As your company looks toward new global opportunities, it is worth considering the New Zealand market to hire professionals and grow your team. The Covid-19 pandemic has put global markets to the test. Among these markets, New Zealand stands out, receiving international praise for being one of the prosperous nations in the fight against the virus.
Where is the New Zealand market today?
New Zealand implemented one of the world’s strictest lockdowns on March 25, with only 102 official coronavirus cases.
According to market research firm Ibis World, New Zealand’s economy will achieve real GDP growth of 5.7 percent from 2021-2022, to reach $259.6 billion.
“New Zealand has outperformed most economically developed nations in its containment of the outbreak of COVID-19, enabling a faster economic recovery. A low cash rate, increasing government consumption expenditure, and a falling unemployment rate are expected to boost GDP growth in 2021-22.” Ibis World
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Doing business in New Zealand: What are the benefits for your company?
According to Invest in New Zealand, the country boasts an efficient, market-driven economy, “as it provides a variety of benefits, such as economic stability, comprehensive free-trade agreements, and an active government support for investment.” Here are the top benefits your company will enjoy:
- Economic Stability: After 10 years of restructuring its economy, it has now accelerated enough for international competitiveness.
- Competitive-Friendly: It is one of the world’s most competitive-friendly economies due to the privatization of utilities and state services, such as postage and rail services.
- Transparency: There is a high level of transparency in the business and government decision-making process. A free and independent media ensure this transparency. The 2019 Corruption Perception Index ranked New Zealand as the least corrupt country in the world.
- Free Trade Agreements (FTAs): Recent cooperation agreements with Singapore, Thailand, and China allow access to a more extensive consumer base.
- Infrastructure: News Zealand offers extensive transport and logistics connections. The country also boasts around 90 percent energy self-sufficiency and a highly-advanced telecommunication network.
- Competitive Business Cost: Globally, New Zealand ranks third in cross-border transactions with foreign partners — higher than the U.S., Australia, Ireland, and Germany. Prices for offices and construction are among the lowest of developed countries. There is also an ongoing effort to maintain a liberal international investment environment to reduce compliance costs.
Hiring in New Zealand: What should you expect?
An increasing number of New Zealand’s adult population is gaining a higher level of education. According to the OECD, 80 percent of 25 to 64-year-olds have an upper-secondary education or higher than the organization’s average of 83 percent. Among young adults (25 to 34-year-olds), the share rises to 87 percent, higher than the OECD average by two percent points.
New Zealand spends a comparatively large share of its national wealth on educational institutions. Simultaneously, at each level of education, a more significant share of funding comes from private sources than on average across the OECD.
Payroll tax in New Zealand
If you plan on hiring in New Zealand, the income tax rate may range from 10.5 percent to more than 30 percent. The Pay as You Earn (PAYE) system means employers do not have to worry about income taxes because they automatically get deducted from their employees’ incomes.
Employers must also consider a 28 percent corporate tax. While New Zealand doesn’t have a social security tax, there is a Goods and Services Tax (GST) of 15 percent on any goods and services sold while doing business in New Zealand.
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Want to Learn More About Hiring in New Zealand and the Asia-Pacific Region?
The Asia-Pacific region is one of the fastest-growing markets worldwide, offering a young, highly educated, and technologically adept population ready to tackle future global business challenges. We invite you to listen to our webinar “How to Successfully Build a Team and Expand in the Asia-Pacific Region” to learn more.