When Roger moved states he had to take a $50k pay cut for the same job. It took a decade to earn it back

In the early 90s, Roger Hosie “dragged” his wife away from Tasmania on a promise they’d be back in a decade.

But when the time came, the insurance broker — who’d been excelling in his career in Melbourne — had to take a $50,000 pay cut for a similar job in the island state.

On just one income, the pay drop was considerable for his family of four. 

“We weren’t poor by any means, but we were on one wage and went from being really comfortable, and doing pretty much as we wished, to having to count the pennies again,” Mr Hosie said.

From then on, it got worse before it got better.

Mr Hosie decided to branch out on his own and had one “really good client” lined up.

“They went bankrupt about four weeks into me pulling the pin and going out on my own,” he said.

“I went from an $80,000 wage to nothing. That was scary.

“I had to be really, really frugal. We didn’t have a lot behind us. We still had a mortgage.

Mr Hosie estimates it took him about 12 years in Tasmania to reach the wage he was on when he left Melbourne.

He has no regrets about the time lost because it came with an opportunity to start his own business.

But while Mr Hosie was climbing his way to success, the island state was too — and it’s costing its residents.

$40,000 pay cut for Sydney couple

Anne O’Loughlin and Matt Howard recently made the move from Western Sydney to Tasmania.

“One day I found myself saying, ‘let’s treat ourselves to driving on the toll roads, so we get to work quicker’,” Mr Howard said of Sydney living.

The couple found their “forever home” in Hobart instead, but have had to sacrifice part of their income in the process.

Ms O’Loughlin works in the vet industry and Mr Howard is a public servant working for a government department.

They’ve stayed in their respective careers, but the annual household earnings are now $40,000 less. 

“Something we looked at very carefully was what we could absorb in terms of a difference in income,” Ms O’Loughlin said.

At the same time, Tasmania hasn’t lived up to their expectation of being cheap. Quite the opposite — the cost of living “seems comparable to Sydney”.

“Initially, we rented a place and that was certainly more than we expected to pay,” Ms O’Loughlin said.

Here’s what people in your state make … and spend

If the Tasmanian wages seemed low to the Sydney couple, and cost of living higher than expected, it’s because they are.

Here’s what people in your state make on average, and what they spend on essentials like power, fuel, rent and property.

Canberrans take home the highest weekly wages ($1,890), and Tasmanians the lowest ($1,488). What’s more, the Tasmanian weekly wage is about $200 lower than the national average.

In just one year, house prices in Tasmania have grown by 20 per cent — the biggest spike across all states.

Victoria has recorded the lowest increase at 8.7 per cent, followed closely by Western Australia at 8.8 per cent.

It’s now more expensive to rent in Hobart than in Melbourne.

In the past decade, Hobart’s recorded the highest increase in rental rates for houses, at more than 47 per cent — followed by Adelaide with 25 per cent.

Canberrans pay the most to turn on the lights, with their average electricity bills $1,967 a year. They’re followed closely by Tasmanians, who fork out $1,945.

Those living in New South Wales are likely to have the lowest power bills, at $1,292.

And when it comes to fuelling up the car, Northern Territorians are paying top dollar for petrol, followed by Queenslanders and Tasmanians.

However, Queensland’s diesel prices are the lowest in the country.

So why the difference?

Much of the wage disparity comes from the composition of each state’s economy.

Victoria and New South Wales enjoy a larger presence of the financial, IT and communication sectors, whereas Tasmania is more of an “industrial” state, says Professor Joaquin Vespignani.

“Tasmania has a large presence of low-paid industries such as retail, manufacturing and tourism,” the Australian National University researcher said.

People working in those industries are more likely to hold casual or part-time jobs.

In fact, they may want to work more, but are not given the hours — in other words, they’re underemployed.

While Tasmania’s unemployment rate of 4.5 per cent is relatively low, the state’s on third spot in terms of underemployment, at 8.2 per cent.

Dr Mala Raghavan, from the University of Tasmania, believes in reality the underemployment figures are likely to be even higher — because even if a person works just one hour a week, they’re considered employed.

“If the workforce is not working enough hours … that’s not adding much value to the overall output to the state as well.”

That’s not to say there are no jobs in Tasmania. Many sectors, like health and education, struggle with dire worker shortages — but according to Dr Raghavan there’s a “mismatch of skills”.

“You have the workforce, unemployed group, but they’re not able to take up that position,” she said.

But Professor Vespignani believes the pandemic has presented Tasmania with a real chance to turn things around.

“I believe there’s the opportunity to attract high-paid individuals to Tasmania, working from Tasmania to the main cities,” he said.

“What will also make a difference is to create an incentive for large corporations to move the headquarters here.”