Wellington Region
Wellington shows capital-city vulnerability: 5,961 public sector jobs lost in 2025, with Weta layoffs compounding film sector uncertainty despite $577M rebates.
Wellington demonstrates the vulnerability inherent in capital city economies dependent on government employment. The region lost 5,961 jobs in 2025 from public sector restructuring—a contraction that rippled through service industries built to support bureaucratic workforces. GDP fell 0.9% in Q2 2025, twice economists' predictions. This pattern validates what ecologists call trophic cascade: when the apex employer reduces, every dependent sector contracts in sequence.
The region has attempted to diversify through creative industries since the 1990s. Peter Jackson's Weta empire made Wellington a "UNESCO City of Film," currently hosting Avatar series production and anchoring companies like Weta Workshop, Weta FX, and Park Road Post-Production. Yet even this sector proved vulnerable: 100 roles faced cuts at Wētā FX in August 2025, described as a "major blow to Wellington's creative sector." The government allocated $577 million in additional screen production rebates, but the American market representing one-third of New Zealand's $3.5 billion film economy faces potential disruption from proposed US tariff policies.
Wellington's tech startups (Sharesies, LanzaTech, Ethique) represent a third evolutionary attempt—service innovation rather than government or film. The metropolitan population of 433,900 provides the density for startup ecosystems, while Trade Me and AoFrio demonstrate successful scaling. Yet the capital remains structurally tied to government cycles. When Parliament expands, Wellington prospers; when it contracts, the creative and tech sectors cannot fully compensate. The city exists in perpetual tension between diversification aspirations and capital-city path dependence.