A ‘circle back in February’ mentality may be contributing to New Zealand’s stubbornly low productivity, writes Catherine McGregor in today’s extract from The Bulletin.
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The long, long summer break
Toss Grumley’s column in The Post arguing that New Zealand’s long summer shutdown may be hurting productivity has clearly touched a nerve. The investor and business adviser argued that the Christmas break “has started to become way too extreme”, accusing the country of mentally clocking off well before the festive season has even begun. The real problem, he said, is that “this mentality of ‘circle back in February’ seems to start late November or early December”, creating what he describes as an eight-week period in which people are “mentally tapped out”.
Grumley’s piece expanded on an earlier LinkedIn post in which he “copped some heat” from indignant commenters eager for their annual escape. Many insisted he simply didn’t understand the value of holidays, or that he should spend more time with his kids. They missed the point, he wrote. “This isn’t about taking time off, or relaxing for periods. I enjoy that too and it’s an important part of being a sharp business operator. This is instead about shutting down an economy for an extended period, then all wondering why as a country we feel poor.”
Talkback hosts agree it’s a problem – but still want the holiday
The column drew reactions from Newstalk ZB’s Heather du Plessis-Allan and Kerre Woodham, and the Sunday Star-Times’ editor Tracy Watkins, none of whom seem eager to shorten their own summer breaks. Du Plessis-Allan accepted Grumley “has got a point” that NZ has a habit of winding down early and drifting back late. But she also defended the long break as a vital joy of Kiwi life. Woodham, meanwhile, noted her own newsroom’s early departures, pointing to “our very own Mike Hosking who’s, even as I speak, roaring down the motorway in his fine European vehicle, heading off on his hols before December’s been here for a week”.
Watkins highlighted Grumley’s argument about productivity, comparing us to Europeans who invariably take August off yet tend to maintain higher GDP per hour worked. The difference, she said, is that “they can afford the downtime. We, effectively, are taking champagne holidays on a beer budget.”
The mental health missing link
Grumley also raised a point that has been largely overshadowed by the productivity debate: what it means for mental wellbeing to cram most of one’s annual leave into a single long stretch. If breaks are essential to wellbeing, as research consistently shows, then loading them into January could simply mean workers limp toward the end of the year with no respite.
This intersects with findings by mental health experts like Dougal Sutherland, who argued in The Conversation that better mental health is fundamentally linked to better productivity. He’s an advocate for the four-day work week, and said cutting hours without cutting pay can reduce burnout and actually lift productivity. As Otago University’s Paula O’Kane put it to RNZ’s Krystal Gibbens, “Traditionally, time spent working is used as a proxy for productivity, when in fact better rested and healthier people can be more productive in less time.”
Low productivity = low wages?
Another issue intersecting with New Zealand’s broader productivity challenges is our stubbornly low wages. Reporting by RNZ’s Susan Edmunds shows that even as the NZ minimum wage has risen sharply, it has not pulled other wages up with it. While it might make intuitive sense that higher minimum wages would help nudge the median wage up as well, that’s not actually the case. For overall incomes to rise, the country must generate more value per hour worked, said economist Gareth Kiernan. Until productivity issues are addressed, “the overall wage situation… is going to be one of relatively lower wages and stuck with compression down the bottom end.”
