both partners have a degree or higher, neither have a qualiﬁcation, and othercombinations of qualiﬁcations. Finally, some data are presented on how women’s share of
total couple working hours has changed between 1986 and 2001. Additional informationon the methodology can be found in Callister (2004).

Results
Changes for individuals
To set the couple data in context, this section brieﬂy summarises changes in work forindividuals. Overall, across society, average hours of paid work for those employedchanged relatively little in the 15 years between 1986 and 2001. The average hours formen declined by just under half an hour, while for women the decline was just under anhour. However, there were some signiﬁcantly larger declines in average hours worked
amongst some age groups, notably those 15-24 and those 85 and older (although thislatter group is very small). The strongest increase in average working hours of theemployed over this 15-year period was amongst women aged 45-54, with an increase ofjust over two hours worked per week.
However, averages disguise changes in the distribution of hours of paid work. For men
aged 15 and older, in almost all 10-year age groups there was a growth between 1986
and 2001 in the proportion working under 20 hours per week as well as an increase in
the proportion working 50 or more hours. For women there was a slightly different patternof changes between 1986 and 2001. In some age groups (25-34 and 45-54) there was a
decline in the proportion working less than 20 hours per week. Like men, in the 15-25 age
group there was very strong growth in the proportion of employed women working shorthours. In almost all age groups there was an increase in the proportion of women working
50 or more hours per week. Much of this growth in long hours for men and women took
place between 1986 and 1996 and, in fact, plateaued or even declined for some groupsof men in the subsequent ﬁve years. Given that men are over-represented amongst
those working long hours, this led to an overall plateauing of the proportion of all workers
putting in long hours between 1996 and 2001. However, going against this overall trend,
for other groups, notably women aged 25-34, 45-54 and 55-64, growth continued in the
proportion working long hours between 1996 and 2001.
International comparative data on long working hours show that New Zealand is at
the high end of hours worked amongst industrialised countries. In a comparison of the
proportion of employees working 50 or more hours per week in selected OECD countries
on, or near, the year 2000, Messenger (2004) found that only Japan topped New Zealandin the long working hours’ league. Other comparative research into working hours by
Johnston (2005) and Callister (2005a) lend further support to the view that there is agroup of New Zealanders, particularly men, who, on average, work long weekly andyearly hours of paid work.

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56 Paul Callister

In New Zealand, when education and hours of work for men aged 25-59 were considered,
there was little difference in average hours by level of formal education in both 1986 and2001. For these men, while there was growth amongst all educational groups in the
proportion working under 20 hours per week, in 2001 such work was more common
amongst those with no formal qualiﬁcations. A stronger pattern in relation to education
emerges for prime working-aged women. Well-educated women showed the strongest
increase in working hours over the 1986 to 2001 period.
Finally, in line with Grimmond’s ﬁndings, when personal income was considered thedata show that for prime working aged men and women there was a strong relationshipbetween decile of personal yearly income and weekly working hours in both 1986 and2001. However, this relationship became stronger between 1986 and 2001. In 2001 thoseindividuals working the longest hours generally had the highest income.
Couples
To set the context of changing hours within employed couples, in the age range 15-54
there was a decline between 1986 and 2001 in the proportion of couples where one orboth worked (that is, there was an increase in the proportion of work-poor couples). In thesame time period, there was an increase in employed couples in the 55-84 age groups(that is, a decline in work-poor couples). The increase in couples where at least one
partner was employed was particularly strong in the 55-64 age group.
Changes in average total work hours for couples provide some initial guide to the directionof change. Table 1 shows changes in total average combined hours worked by employedcouples in 1986 through to 2001. Included in this particular table are also average hours
for the intermediate censuses of 1991 and 1996. These additional data show that, inmost age groups, there was not a marked variation from a trend over the whole time
period. [This was despite some signiﬁcant growth in the proportion of work-poor couples
from 1986 to 1991 (Singley & Callister, 2004) – reading this makes me think this should
be cut – this trend it not part of the data shown in Table 1 but as it stands it kind of implies
it is]. In the age groups where the changes in average hours worked for couples were thestrongest, the trend was a gradual increase in the total average hours worked between
each census. Overall, Table 1 shows that average hours for couples in the broad age
group of 25-84 years increased, with the strongest growth in couples where the female
partner was aged 25-34, 45-54, or 55-64. While these patterns primarily reﬂect changes
in women’s employment rates, they also are inﬂuenced by changes in working hours forsome individuals.

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Changes in Working Hours for Couples 57

Table 1: Average combined hours worked per week for employed couples by ageof female partner, 1986 to 2001

When actual combined hours are considered, a number of key trends show up. These
include:•••In all age groups there has been a decline in the 40-45 hour peak of combined
hours. This primarily reﬂects the decline in couples where there was just one
full-time worker. Where hours for couples increased, this has often been due toan “added worker” effect.
In the 25-34, and 55-84 age groups there has been an increase in the 80-85
work hour peak. This primarily reﬂects the increasing numbers of couples inthese age groups where both work 40-hour weeks.
In 2001, in the 10-year groups within the broad 25-54 age span, the 80-85
hours of combined work peak is larger than the 40-45 hour peak.

While many couples work approximately 80 hours of combined work per week, growth
has also occurred in longer combined hours. The data in Figure 1 show changes in the
proportion of couples working 100 or more hours per week occurred across the four
census periods. It indicates that growth in the long end of the working hours’ spectrum
for couples took place throughout the whole period for those aged 45-54, 55-64 and, to alesser degree, 25-34. Again, this primarily reﬂects changes in women’s rather than men’spatterns of work.

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58 Paul Callister

Figure 1: Proportion of employed couples working 100 or more hours of combined
work per week in each age group, by age of female partner, 1986 to 2001

Although in each age group, single people and couples without dependent children are
more likely to work longer hours than couples with dependent children, in 2001 there wasstill a signiﬁcant number of couples with dependent children who worked long hours. In
2001, in the broad 15-54 age group, there were 35,000 couples without children who
worked 100 or more hours per week, but 32,000 with children. In the group with children,
couples where the youngest child was in their teenage years tended to work the longest
combined hours.
There are relatively few couples where the 100 or more hours of combined work comefrom both partners working 50 or more hours per week. However, in 2001 when women’s
hours were considered, men were more likely to work long hours if their partner also
worked these hours. For example, in the 25-34 age group, in couples where the female
partner worked zero hours (i.e. was either unemployed or not in the labour force) 37
percent of the male partners worked 50 or more hours per week. In those couples where
the female partner worked 50 or more hours, 59 percent of their male partners did
likewise. At the other end of the prime-working-age spectrum – the 55-64 age group – theﬁgures were 26 and 67 percent respectively. This undermines the notion that long hours
are generally worked by one partner to compensate for short hours by the other.
Table 2 explores the association of education with changes in working hours among
couples aged 25-59. It shows that, in both 1986 and 2001, it was the well-qualiﬁed
couples that worked the longest average hours. In addition, while there was an increase inaverage hours worked in all educational combinations, the slowest growth was amongst
couples with no formal qualiﬁcations. These trends link into occupational data, where
it has been found that long hours of work are particularly common in managerial andprofessional occupations. However, other data show that while well-educated couples

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Changes in Working Hours for Couples 59

work, on average, longer hours they are only marginally over-represented amongst thoseworking very long hours (Callister, 2004). Again, this may link to occupational patterns,
with relatively unqualiﬁed groups such as farmers or ﬁshers, working very long hours.
Table 2: Average hours worked per week by employed couples in each highest
qualiﬁcation gained category – Women aged 25-59, 1986 and 2001

While having children is associated with a reduction in total hours worked by couples, thereduction is highest amongst those couples with higher qualiﬁcations. However, overall,in 2001 well-educated couples with children worked, on average, longer hours thanchildrearing couples with no formal qualiﬁcations, and almost the same average hours
as non-childrearing couples with no formal qualiﬁcations. These patterns are illustrated
in Figure 2.
Figure 2: Average weekly hours of paid work for employed couples with in eachhighest education category and presence of dependent children – Women aged
25-59, 2001

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60 Paul Callister

These patterns also show up when a narrower age range for parents is used and only
couples with preschool children are considered. For example, between 1986 and 2001
for couples where the female partner was aged 25-34 and where both partners held
degrees or higher qualiﬁcations, average hours increased from 57 to 61 per week. For
couples with no formal qualiﬁcations, there was still an increase in working hours, butfrom 55 to 57 hours per week. In 2001, 23 percent of the well-qualiﬁed couples worked
80 or more hours per week, while the ﬁgure was slightly lower at 21 percent for poorly
qualiﬁed child rearing couples.
In terms of yearly couple income, in 2001 there was an overall (although uneven) gradientin average total weekly hours worked by couples, with the longest hours tending to be put
in by the couples with the highest yearly income (Table 3). This gradient became more
pronounced in 2001 than it was in 1986.
Table 3: Average hours worked per week by employed couples in each decile ofcouple income–Women aged 25-59, 1986 and 2001

Figure 3 shows only 2001 data and illustrates the association between yearly income
and the presence dependent children with the average weekly working hours of couples.
In a similar, (and no doubt linked), pattern to that of education, in 2001 the gap between
average hours worked by high-income couples (both with and without children) was
relatively large compared with those of low-income couples. Having dependent children
reduces average hours worked in all deciles, but by the least amount in the bottom decileof income.

