...if they want. It has been argued by certain politicians (who really should know better) that banks should 'do their bit' for jobs and stop firing New Zealand workers to hire overseas workers. There are two reasons why they should be able to offshore.1) It makes the majority of New Zealanders better off. New Zealand banks are in a relatively competitive market - and any lack of competition is often made up for by the massive political and media focus they endure on every level of their pricing structure, and thus the hugely negative responses they get if they raise prices. Banks save money by sending jobs offshore - that's why they do it. Reducing their costs enables them to reduce prices for their various products, meaning New Zealanders have more money in their pockets.
Yes, jobs are lost, and it this can be very difficult for people. Firstly though, because prices have gone down, people will be spending more money in other sectors, creating jobs in those sectors. So the net job loss to New Zealand is less than the total number of local jobs cut by banks.
2) It makes foreign countries better off. Most of the offshoring creates jobs for very poor foreigners(*). Yes, they are low-paid jobs. But low-paid is better than no-paid. There is no evidence to suggest that people are coerced into working call centres or there is some sort of cognitive bias in play - so we can infer from the fact that these call centres (and the like) actually have staff that they are making people better off. If they weren't, no-one would choose to work there! Furthermore, these people spend the money they earn in their local communites, creating further jobs.
The second point I think is really important. It is often said that we should be 'looking out for Kiwis', or 'protecting Kiwi jobs', but the flip side is that by doing this we are taking bread out of the mouths of desolate foreigners. If you are worried about New Zealand reducing or restructuring foreign aid, you really have no grounds to oppose banks offshoring jobs. The two things are really morally identical, and it frustrates me that they garner support (and opposition) from such divergent political interests.
None of this analysis is particularly complex or heterodox. In this circumstance, it is highly irresponsible of politicans (and unions) to try to pretend they are doing anything else than protecting the interests of a very small group of people at the expense of the majority.
I have more to say on the bank guarantee and bank lending rates, and this will be coming in the next few days.
* Kiwibank being the exception - for some reason they offshored to a higher wage economy! Perhaps this country is already ahead of us and has offshored their workers, creating high local supply and thus lower prices than here? I'm otherwise a bit unsure as to why they might do this.