Workers Depart Queenstown Quickly Due to High Living Costs

Workers flocking to Queenstown are leaving within weeks, citing high living costs as a primary reason, according to recruiters and unions. Despite record visitor spending and numerous job openings, a significant gap exists between average pay rates and everyday expenses in the area.

Struggling with the high cost of living, café worker Orla Marshall from Scotland shared her experience of returning to Queenstown. Living in a van was her only option after finding the expenses too steep last winter. Initially, she rented a room for $220 per week in Fernhill, which she described as below average but burdened by “very expensive” heating. Marshall noted, “A lot of our pay cheque was going towards that. And we did not necessarily find Queenstown to have higher wages, just higher prices.”

According to Hospitality NZ, hospitality positions in Queenstown paid an average of $28.51 per hour, only 2.4 percent more than the national average. Data from Infometrics revealed that the average worker in Queenstown earned $69,788, which is 12 percent below the New Zealand average.

Living expenses, particularly housing, have surged in the Queenstown Lakes District, now the most expensive in New Zealand. Rents have climbed at a rate not seen since 2000, consuming an average of 27.2 percent of a renter’s income. Marshall added, “Groceries, fuel and other expenses all seemed to carry a Queenstown premium.”

Challenges in the hospitality sector are exacerbated by stagnant wages despite rising prices. Simon Edmunds, regional organizer for Unite Union, highlighted the plight of workers facing inadequate wages, stating, “There are certainly some businesses that pay minimum wage in Queenstown – $23.50.” With room rentals costing between $300 and $400, he remarked, “You can do the equation – that does not work.” The average hospitality wage of $28.50 is insufficient when considering the high costs of food and petrol.

In 2023, many workers resorted to living in cars, tents, or hostels due to a rental shortage. Edmunds noted, “A lot of people end up leaving… they are just not saving money or even going backwards.” Many are now seeking opportunities elsewhere in New Zealand or even overseas.

Recruitment efforts are facing unprecedented challenges. Shauna O’Sullivan, area sales manager for recruitment agency Remarkable People, reported a significant demand for staff, stating, “It is just crazy busy down here. I have been with the company for four years now, and this is the busiest it has ever been.” The turnover rate is alarming, with many new hires leaving shortly after starting.

“People do seem to be coming through and then leaving quite promptly… we place people into long-term roles and then maybe a week or two later they come back and say, look, I cannot afford to live here,” O’Sullivan explained. Increasingly, workers are looking towards Australia for better-paying opportunities.

Edmunds expressed skepticism about any substantial changes in employer practices. He characterized Queenstown as a “high churn” economy, where tourism employers frequently hire but offer low wages. “There are good employers who have long-term staff, but they are a bit far and few between,” he said. He emphasized that Queenstown should not only cater to the ultra-wealthy but must also provide a livable environment for those who sustain its economy.

“Queenstown can be a place that can have ultra-high-end tourism… but what is to stop it from being a place where the people – who actually run it, who keep the shops open… actually get some of those rewards as well?” he asked, addressing the urgent need for a more balanced approach to wages and living conditions in the region.