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Changes in Working Hours for Couples 61

Figure 3: Average total hours of employed couples in each decile of income forthose with and without children –Women aged 25-59, 2001

While the data do not rule out the notion that a group of poorly educated, low income
earning couples may be being forced to work long hours due to economic necessity, thelargest increase in average hours worked appears to have come about within the higher
educated and, generally, higher income couples.
Women’s hours as a proportion of total working hours for couples were then considered.
The increasing employment of partnered women, as well as the higher proportion of
women working long hours, was likely to lead to women working a higher proportionof hours within couples. This is conﬁrmed by the data. There was an overall shift in the
distribution worked by women relative to men in couples where the female partner wasaged 25-59. One measure of this shift is where women work half or more of the hours
in the couple. In 1986 just under 20 percent of women in prime working aged couples
contributed half or more of the hours work. By 2001 this had risen to 28 percent.
Finally, while international comparisons always need to be treated with some caution
due to methodological problems, Table 4 compares average combined hours worked
for couples across a number of industrialised countries. The table also compares thenumber of couples where both partners were employed. Like the international data for
individuals, these data suggest New Zealand is at the higher end of the spectrum interms of hours worked for couples.

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62 Paul Callister

Table 4: Joint average hours of paid work for non-agricultural employed married
couples aged 25-59, selected industrial nations

Note: The source of all non-New Zealand data is Jacobs and Gornick (2001). There are some differences in how thedata were calculated between countries. The main one is that in some countries, including New Zealand, both defacto
and married couples are included. In all countries the couples included are those where at least one partner was in paid
work. In New Zealand, agricultural workers -ANZSIC Industry - Agriculture, Forestry and Fishing - were removed from thecalculation to make the data internationally comparable. In addition, both partners needed to be in the 25-59 age group.
Finally, the New Zealand and international data is rounded to the nearest hour or percentage.

Discussion
Not surprisingly, most of the trends in hours of paid work for individuals and couples
already found in the UK, the US and Australia can be seen in New Zealand data. However,
New Zealand appears to be at the high end of the spectrum internationally when longweekly hours of work are considered for both individuals and couples.
Census data do not give a deﬁnitive answer as to whether the increasing hours for somegroups of New Zealanders are due to economic necessity rather than choice. However,they do lend support to the preliminary analysis that Grimmond undertook to determine
if individual workers were putting in longer hours to compensate for a lack of increases
in wages. His conclusion that the increases in hours worked appear to have been largely
voluntary and were not a response to a lack of wage growth seems also to be on the wholecorrect when couples are the unit of analysis. Yet, some of the increasing employment
rates and hours put in by women in couples are likely to be linked to poor labour market
prospects for a group of low-skill, low-income men, and a subsequent need to raise
couple income. It is also possible that some workplaces are creating long working hour“norms”, thereby restricting choices even for those individuals with apparently stronglabour market negotiating positions. More research is needed in order to understand why
a group of New Zealanders are working long hours.

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Changes in Working Hours for Couples 63

While a more complex, census-based, multivariate analysis of the changes in working
hours for couples might provide a greater insight as to why hours have been changing,a better understanding is likely to come from different data sources. Moreover, although
there is an expanding international literature on individual preferences of working hours
in most countries, including New Zealand, we still do not know what the total combined
working hour preferences of couples are.
Time use data could also be used to study the working patterns of couples. For a signiﬁcantnumber of couples in the New Zealand time use dataset, information is available on bothpartners. These couple data have yet to be used by researchers. Issues such as joint
patterns of both paid and unpaid work could be explored, as well as the gender divisionof paid and unpaid work within households. This, in turn, would assist our understandingof inequalities in hours of employment and earnings between women and men.
Researchers also need to better understand how bargaining takes place within couples,for example how joint retirement decisions are made, and what factors inﬂuence
decisions about working hours among couples with dependent children. This will require
new sources of data.
One potential source of new data is a proposed supplement to the Household Labour
Force Survey that the Labour Department and Statistics New Zealand have beendeveloping. This may include questions on satisfaction with working arrangements andpreferences for working hours. While full data may not be able to be collected for bothpartners in couples, this proposed supplement may, nevertheless, provide some useful,
additional, couple-level data.

Conclusion
Census data from 1986 through to 2001 show that for individual workers, while average
hours of work have not changed much, there has been growth in both short and longweekly hours of paid work. However, the increase in working hours shows up morestrongly in couple data than in individual data. This reﬂects both an “added worker” effectand changes in hours worked by individuals living in couples. Given discussions in early2005 about further lifting participation in the labour market of women aged 25-34, unlessmen’s hours of work reduce, there is the potential for average hours worked by couples
to further increase (Callister 2005a).
While, as yet, we do not have strong evidence that a signiﬁcant number of thoseindividuals and couples working long hours would prefer shorter hours of paid work,
there is nevertheless concern in New Zealand about the possible negative effects of‘overwork’. This has prompted the introduction of a private members bill into parliamentin mid 2005 that aims to give parents of young children more negotiating power overtheir hours of work. This proposed legislation is based on legislation introduced in the

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64 Paul Callister

UK in 2002 (Callister 2005b).2 As yet, it not clear as to the effects of the UK legislationon either individual or couple hours of paid work. However, even if this bill fails to passinto legislation, it is likely that there will continue to be discussion around the causes andeffects of the long working hours of a group of New Zealanders.
References
ABS (2003). Australian social trends: Work - paid work: Longer working hours, http://www. abs.gov.au/Ausstats/abs@.
nsf/0/f46f5073e7cd46e4ca256d39001bc354?OpenDocument
Burbidge, A. and Sheehan, P. (2001). The polarisation of families. In J. Borland, B. Gregory and P. Sheehan (eds.), Workrich, work poor: Inequality and economic change in Australia, Melbourne: Centre for Strategic Economic Studies, Victoria
University, 119-141.
Callister, P. (2000). Diversity or polarisation? The growth in work-rich and work-poor individuals, families and communities
between 1986 and 1996, unpublished doctoral thesis, Victoria University.
Callister, P. (2004). The future of work within households: Understanding household-level changes in the distribution ofhours of paid work, Department of Labour, Wellington. http://www.dol.govt.nz/futureofwork/
Callister, P. (2005a) The changing distribution of paid and unpaid work in New Zealand, Treasury Working Paper 05/07,
Treasury, Wellington.
Callister, P. (2005b). Overworked families? Changes in the paid working hours of families with young children, 1986 to
2001, Social Policy Journal of New Zealand, 24: 160-184.
Clarkberg, M. and Moen, P. (2001). Understanding the time-squeeze: Married couples’ preferred and actual work-hourstrategies. American Behavioral Scientist, 44 (7): 1115-1136.
Gregg, P. and Wadsworth. J. (2002). Why we should (also) measure worklessness at the household level: Theory andevidence from Britain, Spain, Germany, and the United States, Centre for Economic Performance Working Paper 1168,
London School of Economics.
Grimmond, D. (2003). A report card on the New Zealand labour market: Improving, could do better, in S. B. Blumenfeld(ed.), Labour, employment and work in New Zealand 2002 Wellington: Victoria University, pp. 1-12.
Jacobs, J. A. and Gerson, K. (2001). Overworked individuals or overworked families? Explaining trends in work, leisure,and family time, Work and Occupations, 28(1): 40-63.
Jacobs, J. A. and Gornick, J. C. (2001). Hours of paid work in dual-earner couples: The U.S. in cross-National perspective,
Luxembourg Income Study Working Paper No. 253, http://www.lisproject.org/publications/liswps/253.pdf
Johnston, G. (2005). Women’s participation in the labour force, Treasury Working Paper 05/06, Treasury, Wellington.
Matz, C. and Pitt-Catsouphes, M. (2003). Overworked individuals or overworked families? Explaining trends in work,
leisure, and family time, Conversations with Kanter Award Recipients J. Jacobs and K. Gerson, Sloan Work and Family
Research Network Research Newsletter, 5(1) http://www.bc.edu/bc_org/avp/wfnetwork/newsletter/5-1.pdf
Messenger, J. C. (2004.) Finding the balance: Working time and workers’ needs and preferences in industrializedcountries - A summary of the report and its implications for working time policies, Paper presented at the 9th International
Symposium on Working Time Paris, 26th – 28th February, http://www.cnam.fr/griot/ComSITT/messenger.htm
Ministry of Social Development (2003). The Social Report 2003: Te Purongo Oranga Tangata 2003, Wellington: Ministryof Social Development, http://socialreport.msd.govt.nz/2003.index.shtml
OECD (1998). Patterns of employment and joblessness: A household perspective, in OECD Employment Outlook,
OECD, Paris, pp. 7-30.
Singley, S. G. and Callister, P. (2004). Polarisation of Employment, 1986-2002: New Zealand in the international context,
Centre for Social Research and Evaluation Working Paper 06/04, Ministry of Social Development, http://www.msd.govt.
nz/documents/work-areas/csre/working-papers/wp-06-04-polarisation-of-employment.doc

2

A useful site for information on British working-hour legislation is: http://www.dti.gov.uk/er/work_time_regs/

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Youth Transition and the Local Labour Market 65

Youth Transition and the Local LabourMarketPHILIP S. MORRISON* & ELIZABETH LOEBER**

Abstract
High levels of unemployment among youth have lead to a heightened focus on thetransition from school to post-school activity. Despite a vast literature on youth transition,
only a few researchers have considered the role of the local labour market. This study
explores the expectations of teenagers near the end of their schooling in two very different
locations in New Zealand: Kawerau and Porirua City. Contrary to expectations from theeducation literature on rural youth it is not those students in the small mill town of Kawerau
who exhibit the lower expectations - paradoxically their aspirations are noticeably morepositive than their metropolitan counterparts in Porirua. The paradox is largely resolvedby the economics literature which draws on the theory of returns to investment in further
education to show how local unemployment levels raise the probability that youth will
choose further schooling over searching for employment.

