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Kiwis squeezed by commute costs

Kiwis squeezed by commute costs

Many Kiwis are spending large chunks of their pay packet getting to and from work, according to a new survey by office provider Regus.

The global survey found New Zealand workers spend an average of 4 per cent of their take-home pay on commuting, higher than Australia’s 3.5 per cent but lower than the global average of 5 per cent.

However, one in fourteen Kiwi workers (7.2 per cent) spend more than 10 per cent of their annual take-home pay on commuting, while a further one in five (21.6 per cent) spend between 5 per cent and 10 per cent.

At the other end of the scale, nearly one in three workers (30.9 per cent) spend less than 1 per cent of their pay getting to and from work.

Paul Migliorini, CEO of Regus Australia and New Zealand, says spending more than 5 per cent of after-tax income on commuting puts a significant strain on household finances, particularly for low-to-middle income earners.

He says the cost of housing is contributing to long and expensive commutes in New Zealand’s main cities, particularly in Auckland where house prices are more than eight times household incomes*.

“Some people choose to live far away from work for lifestyle reasons, but many Auckland workers are locating in outer suburbs because they simply can’t afford to buy or rent closer to the central city where many jobs are located,” Migliorini says.

“Unfortunately, much of the money they save in housing costs is swallowed up by increased spending on transport. There is also the time cost: a recent TomTom study found New Zealanders spend an average 88 hours a year commuting, and 95 in Auckland.”

The Auckland Council is currently consulting on transport improvements as part of its Long-Term Plan, but Migliorini says employers need to also play their part in making commuting easier for workers.

“Flexible working options are becoming more popular, but workers need to be aware that working from home carries its own costs and drawbacks,” he says.

“One option is for businesses to locate in the suburbs closer to where the workers are. For these businesses, a virtual office can ensure they still have a presence in the central city.”

The Regus survey attracted more than 44,000 respondents globally, including more than 100 in New Zealand.

*Source: Demographia Housing Affordability Survey 2015


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