Understanding the impact of the Australia-New Zealand travel bubble

With the continued threat from the ongoing Delta COVID-19 outbreak, particularly in New South Wales and wider Australia, the travel bubble between Australia and New Zealand has been suspended as of July 23, 2021. Announced first on 19 April 2021, the formation of a travel bubble between the island nations was a move welcomed warmly by many across the continent. It meant that many who had relatives or family across the Tasman sea would finally get to visit them, or reconnect with partners that they had not seen for over a year. The emotional impact of the travel bubble was immense, to say the least.

With the status of the bubble to be reviewed over the period of the next 8 weeks, it seems prudent to take a look at the various effects of the travel bubble, since it wasn’t just the emotional impact that it had on people that was noteworthy. Across both regions there were reactions that covered multiple positions on the spectrum of acceptance and rejection, and this has had a significant impact on which sectors of the economy do well, how hiring gets impacted overall, as well which policies are considered and implemented owing to the possibility that the bubble may burst.  

This article considers the tangible effects of the bubble through the lens of employment, reflecting on how well the economy is faring and how that impacts organizational policies and hiring.  

The Impact of the Bubble on the Economy

One of the most notable impacts of the bubble on the economic front was on the travel and tourism sector. While New Zealand contributed a whopping A$2.6Bn ($2Bn) to the Australian economy in 2019, Australia contributed about NZ$2.7Bn ($1.9Bn) to New Zealand’s economy, accounting for as much as 4 out of 10 of its international flights. With these data points, it becomes exceptionally clear that the travel bubble provides a much sought-after relief for the tourism sector in particular, which was one of the worst hit during the pandemic. In fact, within the first 10 days of the travel bubble coming into effect, New Zealand welcomed over 30,000 international travelers into their country.

It’s no surprise that the hospitality industry, which works closely and is impacted by industrial movements in tourism, also saw a boost as a result of the bubble. While the hospitality sector saw significant losses during the pandemic, the bubble provided some hope for recovery: New Zealands’ Scenic Hotel Group, which had earlier put one of its new West Coast hotels on hold, saw such an increase in the awaited hotel from inbound Australians that it reversed its decision just before the bubble went live. Brendan Taylor, managing director of the largest locally owned and operated hotel group in all of New Zealand, mentioned that the 300% spike in web traffic and subsequent increase in holiday spot bookings meant that the bubble had not only saved jobs but also had increased the region’s viability to the Australian market.

Organizational Responses to the Bubble and Changes in Hiring 

Elsewhere, the impact of the travel bubble has been less positive. This includes a response from New Zealand’s Auckland DHB “strongly discouraging” all travel across the Tasman, mentioning that it won’t approve business travel. This reaction was called “out of line” by Sarah Dalton, Executive Director of the Association of Salaried Medical Specialists (ASMS), but similar sentiments were echoed by large organizations in other sectors, albeit in a slightly nuanced manner.

Organizations like Vodafone, Spark, and Meridian Energy, all refrained from giving an unequivocal acceptance of the travel bubble, largely owing to the possible complications from the inherent risks of the bubble bursting. Meanwhile law firms such as Simpson Grierson and BuckettLaw laid out detailed guidelines for what organizations should expect in case of unexpected circumstances - including the possibility of paying their employees if they get stranded across the Tasman, as well as the possibility of enforcing a Force Majeure in such a case.

But other organizations, such as Commvault and Cognizant, have welcomed the bubble and praised its effects - particularly in terms of how it has impacted hiring as well as its impact on overall organizational culture. Christine Hartley, APAC senior manager at Commvault, appreciated the chance to enable great employee experiences for colleagues across the Tasman off-screen, while Nicola Young, head of people for ANZ at Cognizant, felt that the bubble was a great way to leverage “the cross-border talent opportunity”, particularly for vacancies in cybersecurity and tech development.

The Bubble May Resume in the Future 

This is not the first time that the bubble has been paused. For a period of 2 days in May, it had been paused due to an outbreak in Sydney and in June it had been paused for 3 days for a rise in cases in Australia. With this context, Jacinda Ardern mentioned, “We do want the bubble to resume ... but it must be safe," reinforcing her commitment to having the bubble in place once again. The suspension of the bubble will be reassessed in 8 weeks.

These ongoing changes continue to disrupt the economic ecosystem of the two countries.