Introduction
The ﬁrst attempt at job search and initial employment usually take place locally, inthe same town that young people attend secondary school. Surprisingly much of the
expanding literature on youth transition, especially in the education literature, makes little
reference to the inﬂuence of place on the further schooling and employment decisions
young people make in their senior student years.
The aim of this article is to explore how the state of the local labour market inﬂuences the
expectations that youth hold of their immediate and longer term employment prospects,
subsequent education and income. Hypotheses based on the education literaturesuggest that schooling in small relatively isolated labour markets inﬂuences educational,
occupational and income aspirations in a negative way. Without the size to generate
the diversity of opportunity, the market to foster specialisation of occupations or thedemand to maintain high relative wages, small towns will not provide youth with the same
opportunities to work. Schooling in such places can have a negative inﬂuence on student
expectations of future employment, occupation and income.

* Philip S. Morrison, Institute of Geography, School of Earth Sciences, Victoria University of Wellington. Email: Philip.
Morrison@vuw.ac.nz** Elizabeth Loeber was a Master’s student in Development Studies and is currently teaching English in Korea.

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66 Philip S. Morrison and Elizabeth Loeber

In order to test this hypothesis in the New Zealand context we compare the expectationsof secondary school students from two very different local labour markets: the small
pulp and paper mill town of Kawerau and the City of Porirua within the metropolitan
centre of Wellington. We contrasted year 11-13 students in two otherwise similar schools,
anticipating that youth in the small towns would respond to questions about their future
employment in fundamentally different ways from those living in metropolitan centres.
We begin by selectively reviewing the literature on youth transition, paying attention ﬁrstly
to what the education literature says about youth in rural and smaller settlements and thento the economic literature on post-school choice. The research design and methodology
are introduced and the student respondents from the two schools are compared.

Literature Review
Notwithstanding a general disregard of the local labour market in the literature on youthtransition, those researchers who have recognised the signiﬁcance of geography comefrom two largely separate disciplines, education, which tends to focus on the rural/urban
divide, and the labour economics, which focuses more generally on the state of the local
labour market. This division of the literature into education and economics is of course
a simpliﬁcation and is not intended to deny the presence of a substantive literature insociology (see for example, Higgins, 2002) or indeed a growing literature in (mainly rural)geography itself (e.g. Panelli, 2002).
In addition to disciplinary divisions acknowledged here, there is a methodological division
between post-modernist approaches (e.g. Chisholm and du Bois-Reymond, 1993) andthe econometric modelling employed in the educational and economics literature as wellas this article. The post-modern and econometric literatures do not intersect and eachproceeds largely in ignorance of the other. This is a pity because they both have valuable
contributions to make to our collective understanding of the youth transition and theimportance of place among youth (see Smith et al., 2002). The latter is a feature whichis also conscientiously explored in the psychology literature without necessarily being
linked to the youth transition (e.g. Pretty et al., 2003). With these general points in mind,
this article focuses primarily on the mainly quantitative large sample literature.
One of the most important sources of variation in the experiences of young people liesin where they live because of the affect this has on their access to quality education andjob opportunities (Jones, 2002). Those living in disadvantaged neighbourhoods, whether
in urban areas or rural ones, have to be able to get to more prosperous areas to study
or work, or become resigned to the restricted job opportunities available locally. ‘Gettingout’ moreover requires additional ﬁnancial and possible emotional support, whether fromthe state, employers, or family.
It is argued further that many rural youth grow up exposed to formative experiences and

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Youth Transition and the Local Labour Market 67

family structures that are markedly different from non-rural peers (Haller and Virkler,
1993). The increased likelihood of narrow school curricula, restricted local market
opportunities, and fewer college and professional role models inﬂuence rural youth todisproportionately select agricultural, service and manual occupations as adults.
Heckner shows that given the limited range of careers available in rural areas,
incompatibility of career aspirations tend to lower educational aspirations and delay college
entry (Heckner, 1995). The same point is made by (Rojewski, 1999); social networks
facilitate access to job opportunities but in small towns youth lack social networks which
can be an important barrier to employment. Although many of the problems associatedwith (un)employment are shared by young people in both metropolitan and rural areas,
the latter face additional difﬁculties associated with geographical isolation and thenarrow range of employment and training options in rural/small town locations (Cartmel
and Furlong, 2000).
Problems relating to career development and occupational preparation of rural youth
also include reduced access and pursuit of post-secondary education, narrowed
school curricula, limited exposure to the world of work, and a lack of work-related rolemodels (Rojewski, 1999:142). Ultimately these problems can result in limited educationor employment-related problems such as lower personal income and higher rates of
unemployment and poverty, which may be exacerbated by a lack of economic vitality
and a relative scarcity of high-skill, high-wage employment options. Even though most
students planned to advance their education beyond high school rural and metropolitan
students differ in the subject areas they plan to pursue. Rural youth seem more likely tochoose locations they had been able to observe from experience (McCracken & Barcinas1991).
Aspirations emerge as a key difference between urban and rural youth. Quaglia andCobb suggests that student aspirations are, “the glue that holds the educational process
together”, arguing that aspirations go beyond students simply having goals and ambition(Quaglia & Cobb, 1996). Aspirations provide insight to what students think and feel
about themselves, their schools, and the roles they have within the school community.
They also provide an historical perspective on the construct of aspirations. Signiﬁcanteducational and psychosocial beneﬁts are associated with high levels of aspirations,and correspondingly, education and psychological problems are associated with low
aspirations (Plucker, 1996). McCracken and Barcinas (1991) came to similar conclusions
in their study of the relationship between school location (urban vs. rural) and students’occupational and educational aspirations.
The empirical literature comparing rural and non-rural student aspirations has concluded,
either that rural students have lower aspirations than their urban counter parts or that there
is relatively little difference. In both cases, researchers are well aware of the many factorsthat inﬂuence young people’s aspirations. These include: socio-economic status(Jones,

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68 Philip S. Morrison and Elizabeth Loeber

2002), parental occupation, attachment to place (Heckner, 1995), the schools they attend
and the communities they live in (McCraken & Barcinas, 1991) as well as family dynamics(Haller & Virkler, 1993) and ethnicity.
In summary, most of the education literature on youth transition ignores the locality as anindependent variable. The small literature that does recognise the importance of locational
context make a number of claims, speciﬁcally that non-metropolitan youth: a) have lower
aspirations on occupation and income; b) are more likely to leave school early; and c)
are more likely to end up in lower socio-economic, especially manual occupations. These
researchers also stress that any assessment of local labour market effects on aspirations
must take into account other market inﬂuences such as socio-economic status, parental
expectations, family dynamics and attachment to place.
So far, the New Zealand literature on youth transition has drawn largely on the education
literature in their analysis of three main longitudinal data sets: The CompetentChildren study by the New Zealand Council for Educational Research (Wylie, 2004),
the Dunedin Multidisciplinary Health and Development Study (Silver & Stanton, 1996)
and the Christchurch Health and Development Study (Fergusson & Woodward, 2000).1
Signiﬁcantly these longitudinal studies only follow cohorts of young people in metropolitan
areas and do not address the fact that rural/small town youth may have a different story
to tell. Nor do these studies access data on the local labour market.
Important though this longitudinal work is, there remains a consensus amongst thoseresearching various aspects of youth development that there is a lack of New Zealandbased literature (Higgins, 2002; Hill, 2003; Maloney, 2004; McLauren, 2002) as well
as a lack of good New Zealand data about many of the transitions that children andyoung people experience. The Transition Report Series Young People Not in Education,
Training or Employment – Key Indicators produced by the New Zealand Ministry of Social
Development (2003) highlights a number of issues and notes that further research isneeded in order to account for youth inactivity in key locations around New Zealand(our emphasis). This report is unique in that it actually acknowledges geographicaldifferences noting that rates of non-participation are signiﬁcantly higher than the national
average in some geographical locations especially those that experience disadvantage
as measured by the New Zealand deprivation index.
Running parallel to the education literature but largely unacknowledged by them is a
literature by economists, usually labour economists, who focus on the choice youth make.
Choice is usually framed as entering the labour market or continuing schooling. Using ahuman capital framework, binary as well as multiple choices by youth are modelled as afunction of family background, household structure, school type and academic ability as
well as the state of the labour market.2 However, large regional markets may confound avariety of inﬂuences, including preferences (e.g. strong traditions of valuing education),
school quality and labour demand (see for example Micklewright, 1989)

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Youth Transition and the Local Labour Market 69

Rice’s work based on the England and Wales Youth Cohort Studies show how local
conditions can play a very inﬂuential role in the decision to remain in fulltime education or
to seek employment. Rice notes how participation rates in further education for both males
and females are positively related to the unemployment rate in the local labour market,
the effects being greater at times of economic recession when unemployment rates arerising (Rice, 1999). Local conditions have been found to be particularly inﬂuential in thecase of young males with weaker academic qualiﬁcations.
In another example, Andrews and Bradley use a large cross sectional data base from
Lancashire in 1991 to underscore the importance of local labour market conditions in
the post secondary school decisions young people make (Andrews & Bradley, 1997).
Exceptions to this general conclusion are unusual but do appear in the work on schoolleavers across a number of Scottish cities (Garner et al., 1988).3
Our study departs from both these literatures in a number of ways. Firstly, our design
has been set up speciﬁcally to assess the impact of the local labour market on the youthtransition decision. Most of the studies we have cited use the local labour market asa control in order to measure human capital effects on choice. Our orientation is thereverse; as geographers we control for human capital and other inﬂuences in order tomeasure the impact of geography on decisions youth make.
Secondly, whereas virtually all the economic studies model the determinants of actual
choices made by secondary school studies we analyse the choices youth expect tomake. In this sense at least we come closer to the educationalists interest in aspirations
but from a geographic perspective.

