Australia and New Zealand Sees New Backpacker Tourism in Facing Skyrocketing Exploitation, Cheating, and the Explosive Downfall of Budget Travel

Backpacker tourism is a significant economic contributor to both Australia and New Zealand, particularly through the working holiday maker (WHM) visa programs that allow young travelers to work while exploring. However, this sector is fraught with ethical dilemmas, including the exploitation of workers in regional labor markets, such as fruit picking, where backpackers often face low wages, poor accommodation, and unsafe working conditions. These labor conditions arise due to their visa dependency on employers, creating power imbalances. In addition, unsustainable agricultural practices and environmental degradation have been linked to the growing number of backpackers, particularly in remote areas. While both countries are introducing reforms, such as the increase in tourist levies in New Zealand and visa program revisions in Australia, they face challenges in ensuring fair treatment, sustainable practices, and positive community impacts. The future of backpacker tourism depends on finding a balance between its economic benefits and ethical responsibilities, ensuring safe, fair labor practices while promoting responsible tourism.

The Economic Significance of Backpacker Tourism

In both Australia and New Zealand, the tourism industry is crucial to their economies. In Australia, international visitors spent A$55.4 billion in 2024, a 16% increase compared to the previous year. Of this, backpackers represent a notable portion, particularly those coming on working holiday maker (WHM) visas. These visas allow young travelers to work while they explore, often in regional sectors like agriculture, helping to fill labor shortages in rural areas. By June 2024, there were over 170,000 WHM visa holders in Australia, contributing to both the tourism and agriculture sectors.

Similarly, New Zealand has experienced a recovery in international tourism, with over 230,000 visitors arriving in August 2025 alone. While the country’s overall tourism recovery continues, it still lags behind pre-pandemic levels. Backpacker tourism remains integral to New Zealand’s regional labor markets, particularly in industries such as fruit picking and other farm work.

However, the economic contributions of backpacker tourism come with ethical implications that raise significant concerns about labor exploitation, environmental sustainability, and the quality of life for local communities.

Ethical Dilemmas: Exploitation and Precarious Labor

One of the primary ethical concerns surrounding backpacker tourism is the potential for exploitation. Working holiday makers are often placed in vulnerable positions, where their visa status ties them directly to their employer. This dependency creates a power imbalance, leaving them open to poor working conditions, unsafe accommodation, and low wages. Many backpackers are employed in seasonal, labor-intensive jobs, such as fruit picking in remote, rural areas. In exchange for labor, they may receive substandard accommodation and be subject to long working hours for little pay, with the added fear of not meeting visa requirements to extend their stay.

Research from the Immigration Advice & Rights Centre (IARC) revealed that some workers on WHM visas experience some of the most severe forms of exploitation. Reports document cases where employers withheld wages, forced long hours, and provided inadequate living conditions. These findings highlight the blurred lines between tourism and cheap labor exploitation, turning what should be a cultural exchange into an environment of migrant worker abuse.

In Australia, the Regional Labor Program—which mandates working holiday makers to complete a certain number of months in regional agriculture to extend their visas—has led to worker vulnerability. While it was designed to help fill labor shortages in farming and agriculture, it has also contributed to the systematic exploitation of backpackers, with little regulation around housing, wages, and working conditions in regional areas.

Unsustainable Agricultural Practices and Low-Budget Travel

The ethical dilemma extends beyond the exploitation of young travelers to environmental concerns. Many backpackers take on farm work in exchange for a second-year WHM visa. These agricultural practices often involve unsustainable farming methods, contributing to soil degradation and excessive pesticide use. Furthermore, backpackers are frequently housed in overcrowded, poorly maintained accommodation, creating further strain on local resources.

In New Zealand, the backpacker workforce is also heavily utilized in seasonal labor. However, as the government seeks to encourage sustainable tourism, it faces challenges in managing the negative environmental impacts of budget travel. Low-cost accommodations and high-volume travel create significant pressures on infrastructure, especially in rural areas. The influx of young travelers in these regions leads to overcrowding and strains on local utilities.

Impact on Local Communities

The growing number of backpackers arriving in both Australia and New Zealand also has an undeniable impact on local communities. In rural regions, where backpackers often work in agriculture and hospitality, the demand for affordable housing has surged, putting pressure on the limited availability of properties. In some areas, locals face higher rent costs as the market adjusts to cater to transient workers, displacing residents who cannot compete with the demand from tourists.

Moreover, in regions like South Australia, where backpackers are a critical source of labor for farming, the backpacker numbers have dwindled in recent years. This has left local industries scrambling to find workers, with some businesses raising concerns that the focus on attracting high-yield tourists may be sidelining the budget travelers who were previously vital to the agricultural sector.

While backpacker tourism may benefit the local economy by injecting much-needed spending into regional areas, it also creates a delicate balancing act. Infrastructure, such as accommodation and local services, must be expanded to accommodate the increased number of travelers, without overwhelming the community’s resources. Over time, the influx of backpacker tourism can cause a diminished quality of life for locals, as they face rising costs and the environmental degradation caused by the continuous flow of low-budget visitors.

Regulation and Reforms in the Pipeline

As the ethical concerns around backpacker tourism become more pressing, both Australia and New Zealand are taking steps toward reform. In Australia, the Migration Strategy 2024 outlines plans to reform the WHM visa program, focusing on enhancing labor protections, improving accommodation standards, and ensuring that backpackers are not exploited. There are growing calls for decoupling the working holiday visa from employer dependency, allowing backpackers to have more freedom and protection while working.

Meanwhile, in New Zealand, the government has introduced measures to increase the tourist levy to fund sustainable tourism efforts. The move aims to ensure that international visitors contribute more to the upkeep of local infrastructure and the preservation of natural resources. This tourist tax could help address some of the environmental and infrastructure strain caused by the influx of low-budget travelers.

However, both countries still face significant challenges in addressing the ethics of backpacker tourism. While reforms are on the horizon, they must go beyond simply increasing taxes and adjusting visa requirements. The focus should be on ensuring fair wages, safe working conditions, and sustainable accommodation for backpackers, as well as ensuring that local communities benefit from tourism without suffering from the negative externalities it brings.

Looking Ahead: The Future of Backpacker Tourism

The future of backpacker tourism in Australia and New Zealand hinges on striking the right balance between economic growth and ethical responsibility. Both countries must adapt to the growing demand for responsible travel and sustainable tourism. As the tourism sector continues to recover and grow, backpackers will likely continue to play a vital role in both economies. However, the way they are integrated into the workforce and the tourism ecosystem needs to change.

Australia and New Zealand must find ways to protect backpackers from exploitation while ensuring they remain an integral part of the tourism sector. With the right regulatory reforms, it is possible to create a backpacker tourism model that is sustainable, ethical, and economically beneficial for both the travelers and the communities they visit.

For further reading on backpacker tourism, refer to the following articles:

• New Zealand to nearly triple tourist tax for international visitors
• New Zealand needs tourists right now, but locals say its newest campaign is cringeworthy and tone-deaf
• SA’s tourist trap: SATC bid for big spenders backfires

The post Australia and New Zealand Sees New Backpacker Tourism in Facing Skyrocketing Exploitation, Cheating, and the Explosive Downfall of Budget Travel appeared first on Travel And Tour World.