A few weeks ago I was talking with someone in their mid-twenties. Sharp, good at their job, the kind of person any business would want to hold onto. They'd just made the call to move to Australia. Not for a working holiday. For good. And I keep hearing versions of the same conversation.
We tell ourselves this is just the OE. It isn't, not anymore. The OE my generation took was a couple of years in London (or ten, in my case), but the intention was always to come home. What's happening now is different. In 2025 New Zealand lost a net 40,000 of its own citizens, off more than 66,000 departures, and 61 percent of them crossed to Australia. People aged 18 to 30 made up nearly four in ten of those leaving. Through 2014 to 2019 the net loss to Australia averaged about 3,000 a year. It's now running close to 29,000. The numbers have stopped looking like a cycle and started looking like a drain.
Ask why and you get the same answer every time. Better pay, better opportunities. The average full-time salary in Australia now sits around NZ$102,000. Here it's about $76,000. When the gap is that wide and the flight is that short, you don't need to be cynical to understand the decision. You just need a mortgage.
So the real question is not why people leave. It's why we can't pay them enough to stay.
We grow by adding people, not by getting more from each one
We talk about this one constantly and so far haven't been able to do anything about it. New Zealand has a productivity problem that is decades deep. In 1950 our income per person ranked second in the OECD. We're now around twentieth. Most of the growth we have managed has come from adding workers and hours, not from getting more output from each person. On output per hour we sit roughly 40 percent behind the top half of the OECD, and that gap has been widening, not closing.
Wages can't rise faster than productivity for long. That's not an opinion, it's simple maths. If we want businesses that pay enough to keep our young people here, we have to build businesses that produce more per person. There is no other lever.
The national problem is the firm problem at scale
Here's what I see on the ground, and it's the same story told small.
Great New Zealand businesses hit walls at predictable points. Around 8 to 10 staff. Again around 20 to 30. Again around 50 to 70. At each of these points the thing that got the business this far stops working. The owner who held every detail in their head can't hold it anymore. The informal "everyone just knows how we do it" stops being true once there are too many people to just know.
The default response is to add overhead. More admin. More managers. More headcount to manage the headcount. Output goes up, but output per person doesn't, and the margin that should have funded better wages gets eaten by the cost of holding it all together.
That is the national productivity problem playing out one business at a time. We are a country that grows by adding people instead of getting more from each one, because our businesses do exactly the same thing when they hit a ceiling.
The good news is that the ceiling is not fixed. It comes from how the business is put together: how work flows, where knowledge sits, how much still runs through one person. Those are all things you can change. Move them, and you move the ceiling.
What this looks like in practice
I'll keep these anonymous, but they're real, and they're New Zealand.
A small installation business, fewer than ten people, built on a simple promise to its customers: handle the whole job, end to end. The founder kept that promise by holding the business in his head. Every enquiry, quote and job ran through him, across a set of tools that didn't talk to each other, so he became the human glue holding it together. About one enquiry in ten turned into work, not because the work was poor but because the front door leaked. He didn't want to hire an administrator to paper over it. So we mapped the whole operation and started rebuilding it on connected systems, so the business no longer has to live in one person's head.
A meat processor that had grown fast, to the point where it ran on the habits and tools of a much smaller business than it had become. Production plans shifted through the day, critical knowledge sat in a few people's heads, and a stretched leadership team held it together by effort. It had the scale of a large business without the practices of one. We mapped how work actually flowed, then built a simple operating system to run the day: end-of-shift forms feeding a live dashboard, and a daily job that used to take a couple of hours now done in a click. The leadership team runs the business instead of carrying it.
A national franchise with a small head office supporting around sixteen regional teams. Between them they generated hundreds of leads a month, but no one could see what happened to those leads. Sales, finance and marketing numbers were pulled together by hand from systems that didn't connect, arriving weeks late and often wrong. The business had plenty of data and almost no visibility, so leadership was steering the whole network half blind. We're building a single live view that brings the picture together, across every region, for the first time. The data was always there. Now they can actually see it.
Different sectors, different sizes, same pattern. In each case the answer wasn't to work harder or hire more. It was to lift what each person could produce.
This used to be enterprise-only. It isn't anymore.
For a long time, the advice and the tools that lift output per person were priced for large companies. A custom system built around your exact process, sitting on top of proper strategic advice, was a corporate luxury. A 25-person business in the regions was never the customer.
That has changed, and it has changed quickly. The tools can now be built around a single small business's real process, not a generic template. And the consulting itself can be delivered far leaner, because at N16 we use AI in how we work, not just in what we recommend. That's the whole idea behind how we're built. We don't only advise where AI can help. We use AI to make premium consulting affordable for New Zealand businesses that were never previously able to afford it.
It means a gin distillery, an engineering workshop, a law firm, a solar installer, a food producer, a regional franchise, can each get advice and tooling built around how they actually work, at a price that makes sense for their size.
What's actually at stake
Now think again about the person who left for Australia. This is the part that decides whether the next one does.
We will not keep our next generation with sentiment, or with clever campaigns about how good life is here. We'll keep them by building businesses productive enough to pay them properly, and worth turning up to. Those two things come from the same place. A business that lifts output per person can afford better wages and tends to be a better place to work, because the people in it are doing work that matters rather than holding the whole thing together with effort.
N16 doesn't have a grand mission to fix the country. But we can make a real difference, one business at a time. And that's exactly how the national number moves, because the national number is just every business added up.
We can keep watching the good ones leave. Or we can build businesses people don't want to leave.