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70 Philip S. Morrison and Elizabeth Loeber

Research Design and Methodology
Our study uses a questionnaire to obtain information on aspirations and intentions ofstudents in two secondary schools. The two colleges, Kawerau and Mana were chosen
to represent youth living in two very different locations.
Figure 1: Kawerau and Mana Colleges showing their catchment deprivation scores,
2001

While the locational contexts are deliberately quite different, we wanted to minimise
the differences between the two schools, so Mana College in Wellington was selected
because it too drew on a catchment with relatively high levels of ‘deprivation’ as measured
by the New Zealand Deprivation Index.4
Figure 1 shows the conﬁguration of the high deprivation areas within the catchments ofthe two schools. Mana, as a decile 2 school, draws on a slightly more heterogeneous
catchment and is ranked one step lower in order of priority for government funding thanKawerau which is a decile 1 school.5
The questionnaire developed for the study taps the student’s expectations about their
future post-school activities: when they plan to leave school, what they will be doing inthat ﬁrst year out, expectations about their highest level of education, the job they want,difﬁculties in getting that job, the local options, their movement expectations and theincome they expect from their ﬁrst full-time job (Loeber, 2004).

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Youth Transition and the Local Labour Market 71

In order to estimate what might reasonably be identiﬁed as local labour market effects
it was necessary to control for as many other mediating inﬂuences as practical. These
include differences in demographics of the sample such as gender, year of schooling(also a proxy for age of student), ethnicity, as well as the student’s level of academic
performance in school. As we work through the arguments we also consider the parents’
expectations, best friends’ aspirations and eldest siblings’ occupations and attachment
to the community.
Following a pilot study and focus group work the revised questionnaire was sent out tothe careers advisors at Kawerau and Mana Colleges. They explained the process toteachers who assisted in administering the questionnaire in April 2004 as part of a normal
lesson. A total of 338 responses were returned from students in years 10 through 13 fromthe two schools – an almost 100 percent response rate. Only those from years 11, 12
and 13 are used in this study because the relatively poor quality of responses from year
ten students.
Students in the two schools were asked what they ‘think they would be doing in the ﬁrst
year after leaving high school’. A variety of options emerged from this open ended question
including full time and part-time employment, studying, starting a family, travelling, joining
a gang, caring for a relative fulltime etc. The analysis in this article focuses solely on thedivision between employment and non-employment. There remains considerable scopefor examining other combinations including simultaneous work and study.
Controls
The expectation of employment upon leaving school did indeed differ signiﬁcantly acrossthe two schools: 77% in the case of Mana students and 66% for Kawerau College.
However, we cannot attribute such employment expectations simply to the characteristicsof the local labour market because of the presence of sample composition effects. For
example Kawerau College has many more girls in its senior years.
In order to control for these and other sample composition effects, we formulated a multiple
regression model. More speciﬁcally, after reducing the set of possible post-school options
to simply employment and non-employment, we have regressed this binary variable on
the local labour market variable together with a set of controls.6 Estimates of their effect
β were obtained by regressing the log of the ratio of the numbers who expect to be
employed to the rest who expect not to be employed (the log of the odds ratio or logit)
on the set of independent variables, X. Estimated probabilities can be recovered bysubstitution into p= 1/1-e-Xβ.7 In this study we simply report the odds ratios, eβ.
Our aim is primarily to estimate the inﬂuence which the location/school variable has inaccounting for student expectations, controlling for the inﬂuence of the following four
attributes: sex, ethnicity, year and grade.

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72 Philip S. Morrison and Elizabeth Loeber

The model we estimate is as follows:log (p/1+p) = α + β1 School + β2 Sex + β3,4,5 Ethnicity [1,2,3] + β6,7 Year [2,3] + β8,9,10Grade[1,2,3]
Where p is the fraction of students who expect to be employed when they leave school
andSchool = 1 if Kawerau, and hence 0 if Mana
Sex = 1 if male and hence 0 if female;Ethn1 = 1 if Maori, 0 otherwise
Ethn2 = 1 if Maori + Other, 0 otherwise
Ethn3 =1 if Paciﬁc Islander and Paciﬁc Islander + Other, 0 otherwise
Ethn4 = 1 if Pakeha + Other (e.g. Asian), 0 otherwise
Yrs1 = 1 if the student is in year 11, 0 otherwise
Yrs2 = 1 if the student is in year 12, 0 otherwise
Yrs3 =1 if the student is in year 13, 0 otherwise
Grade1 = 1 if the student identiﬁes themselves as an A grade student, 0 otherwise
Grade 2 = 1 if a B grade student, 0 otherwise
Grade3 = 1 if a C grade student, 0 otherwise, andGrade4 = 1 if a D grade, 0 otherwise.
This particular parameterisation implies that the constant α refers to the log odds of
opting for employment on leaving school by Maori girls in year 11 who rate themselves
as `D’ grade students. The values of the other parameters above indicate the degree of
departure from the log odds of this base group.

Results
The variation in expectation of employment upon leaving school is apparent from Table
1. Males and females are very similar in their expectations over the combined sample,

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Youth Transition and the Local Labour Market 73

Maori are more likely than non-Maori to anticipate employment, year 12’s were more
likely to do so and there tends to be an inverse relationship between self declared gradelevel and expecting employment.
Controlling for differences in the student mix across the schools actually increases thedifferential impact of the two labour markets on the odds of expecting employment.
The uncontrolled effect of schooling in Kawerau was to lower the odds that students
would expect employment by about half. When factors, such as the greater proportionof girls in Kawerau as well as the different distribution of students across the ethnic
categories, years and grades, are taken into account, the odds in favour of Kawerau
students obtaining employment fall even further relative to Mana, from 0.56 to 0.44. Most
importantly, however, the school, and by inference the local labour market, remains themost inﬂuential of our independent variables in accounting for post school employment
preference, Table 2.8 Table 2 shows the parameter estimates from applying the logit
model as odds ratios. Positive ratios relative to the base exceed unity. To the right ofthe point estimates appear the standard errors, the z statistic and associated probability
levels followed by the interval estimates.
Table 1. Variable means for students expecting employment

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74 Philip S. Morrison and Elizabeth Loeber

The odds ratios given in Table 2 are themselves of interest. Taking into account theother variables in the model, boys show no greater or lesser tendency than girls intheir expectations regarding employment and student’s own grade rating also has little
inﬂuence. Anticipating employment rises in year 12 but falls in year 13. The propensity
to expect employment decreases from Maori, to Maori and Other, through Paciﬁc Island
students to Pakeha students who show the lowest propensity. 9
Occupational and Educational Expectations
One of the striking features of student responses in both these decile 1 and 2 schools is the
optimism students express over their future employability. The full range of occupations
they suggested were categorised as high, medium and low according to the scalingof socio-economic status using the New Zealand Socio-Economic Index (NZSEI), an
occupationally-based measure of socio-economic status developed to replace the widelyused Elley-Irving scale (Galbraith et al., 2003).
Table 2: The impact of the local labour market on expectations of employment after
leaving school. Odds ratio estimates

The distribution of the NZEI-96 scores of these desired occupations take on a fairly
symmetrical distribution of scores in both schools. The socio-economic status of the ‘job
wants’ expressed by Kawerau students actually exceeded those at Mana college (46.3> 43.1).10 This result is contrary to what was anticipated given the town size, the stateof their respective labour markets and on the basis of the education literature. The two

