AI can help rewrite New Zealand’s productivity story – with the right prompts
By Madeline Newman, Executive Director, AI Forum New Zealand and Lewis Mills, Head of Corporate Affairs, Microsoft New Zealand
New Zealand’s challenges with national productivity have been well-documented – both through stories in the media, and conversations around the boardroom table.
Last year, an OECD report stated: “New Zealand’s productivity level remains markedly below the OECD frontier”.
While we used to be on par with similarly-sized Denmark, Finland and Sweden in 1970, the International Monetary Fund now shows our GDP per hour worked has fallen to 40 per cent below these peers.
AI offers us a clear way forward, with unprecedented opportunities to change the game. Research from Mandala identified AI applications and AI datacentres as our biggest opportunities to grow our economy. Another report from Accenture shows generative AI could contribute between $76 and $108 billion to our economy each year by 2038, by more than doubling our productivity.
So, if AI is the opportunity, how do we approach it? The AI Forum New Zealand recently co-hosted an event with Microsoft in Auckland that brought together business leaders from the tech industry and senior government officials to discuss how to support the Government’s growth strategy and enable more New Zealanders to reap the benefits of new technologies.
As Jo Hughes, Deputy Secretary of Economic Policy for the Treasury pointed out: “Most New Zealand firms innovate by adopting new technology – this is key for growth. However, despite some advances, technological diffusion in New Zealand is still low and slow. To lift our productivity through innovation, focus is needed on stronger relationships and networks between industry, government, and researchers, and with increasing capacity and capability.”
Microsoft supports a National AI Skilling Partnership, a public-private initiative uniting central and local governments, industry, educational institutions, and the broader community to equip workers with the skills to thrive in an AI-driven world.
In order to reach our potential, people need both technical AI capabilities and broader digital skills needed to adopt and adapt to new technologies. There should be particular emphasis on upskilling those in roles potentially most impacted by AI, creating opportunities for careers in AI augmented roles and, in the future, entirely new opportunities. On this journey, we need to ensure that there is fair and equitable access to AI technology and training resources, especially for under-represented communities.
Effective AI Skilling Partnerships benefit greatly from the private sector playing its part. Spark has been heavily engaged in skilling its own people and other businesses for AI, and fellow telco One New Zealand recently announced its own skilling programme, with a special focus on using AI responsibly. In West Auckland, Microsoft partnered with Te Pūkenga, Seen Ventures, Auckland Council and the Ministry of Social Development to support students and teachers, as well as adults and job seekers, to grow their digital skills for the benefit of the local creative sector, paving the way for more opportunities to work in their local communities.
The AI Forum New Zealand runs an annual nationalwide Hackathon Festival each August aimed at providing training and safe environments for everyone, from absolute beginners to advanced developers, to experience the power of AI to help solve environmental and societal problems.
We’re delighted to see AI and digital technologies be recognised in the new school curriculum too, so we can give the next generation of Kiwis the knowledge and confidence to thrive with AI. A national AI Skilling Partnership must also focus on adapting our tertiary education systems to become more agile and responsive to technological change, updating qualifications pathways to reflect industry needs in AI, data science, data centre trades and related fields as they emerge.
It is good to see most New Zealand universities and tertiary institutions are providing AI courses – both short courses and more advanced. Microsoft has been supporting this, with recent examples including working with Auckland University of Technology (AUT) to provide opportunities for recent graduates to upskill. A recent collaboration with academyEX on AI education initiatives to boost digital skills in New Zealand included a recent event for Palmerston North City Council.
In Australia, the New South Wales Government’s Institute of Applied Technology – Digital (IATD) and the associated Data Centre Academy are an excellent model, blending vocational and university learning in a flexible way in collaboration with industry. While AI-related courses have greatly expanded in tertiary institutions here, there’s an opportunity to work even more closely with industry in this way, to ensure the technology, training and industry needs evolve together.
Accelerating digitisation of the public sector must also be a key focus, to increase productivity, enhance services and reduce costs at the same time. A recent report found there are savings of $1.1 billion by 2030, and $3.6 billion by 2035, if the Government accelerated its current timeline for public cloud adoption by just five years. Moving to scalable public cloud, without the limitations and labour-intensive maintenance requirements of on-premises infrastructure, also opens up massive scope to leverage AI across our healthcare, education and justice systems and take advantage of local innovation.
AI diagnostics specialist Techion has already partnered with Awanui Labs and the University of Otago to enable medical samples to be assessed by AI on site at regional clinics, which immediately flags when samples need to be sent to experts for testing. This has the potential to significantly boost efficiency and extend regional services at Awanui Labs, which is responsible for around 70 per cent of the New Zealand diagnostic market, while enabling smaller regions to deliver the same level of service as major cities.
The more we can unleash innovative partnership and collaboration across the private and public sectors, the more we can seize the AI opportunity for business, for the public service, and for society. With the right focus on skills and enabling greater efficiencies and innovation across the public service, the faster New Zealand can grow, be more productive, and become the best small, advanced economy in the world.