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COVID's impact on NZ's tech community

Trent Mankelow, Guest Post. 01 July 2020, 8:08 am
COVID's impact on NZ's tech community

One way that economists measure economic activity in New Zealand is to count the number of cranes in our seven biggest cities. It's imaginatively called the Crane Index®

Since the start of the pandemic, at Summer of Tech we've been asking potential employers whether they will be hiring interns in 2020. It's our version of climbing the Sky Tower with a pair of binoculars, and, like the Crane Index, I'd like to humbly suggest that our Intern Index® is an excellent good one way of measuring economic activity amongst tech employers during COVID-19.

After hearing back from 228 organisations so far, it's a mixed bag. Nearly one third (32%) are saying 'yes' they will hire interns in 2020, 48% are saying 'no', they won't, and 20% are still unsure.

However, the problem with these data is that we are querying organisations of all kinds, including some that have never hired interns or haven't hired them in years. In other words, that they aren't hiring interns in 2020 has nothing to do with the pandemic.

So, if we limit responses to only those that hired Summer of Tech interns last year, then the picture looks a bit rosier, with the yeses jumping to 55%, the noes dropping to 20%, and the I-dunnoes increasing to 25%.

Of course, these numbers are overly simplistic because, as we know, COVID's impact on tech employers is unevenly distributed. For example, some services firms are working 16-hour days to keep up with demand, and others are laying off staff. Companies that are reliant on tourism, retail, events, hospitality, etc are generally hurting, but we know also some that are doing really well.

However, if we look at the size of organisation then the patterns are clearer. For example, larger corporates and, disappointingly, public sector agencies, are acting in a risk-averse way and are slowing their decision making right down. This has the flow-on effect of hurting some of the smaller agencies/consultancies who rely on projects from these bigger organisations. And it hurts students too - we've had a flat 'no interns' from a number of the bigger public sector agencies. I know times are challenging, but I think this is short-sighted.

Smaller companies seem more optimistic. For example, 24 organisations took advantage of our recent offer to prepay for their internship placement fee, and 19 of those have fewer than 50 employees. All up, 35 interns were pre-paid, more than double last year. Maybe smaller companies are more agile, or are more WFH-ready, or simply more willing to take risks. (BTW, Callaghan Innovation's recent survey is worth a look - their clients also seem reasonably optimistic).

Given the mixed bag, it seems appropriate that I'd summarise with a mixed metaphor - I'd say that the canary in the coal mine is still singing, but the fat lady is yet to find her voice. 

Trent Mankelow is the CEO at Summer of Tech, a regular reader of pleated-jeans.com and is currently attempting to learn about interior design (a subject he knows nothing about).


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