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Youth Transition and the Local Labour Market 75

sample t-test with unequal variances yields t = -1.367 and a one-tailed test probability
that Kawerau > Mana of 0.087. This paradoxical result remained even when controllingfor sample characteristics.
The two sets of students were also asked what they thought their highest level of
educational achievement would be. Here we made the distinction between tertiary(Polytechnic and above) and non-tertiary (senior secondary, secondary school and tradecertiﬁcates) qualiﬁcations. The result is consistent with occupational differences: theKawerau students exhibited signiﬁcantly higher proportions wishing to go on to tertiary
study and again these results continued to hold after we introduce the controls. The odds
in favour of Kawerau students aspiring to a tertiary education are almost twice those of
Mana (1.80). Girls are substantially more likely to opt for tertiary qualiﬁcations (i.e. boys
are half as likely as girls) and again there is a close consistent relationship between
educational aspirations and self evaluated performance at school.11
Expected Earnings
Given that salaries tend to increase with specialisation and that opportunities for
specialisation increase with the size of the market, we expected students in metropolitan
areas to anticipate higher salaries than those in small towns and rural areas. Mana
students, for example, would be aware of the presence of Parliament, universities,
corporate headquarters, government departments etc. in Wellington. No such institutions
exist in Kawerau, although salaries at the Mill are uncommonly high for skilled workers.
Therefore, other things equal we anticipated that Kawerau youth would expect lower
incomes than Mana students.
We asked the students how much money they expected to take home per hour in theirﬁrst fulltime job. The ﬁrst thing we noticed was the high and unrealistic expectations
students had of their earning ability, especially in their ﬁrst job. It is not uncommon foryouth to over anticipate their employability and their likely salaries. Over 20% of Mana
and Kawerau students were expecting to earn more than $20 per hour in their ﬁrst job (thehighest category on the questionnaire). This rate equates to $41,600 per year after tax
which contrasts markedly with the median annual gross income of $13,602 in Kawerau,
over $14,000 in the Porirua areas and $18,545 for New Zealand as a whole (2001), notto mention much lower earnings youth would normally receive in the ﬁrst year of fulltime
employment.
The second point was the very wide range of earnings anticipated by students withineach school – from $8 to $20 per hour. There was no signiﬁcant difference in this respect
between boys and girls or between the two schools; nor was there any signiﬁcantdifference by age or ethnicity. All showed a wide dispersion in expectations with an
unusually high proportion with very high expectations.

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76 Philip S. Morrison and Elizabeth Loeber

The third point was that, despite the substantial difference in town size (and occupational
structure) there was an unexpected difference in the income expectations between
Kawerau and Mana students. The unusually high salaries drawn by Mill workers in
Kawerau may have distorted the pure market size effect, but we are inclined to discount
this argument because girls showed similar earnings expectations to boys.
Even with the demographic controls in place, a higher proportion of the Kawerau
College students expected higher incomes, indeed the chances of such a choice almost
doubles among Kawerau students (the odds ratio is 1.98 which is higher and statisticallysigniﬁcant compared to the uncontrolled ratio of 1.22). As expected `A’ grade students
were signiﬁcantly more likely to expect higher incomes. However, boys expect higher
incomes than girls, despite their lower educational expectations.
Unrealistic Expectations?
The important feature of these results on expected income, like those for qualiﬁcations
and occupation is that they are quite contrary to the educational literature which argues
that small towns and rural youth will have lower expectations or aspirations. They arealso quite contrary to the impressions we gleaned from ﬁeldwork in Kawerau. Therefore,
we pursued the notion that the local labour market context of Kawerau might actually
generate what we will call `hyper’ or `unrealistic’ expectations.
In order to test the presence of hyper-expectations, we introduced a number of‘reality checks’. The ﬁrst is the difference between ‘job wants’ and ‘job expects’ – what
McCracken and Barcinas (1991) refer to as ‘idealistic occupation’ as opposed to ‘realistic
occupation’ (p33). In order to differentiate between the two we took a second measure– the occupations students expected to be in by the age of 30 (see Haller & Virkler,
1993: 172). Secondly, we asked students to indicate what they believed their best friend
would be doing in their ﬁrst year out of school. Thirdly, we asked for the occupation of thestudent’s eldest brother and sister (where present). In each case we hypothesised that it
would be the Kawerau students who would exhibit more exaggerated expectations andlower degrees of ‘realism’.
Our ﬁrst measure of inﬂated expectations involved comparing the NZEI-96 rating of theoccupation the students wanted upon leaving school with that of the occupation they
expected when 30 years old. This comparison required a usable response to bothquestions and just over half of all students in both schools provided reliable responses,
with no detectable selection bias.
The result was a positive correlation between jobs wanted and job expectations at 30,
but with considerable variation (R2 = 0.64). The job students ‘wanted’ upon leaving school
corresponded only weakly to what they thought they would achieve at age 30. The mean
NZEI-96 scores were almost exactly the same however, and therefore there was is no

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Youth Transition and the Local Labour Market 77

downgrading (on average) between ‘wanted’ and ‘expected occupations’.
The slope coefﬁcients implied that students lower their long term job expectations thehigher the socio-economic rating of their initial ‘job want’. That is, for every 10 point
increase in NZEI-96 rating of occupations the Kawerau students ‘wanted’, there is only
a 5.4 point increase in the ratings of the occupation they actually ‘expected’ to get. The
Mana responses were similar at 5.8%. Even in their own terms, both sets of students
were being unrealistic in their immediate occupational expectations.
Turning to other activities upon leaving school, we found that less than one percent ofstudents in both schools saw themselves being unemployed or in a gang in their ﬁrst
year out of school, notwithstanding the much lower rate of employment among youth
in Kawerau. In marked contrast 12% of Kawerau students and 14% of Mana students
indicated that their best school friend would be unemployed in the ﬁrst year out of schooland eight percent in both schools indicated that their best school friend would be in a gang.
Both sets of students also saw a much lower proportion of their friends in employment;
21% fewer in the Mana case and 19% in the Kawerau case. In terms of our hypothesis,
therefore, Kawerau students did not exhibit a signiﬁcantly different ‘reality gap’ comparedto their counterparts in Mana College.
Our third reality check involved comparing the students’ own occupational expectations
with those of their eldest sibling. There is little variation between the schools in thenumber who have older siblings – about three quarters. The argument here is thatsiblings’ realised occupation would act as a guide to what is both possible and likely interms of occupational attainment. However, it is well documented elsewhere that children
ranked by birth order in a family show successively lower levels of attainment.
There is remarkably little agreement between the NZEI-96 rating of sibling’s occupationand those occupations the students expect when they are 30 years of age, although the
response rate to this question was low, under 30%. The older sibling’s present occupationaccounts for under one percent of the variance of the respondents expected occupation,with little difference between the schools. Once again we are unable to substantiate
the hypothesis that Kawerau students were more likely to exaggerate their occupational
expectations compared to the Mana students.
In summary, while the ‘reality checks’ have conﬁrmed a speculative element in
occupational expectations as well as post-school employment options in general, they
do not show that Kawerau students are any more ‘idealistic’ in their expectations thantheir metropolitan counterparts. In addition, neither the best friend comparison nor thecomparison between ‘job wants’ and ‘job expects’, nor comparisons with siblings wereable to demonstrate a lower degree of realism among Kawerau students.
We are still faced, therefore, with our paradox, namely that the higher occupation,

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78 Philip S. Morrison and Elizabeth Loeber

qualiﬁcation and income expectations of rural/small town students were no different totheir metropolitan counterparts even after controlling for student attributes. Subsequent
analysis of the presence of role models in the two communities did little to alter thisconclusion (see Loeber, 2004).
One more possible reason for Kawerau students’ higher expectations is their greater
willingness to move. Instead of seeing their future in terms of the local labour market,
these students may in fact scan a wider horizon than students already ensconced in amuch larger labour major market.
One of the major consequences of residing in a small town, especially towns with falling
job opportunities and relatively high unemployment, is that most students will have to
move elsewhere to get a job. The questionnaire responses bear this out with Kawerau
students realising that migration is a necessary step to the jobs they want whereas thiswas not a concern for Mana students. More Kawerau students (61%) indicated that they
could not do the job they wanted locally, compared with only (17%) of Mana students. A
larger proportion of all Kawerau students are, therefore, likely to have to migrate in orderto achieve their occupational goals.
When we asked whether they would move away from friends and family for a job agreater proportion of Mana students (28%) reported that they would not move comparedwith only 8% of Kawerau students. We must be prepared, however, for the possibility
that the proportion of students in Kawerau willing to move may, like their occupational
expectations, be unrealistic. The peer and family pressure to remain in a small town may
in fact be greater than in a large centre. As a bench mark we again used the student’s‘best friend’. The argument here is that students are more likely to be realistic in theirappraisal of their best friend’s true intentions and capacity to migrate than their own. We,
therefore, asked whether they thought their best friend would move out of the area to geta job if one was not available locally.
The results showed that Kawerau students were nearly twice as likely to say that
their best school friend would not move away from friends and family than they would
themselves,15%> 8%. By contrast there was little difference between Mana students andtheir best friend, 28% > 27%. In Kawerau, therefore, far from there being social pressure
to say in the town the students saw it as less acceptable not to be prepared to move awaylargely because the alternative implies inactivity and unemployment.
What this last result means in effect is that many of Kawerau’s senior secondary
students’ expectations are framed not by the speciﬁcs of the local labour market butby the opportunities perceived to lie beyond the town. For these students, realising
expectations implicitly involves leaving the town whereas in Mana our impression is that
expectations are based on the perceived opportunities in their local metropolitan labour
market.

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Youth Transition and the Local Labour Market 79

Discussion
We undertook this research in the context of a wider study on mobility and attachment inotherwise vulnerable communities (see acknowledgements). Our aim was to gauge therelative importance of the local labour market in secondary school students’ expectations
about their transition to work. Schooling in labour markets of very different size andcharacter would, we hypothesised, inﬂuence the students’ chances of securing a job andmodify their educational and occupational aspirations as well as the income they could
expect.
What our comparison of senior students in the two different locations has revealed isthat far from conﬁrming the generalisations made by educationalists about small versus
large towns, Kawerau College, a decile 1 school, has at least amongst its senior pupils
a noticeably smaller proportion expecting to go straight into employment. A signiﬁcant
proportion of senior students from this small town exhibit higher aspirations than ourcomparison school in a metropolitan centre. In this respect our ﬁndings do not match thegeneralisations in the literature about rural and small town youth.
Much that is paradoxical in this last result dissolves however, if we start, not with theeducation literature but with the labour economics literature. In each of the youthtransition studies we cited from the economics literature, the local unemployment rate
was found to strongly reduce the incentive for students to seek work. Most sensitive(and most elastic) in this respect are boys with lower levels of academic ability whose
propensity to leave is pro-cyclical.
The labour economics literature has shown how this positive relationship between thelocal unemployment rate and retention of seniors at school also holds in cross-section sothat locations with high unemployment experience relatively higher proportions of theirstudents staying on at school or going on to post-school education. It is this effect that
we believe we are witnessing in Kawerau together with its likely spill over into aspirations.
The prospects for those who leave school early in Kawerau are relatively bleak largely
because it reduces their opportunity for work outside the region. Parents, teachers andthe wider community know this and although teachers, parents and students do notnecessarily share the same values (Ley et al., 1996), the net result in Kawerau College
at least has been a concerted effort to retain students at school and equip them for
future education and where applicable provide post-school training knowing full well that
their opportunities for socio-economic advancement will involve searching a much wider
range of jobs beyond the town itself.
Useful though this last conclusion is in suggesting further research we are acutely awareof the limitations of this preliminary study. We have surveyed only two schools and wehave had to make the largely untested assumption that school and location effects are
inseparable. We know, however, that schools do differ, often considerably even within the

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80 Philip S. Morrison and Elizabeth Loeber

same local labour market. Any extension of this work, therefore, needs to include more
schools in more local labour markets so that school and market effects can be separated.
Such a separation would be necessary in order to identify the local impacts of decile 1
schools, for example.
A second urgently needed extension is to broaden the notion of choice beyond thedichotomy commonly used of ‘employment’ versus ‘study’. Our results, together with anumber of others in the literature, point to the wide range of possible post-school activitiesstudents can undertake – in including helping in the home and the caring for relatives– an ‘option’ canvassed by many poorer households from both locations. Elsewhere theapplication of multinomial models to choices made across three or more alternatives
have proved valuable (Andrews & Bradley, 1997).
More generally, Higgins (2002) has argued in her New Zealand work on youth transition
that how we conceptualise transition is crucially important in crafting effective youth
policy, and that such policy should recognise the additional complexities young people
face when they manage not only a transition from education to employment but also thedislocation of family and peer relationships which relocation can bring.

Conclusion
Through this geographically focussed research we learn three important things thathave far reaching consequences for the way we think about youth transition in general12.
Firstly, the nature of the local labour markets does inﬂuence the choices youth makeupon leaving school – but the paths linking place to youth expectations may be more
complex than have been framed to date.
Secondly, youth expectations are generated through many channels drawing on information
at several different scales: international, national as well as local. The messages gleaned
from these sources are not all consistent. The media may create expectations which
often have little factual basis in the local world. The expectations generated by the
media are further ﬁltered by teachers, parents, households and community role models.
How developed those mediating structures are may be important in preparing youth forsuccessful transition from school to eventual employment.
Thirdly, youth raised in small towns face an additional challenge in the transition to workor further study, namely the imperative to move and the likely separation from parents andthe community. The ability to remain attached and receive support through a transition
that is also geographical can further challenge youth in households and communities
whose support may have been weakened on other grounds such as the unemployment
and/or beneﬁt dependency.

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Youth Transition and the Local Labour Market 81

Acknowledgements
This work was undertaken as a component of the FRST funded research programme
Building Attachment in Communities Affected by Transience and Mobility led by Kay
Saville-Smith (CRESA) and involving cross-organisational research teams as follows –Phil Morrison (Victoria University of Wellington), Philippa Howden-Chapman and Rebecca
Osborne (Wellington School of Medicine), Cathy Wylie and Jane Gilbert (NZCER), Libby
Plumridge, Gina Priestly (Auckland University) Bev James, Margaret Southwick (Paciﬁc
Health, Education and Research, Whitireia) , Charlotte Williams, Mel Pipe (National
Institute of Child Health and Development, USA) and Eric Olssen.
We would especially like to acknowledge the help and support we received from Jocelyn
Anton, Life Skills Teacher and Careers Advisor, Mana College, and Linda Fowler, Career’s
advisor, Kawerau College who administered the questionnaires. The authors also wish
to thank Catherine Schroder for the GIS work.
An initial version of this article was presented under the title “Youth Transition and Place:
Expectations and the local labour market” to the 25th conference of the International
Working Party on Labour Market Segmentation “Intergenerational issues, the welfare
state and the labour market”, Brisbane, Australia, 22-24 July 2004. A subsequent version
was included in the proceedings of the 11th Conference on Labour, Employment andWork held in Wellington in 2004 (Morrison & Loeber, 2005)

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Footnotes
1 At least one labour economist has also used these data (Maani, 2000).
2 One of the more inﬂuential linkages made in this literature between local demand andyouth unemployment was the paper by Freeman and Rodgers (1999). Many of the
key issues were raised nearly two decades earlier (Freeman and Wise, 1982).
3 These examples of the approaches taken by economists form part of a wider body ofliterature on choice including the choice of education institutions. A recent example
with pointers to that literature is Wilson et al (2005). For an overview of the school towork transition literature in economics see Bradley and Nguyen (2004).
4 The deprivation index is constructed from 11 variables to produce a scale for small
areas which runs from 1 - the least deprived ten percent of areas, through to 10 - themost deprived ten percent (Crampton et al., 2000)
5 The reader should note that the deciles used for funding are quite separate conceptuallyand practically from the New Zealand deprivation scores used to map the catchments
in Figure 1.
6 We apply maximum likelihood regression using the ‘logit’ routine within Stata7; see
http://www.stata.com
7 The logistic regression model is widely used in youth transition studies (see forexample Andrews and Bradley, 1997; Lynch, 1987; Micklewright, 1989; Rice, 1999).
See Hosmer and Lemeshow for details (1989).
8 Note that our explicit assumption throughout is that it is the character of the local
labour market and not any particular uncontrolled differences in the schools(including teachers and careers advisors) which is the dominant inﬂuence. Although
our results are consistent with most other labour market based studies we do revisit
this assumption in our conclusion.
9 However, note that there are only four Paciﬁc Island students in the Kawerau sample
and that three of the four opt for employment, which is contrary to the dominant effectof the local labour market. We therefore give little weight to this particular difference.
10 Note all students responded to this question, 84 and 109 for Kawerau and Mana
respectively.
11 This result is consistent with recent ﬁndings in Australia where more girls thanboys intended leaving (small towns and rural areas) and going onto university,62%>39% (Alston and Kent, 2001). This result, they argued, reﬂected the gendered
opportunities in the rural employment sector.
12 Space limitations prevent us from including many of the tabulations andregressions from which we draw our conclusions but these are available on
request from the principal author; Philip.Morrison@vuw.ac.nz

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CHRONICLE
February 2005
The National Business Review predicted that employers in industries with high union
membership could expect more strikes and lockouts. This prediction was based on thelatest figure of 36 stoppages for 2004, which reversed the downward trend since 2001.
The Dominion Post also stated that the ‘battle lines had been drawn’ with the pay
campaign – ‘5 per cent in 2005’ - by the Engineering, Printing and Manufacturing Union
being the biggest concerted push for a substantial wage rise in years.
The Nelson Mail reported that employees at Cold Storage Nelson were striking for a 5
per cent pay increase as part of the Engineering, Printing and Manufacturing Union pay
campaign. However, a spokesperson for the strikers claimed that the strike was part of an
ongoing pay dispute that coincidentally fitted with the union’s national pay campaign.
The results of the latest Household Labour Force Survey (HLFS) for the December
Quarter received widespread coverage in the print media. The NZ Herald and The Press
reported that the unemployment rate had fallen to 3.6 per cent, the lowest amongdeveloped countries and the lowest in New Zealand since comparable records began.
The number of people in the workforce increased by 4.4 per cent during 2004 as the net
inflow of migrants dwindled and growth in the population slowed. The increase in jobs
had a positive effect amongst groups with high unemployment rates such as people over
55, the long-term unemployed, women and Maori. Most of the growth in the quarter wasin part-time jobs. However, The Independent cautioned that while the level of
unemployment was low, economic commentators were worried about the inflationary
effect of increased wages as skill shortages persist.
An article in The Independent suggested that the Government was indirectly subsidisingsome companies through its Working for Families welfare package. Companies were
benefiting from the package as the welfare payments to their workers allowed them tokeep paying low wages. Act’s Spokesperson Muriel Newman called it “corporate
welfare” in another guise and argued that these top-ups distorted the labour market.
The long running dispute at the Port of Lyttelton continued (see January 2005 Chronicle).
The Press reported that port workers began a month-long campaign aimed at disrupting
shipping after Lyttelton Port Company negotiators and union representatives failed tosettle a new collective agreement. A union representative stated that employees would‘work to roster’, meaning that there would be a ban on overtime and working on rostereddays off. The action fell short of a full-out strike called in 2004 but aimed at disrupting
the port and putting pressure on employers to improve their offer.
In another dispute, The Press reported that more than 1,000 Christchurch City Council
staff were set to strike after a breakdown in pay negotiations. Members of the Southern

Local Government Officers’ Union, which represents about 55 per cent of the council’s
staff, voted to strike for four hours if negotiations with the council were unsuccessful.
The Chief of Defence Forces was accused of intimidating a witness after he had sent a
letter to the witness. In the letter to a Defence Force chaplain, the Defence Forces Chief
expressed ‘concern’ about the chaplain’s decision to volunteer evidence, and saying hewould want to ‘discuss the matter further’. His actions were referred to the SolicitorGeneral as a possible contempt of court. The case concerned a Waiouru Army Museum
archivist who was claiming $210,000 in damages for unfair treatment by the army. Chief
Judge Goddard of the Employment Court ordered the letter to be withdrawn.
In a reversal of the normal outcome of cases before the Employment Relations Authority,
the National Business Review reported a decision where a worker in a Christchurch
convenience store was ordered to pay four weeks’ wages and costs after disappearing
from his job without trace. The Authority found the worker had abandoned his
employment.
The Independent reported on a test case before a full bench of the Employment Court
which ruled that employers and employees may keep their existing shifts and rosters
around public holidays. The 65-year-old ruling that a ‘day’ was from midnight tomidnight was redefined to be any period of 24 continuous hours agreed to by the parties.
The court underlined that any re-arranging of compensation for working on public
holidays could only be by collective or individual agreement. The decision was
welcomed by the Employers and Manufacturers Association (Northern) as being sensible,
practical and common sense.
In a further twist in the long running saga between Radio New Zealand and its former
news editor Lynn Snowden (see January 2005 Chronicle), the NZ Herald reported that
the Court of Appeal told both parties that it did not want its resources tied up in possible
tactical manoeuvring in their employment dispute. The court declined to give Ms
Snowdon leave to appeal against an Employment Court decision that Radio New Zealandcould ask her to turn up for a meeting with its lawyers.
The Taranaki Daily Times reported on the Employment Court ruling that staff at the New
Plymouth District Council would no longer be forced to wear badges showing their fullname (see September 2004 Chronicle). The Court ruled that the council was being
unreasonable in its insistence that staff wear such badges. This decision followed an
appeal to the Court after the Employment Relations Authority had earlier dismissed theclaims of staff objecting to wearing the badges.

March 2005
The ‘5 per cent in 2005’ pay campaign by the Engineering, Printing and Manufacturing
Union generated a raft of news reports (see February 2005 Chronicle). The Press
reported that simmering trade union resentment over low levels of pay rises during years

of healthy economic growth appeared to have come to a head. It noted that the message
from the union that it was not interested in any employer pay offers below 5 per cent, wasa clear indication of a strong push for pay rises and made industrial action more likely.
An article in the Dominion Post added that the Union had held a ballot where 95 per centof metal workers rejected a 3.2 per cent pay offer. NZ Herald reported that Auckland
metal industry workers planned to strike to show employers they were serious about calls
for a 5 per cent pay rise.
The Nelson Mail reported that 100 non-union nurses at Nelson Hospital either had tomake fortnightly payments of $12 or waive their rights to a 20 percent pay rise negotiatedby the Nurses Organisation. The move followed a nationwide postal ballot of nurses
conducted by the union to decide whether non-union members should pay for obtaining
the results of successful negotiations. The ballot meant that non-member registerednurses around the country will have a $12 bargaining fee deducted from their pay each
fortnight until the end of 2006 or remain on the old employment agreement.
The Association of University Staff (AUS) took legal action against the Vice-Chancellorof the University of Auckland, Stuart McCutcheon, after he failed to show up at a
meeting to negotiate a national multi-employer collective employment agreement. Mr
McCutcheon said he would only negotiate a collective agreement covering the Universityof Auckland, not a national multi-employer agreement. The AUS filed proceedings with
the Employment Relations Authority, alleging that the Vice-Chancellor had unlawfully
undermined bargaining.
The Press reported that more than 1,000 Christchurch City Council staff were threatening
strike action unless their union’s new pay proposal received a positive response (seeFebruary 2005 Chronicle). Council managers stated they were disappointed that theunion had rejected the Council’s $2.1 million offer and they estimated that it was theequivalent of a 4.5 per cent increase in the current total wage bill for the council workers.
The Press also reported that the Chief Executive of Canterbury Employers’ Chamber ofCommerce, Peter Townsend, had said that it was time the port company and the unions
resolved the long-running Lyttelton dispute. This was in reaction to news that union
members had voted to increase the pressure on the company (see January 2005
Chronicle).
There were several media report of collective negotiations. Christchurch bus drivers held
a stop-work meeting to back their call for better pay and conditions, according to The
Press. The Waikato Times reported that administrative and clerical staff at the Waikato
District Health Board were likely to take industrial action after mediation talks with theboard broke down. NZ Herald reported on work bans by Stagecoach drivers and plans tolaunch a six-day strike.
NZ Herald reported claims by ACT MP Muriel Newman that thousands of disabledworkers employed at the country’s sheltered workshops could lose their jobs under theGovernment’s Disabled Persons Employment Promotion (Repeal and Related Matters)

Bill (see December 2004 Chronicle). The Bill would require all sheltered workshops to
pay workers the minimum wage.
The Independent reported that there were a record number of jobs advertised in February,
fuelling concerns that a shortage of workers would fan wage inflation (see January
Chronicle). The number of job advertisements in newspapers and on the internet rose 7.3
per cent from January to February, according to the ANZ Banking Group survey. Whenthe same survey was featured in the Waikato Times it was noted that manufacturingindustry growth in the Waikato was well above the national average but the industry wasfacing growth constraints because of skills shortages.
The Supreme Court allowed the CTU and Business New Zealand to make submissions
when it heard Lord of the Rings model maker James Bryson’s employment dispute withhis former employer Three Foot Six (see November 2004 Chronicle). The case centred
on whether Mr Bryson (who was made redundant by Three Foot Six) was an employee oran independent contractor.
A nationwide survey published by the Public Service Association (PSA) showed that 31
per cent of prison staff were actively seeking other employment while 91 per cent wanted
to quit the Corrections Department. The PSA claimed that the Prison Service needed torecruit 1,800 new staff in the next three years to cover for attrition, to staff new prisons as
they are commissioned and to allow for additional beds within existing prisons.
Government plans to boost the labour supply by trying to attract expatriate New
Zealanders to return did not have much of chance to succeed, according to a NZ Herald
article. As the majority of expatriates live in Australia where incomes are much higher –around $170 a week after tax on average – it was unlikely that many expatriates would
return.
The Dominion Post reported the retirement of Chief Judge of the Employment Court,
Tom Goddard. Tributes flowed from many business and union leaders. Business New
Zealand’s Chief Executive, Phil O'Reilly, said that Chief Judge Goddard had been a‘good leader’ in a time of transition for the country’s employment court. National
Secretary of the Engineering, Printing and Manufacturing Union, Andrew Little, said thatwith the benefit of objectivity, Judge Goddard had “generally got the balance right”.
The Independent reported that Air New Zealand was appealing an Employment Court
ruling it claimed would allow pilots to double-dip on statutory holidays. According to
the Employment Court decision, the payments can be made in spite of a separate annual
leave entitlement agreement in the pilots’ collective agreement. The New Zealand
Airline Pilots Association (NZALPA) was seeking clarification of whether the airline’s
agreement with NZALPA should be subject to the Holidays Act 2003.

April 2005
The Employment Relations Flexible Working Hours Amendment Bill, which is promotedby the Green Party, would give employees the right to apply for flexible or part-timehours where they have fulltime care of children under five or disabled children up to andincluding 18. According to NZ Herald, Chief Executive of Business New Zealand, Phil
O'Reilly, said that his organisation was already working with the Government on
providing family-friendly workplaces and the Amendment Bill promoted unnecessary
compliance costs.
Industrial action by unions seeking wage increases featured prominently in the media
during April. In the Dominion Post, the President of the Council of Trade Unions, Ross
Wilson, provided a snapshot of recent actions when he stated that employers who resisted
fair claims for better wages and conditions could expect industrial action and the“…current action by university staff, bank workers, bus drivers, hospital workers,
furniture and manufacturing workers and metal workers is the result of out-of-touch
employers misjudging the determination of their own staff.”
Dominion Post reported that thousands of ANZ Bank staff had rejected an employer offer
which included a 3.75 per cent pay increase. About 3,700 ANZ Bank staff walked off thejob for two hours to attend stop work meetings.
The Press reported that Lyttelton port workers voted overwhelmingly in favour of athree-year deal with their employer, marking an end to industrial action (see March 2005
Chronicle).
The Dominion Post suggested that the ‘5 per cent in 2005’ pay campaign was gaining
momentum as thousands attend stop work meetings, picketed their workplaces andplanned strikes. More than 2,500 people gathered at a rally in Auckland organised by theEngineering, Printing and Manufacturing Union with a further rally planned for
Christchurch. Staff seeking wage rises picketed the Palmerston North Hospital and afurniture factory in Auckland. Interestingly, The Press reported that the Engineering,
Printing and Manufacturing Union would back down on its 5 per cent pay claim if an
employer could prove they could not afford it (see March 2005 Chronicle). The union
claimed that pressure had already been taken off two employers who had proved they
were not able to raise wages by 5 per cent.
The disruption for tens of thousands of Auckland bus passengers was avoided after awave of rolling strikes was called off to allow a return to pay talks. While unions
representing almost 1,000 drivers at the Stagecoach bus company were set to continue
action, the employer and union parties agreed to seek Employment Relations Authority
mediation.
The Press reported that The Christchurch City Council had pulled out of pay negotiations
with more than 1,000 staff (see March 2005 Chronicle). The Council threatened to takethe union to court for breaching good faith bargaining rules. Instead the Employment
Relations Authority ordered the two parties to begin mediation.
Nearly 90 per cent of Solid Energy’s employees walked off the job, crippling New
Zealand’s coal production. Unions said that employment relations at the state-owned
coal business were at their lowest ebb for more than a decade.
The Nelson Mail reported on the first case dealing with harmful work-related stress underthe 2003 Health and Safety in Employment Amendment Act. Nelson District Court
Judge David McKegg stated that “[t]here will always be stresses in a job, but they mustnot become health-threatening. Where employees have stressful work conditions andspecial medical difficulties advised to the employer, then immediate remedial action isrequired.” The company admitted liability and was fined $8,000.
Dominion Post reported that a Christchurch firm – Works Infrastructure - was ordered by
the Employment Relations Authority to pay more than $8,000 to an employee who wasforced to take a drug test. On hearing of an allegation that the worker and a colleague
had been smoking marijuana their manager told them they would have to take a drug test.
The two workers were not provided with details of the allegation or details of the drug
test, but were told it was positive. The Authority determined that the way Works
Infrastructure had dealt with the drug allegation and the way in which it had obtained theworker’s consent had disadvantaged him.
The study by the Employers and Manufacturers Association found that disaffected
employees stood a better chance of winning a personal grievance claim outside
Auckland. The study analysed decisions by the Employment Relations Authority during
2004. The Association claimed that dismissal laws introduced last year had made theprocess more complicated and employers perceived the selection of Authority members
for hearings as a lottery.
It was reported in the Dominion Post that the Supreme Court had reserved its decision onmodel maker James Bryson’s appeal against the Court of Appeal decision determiningthat he was a contractor (see March 2005 Chronicle). The five Supreme Court judges
were told that two of the Court of Appeal judges appeared to agree he was an employee
but were deflected by what was said to be standard industry practice and the wording of aone-size-fits-all ‘crew deal memo’ containing terms for the employment relationship.
The Employment Relations Authority ruled that Air New Zealand was entitled to dismissa captain after an investigation was launched when the firm discovered assault andaviation convictions against him (see November 2004 Chronicle). The Authority notedthat the Civil Aviation Authority’s review was not into the pilot’s fitness to be an
employee, and the airline was entitled to inquire into his conduct from a different
perspective. The airline said that cases of assaults in 1996 and 2001 were unrelated
wilful breaches of aviation regulations, casting doubt on his ability to make soundjudgments consistently when under pressure.

May 2005
In light of this year’s general election, the National Party started to set out its
employment relations policies. In NZ Herald, the party suggested that union militancy
had increased through the powers given to it in the Employment Relations Act and thiswould be curbed in a new law called the Employment Agreements Act. Among its
provisions, this Act would remove stress as a ground for employees to take action against
their employer under health and safety laws. Industrial relations Spokesperson, Wayne
Mapp, argued that it had become an “easy option in employment disputes for an
employee to claim work-related stress as the reason for non-performance’. The party
would also review statutory holiday pay and intended to introduce the option of a no-risk
90-day probation period for new employees.
There was extensive media coverage of the dispute between Auckland bus drivers andtheir employer Stagecoach. In May alone, there were 3 new twists to the dispute. First, it
entered a new phase when the unions decided to continue with the six-day strike, despitea recommendation from the Employment Relations Authority that they accept a company
pay offer. Authority member Alistair Dumbleton said the company was commerciallyand financially justified in rejecting the drivers’ demand for an immediate rise to $16 anhour, up from the current $13.94. Second, Stagecoach sought a binding ruling from the
Employment Relations Authority on how much its drivers should be paid. This was thefirst such application for a binding pay determination under The Employment Relations
Amendment Act 2004. But Stagecoach faced a high legal hurdle since it needed topersuade the Authority that the unions had committed a serious breach of good faith;otherwise, the Authority could not make a binding decision. Third, Stagecoachannounced that it would re-enter pay negotiations with the drivers’ unions when the sixday strike had finished.
In the dispute between the Association of University Staff (AUS) and the University of
Auckland (see April 2005 Chronicle), the Employment Court ruled that the University of
Auckland had to participate in negotiations for a national multi-employer collective
agreement. The Court said that the law did not allow the statutory process to be “shortcircuited ... as the university intends”. This was only a partial victory for the unions since
the court dismissed claims that the university had acted unlawfully and a complianceorder was necessary.
In the Christchurch City Council negotiations, staff withdrew a 24 hours strike over theirstalled pay talks (see April 2005 Chronicle). According to The Press, an e-mail ballot of
members resulted in more than half of the union’s 1,000 members voting against the
strike proceeding.
The negotiations at the ANZ and National Bank were still unresolved and the Dominion
Post reported that staff were taking another round of actions: staff would walk off the job
with little or no notice in rolling strikes at randomly selected branches throughout thecountry.

Academic staff at Waikato Institute of Technology threatened strike action following a
3.25 per cent pay offer. The Association of Staff in Tertiary Education (ASTE) said theWintec's offer of 3.25 per cent this year, followed by 3 per cent next year, was “notacceptable”. There were also difficult negotiations at five other North Island polytechnic
institutes.
Health sector staff also experienced difficult negotiations. The Press reported that 140
Christchurch rest-home workers were planning a three-hour strike in protest against low
pay rates. Union advocate Lynley Mulrine said members wanted an increase of between
2.8 and 5 per cent and the employer Qualcare had offered less than 1 per cent. According
to the Dominion Post, nine district health boards tried to prevent medical radiation
technologists from going on strike. The boards filed a request for an urgent hearing with
the Employment Relations Authority over contingency plans to prevent loss of life during
the dispute. However, the Association of Professional and Executive Employees (Apex)
decided to call off the strike as negotiations started again. As Apex was seeking
significant pay rises - $30,000 to $40,000 according to media reports – it was unclear
whether a settlement was in sight.
A further development in the long-running dispute between Radio New Zealand and its
former news chief arose when Ms Snowdon sought immediate reinstatement at the
Employment Relations Authority. She also took a personal grievance action against
Radio New Zealand which had dismissed her last month. This came after a two-year
standoff and with Radio New Zealand alleging the relationship had irretrievably broken
down (see March 2005 Chronicle).
In a case against Maori Television, the complainant was ordered to pay $3500 in costs
over her failed employment dispute (see January 2005 Chronicle). The complainant had
alleged that she had been discriminated against because she was not Maori. The
Employment Relations Authority determined that her claims of discrimination were“utterly without foundation” and that she had resigned of her own will.
The country’s top military officer Air Marshal Bruce Ferguson was reported as being
deeply sorry over a letter to witnesses in an Employment dispute (see April 2005
Chronicle). He escaped being prosecuted for contempt of court, despite a ruling of the
Solicitor-General that there was a case to answer. The court awarded the complainant$20,000 damages from the Defence Force for the intimidation, and that included apunitive sum for intimidation of a witness.
The Press reported that Inland Revenue was ordered to pay $5,350 to two staff members
it dismissed for improperly accessing their families’ tax files (see January 2005
Chronicle). The department was seeking leave to appeal against an Employment Court
order to reinstate the women, who were dismissed two years ago.
There were several media report of sub-standard working conditions and pay levels. NZ
Herald reported that workers in the Horticulture Industry in Northland were on bin rates
that earned only about $9 an hour. One worker claimed that “[i]t’s like slave labourbecause it’s $40 a mandarin bin and sometimes it can take you hours to fill that.” Despite
Northland’s chronic unemployment, Kerifresh has just hired 20 workers from Samoa for
their permanent workforce, mainly to prune and pick lemons throughout the year.
Many job-seeking skilled migrants experienced difficulty in getting their first job because
employers would often say that they have ‘no New Zealand experience’. However, awork experience scheme brokered by the Auckland Chamber of Commerce had recorded
many successes. So far, 1,500 new migrants have found jobs after going through theprogramme; 40 per cent with the company with which they did work experience.
Finally, a report released by Minister of Labour, Paul Swain, made serious allegations
about the treatment of foreign workers on foreign charter vessels. Foreign fishermen
were being underpaid, beaten and forced to work in sweatshop conditions, according to
the Nelson Mail.

Colin Ross and Erling Rasmussen
The University of Auckland