The Labour Shortage in New Zealand

So Why Is New Zealand Struggling With a Labour Shortage?  ‍

Some of the prominent reasons for labour shortages in New Zealand are: 

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The COVID Effect 

Generally, there has been a labour shortage in New Zealand for quite some time.  However, due to travel restrictions implemented during the first stages of the pandemic and the resulting closure of New Zealand's borders in March 2020, this problem has compounded for New Zealand employers. ‍

The workforce in New Zealand prior to 2020 had been topped up with migrant workers entering on visas such as the skilled migrant visa NZ. However, coupled with the after-effects of the closure, we are still seeing major employment gaps across the board and new immigration policies that have caused further delays for New Zealand employers, which are not expected to improve until 2023. ‍

New Zealand citizens are enjoying a high rate of employment. However, we are in desperate need of more people from overseas to fill vacancies. Immigration NZ introduced a NZ Green List to prioritise some specific skilled labour roles. However, this is not a quick road to recovery for our Kiwi companies.

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Skill Mismatch

Employers are reporting a mismatch in the skills advertised when applicants are applying for jobs, with a high proportion of applicants deemed to have a ‘lower skill level’ than the job advertised. ‍

With fewer people to choose from, and only immigration now restarting, employers need to be resourceful. Possible solutions suggested are for companies to look at upskilling and implementing in-house training programmes to counteract this issue. However, this adds to the extra cost of onboarding new employees and is long-term rather than an immediate fix.

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Reduction of the Qualified Skilled Workers

Due to border closures, New Zealanders are now finally able to take steps to move overseas themselves. It has always been important for Kiwis to travel and experience overseas work opportunities due to the nature of our location in the world. However, for our employers, this is another issue compounding labour shortages. 

With skilled jobs, proper training and education are vital to the supply of labour across different industries across New Zealand. However, the number of apprenticeships has also been falling, and graduates in engineering and healthcare are too few to meet the demands.‍

With New Zealand's aging population, we are heading for a high retirement rate within the next decade, which will also impact the availability of skilled workers.  Highly skilled degrees take time to nurture. Therefore a longer-term strategy is needed to educate New Zealanders and, at the same time, increase immigration to counteract this drop in the workforce to meet demand. ‍

General practitioners, for example, are estimated to see their workforce reduced by fifty per cent in the next ten years due to retirement. The lack of new graduates in this area will push New Zealand to look to international shores to fulfil their health care needs.

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Winning Strategies for Attracting Qualified Migrants Workers

If you hire migrant workers as an accredited employer,  there are ways to retain your local team and attract international candidates on a skilled migrant workers visa. Some are:

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Focus on a Positive Company Culture

By taking care of your workforce, you boost your ability to attract new workers. The migrant workers will be more inclined to take a chance on a relocation if they can see you care for your workforce, their physical and mental health, their work/life balance, and their families. 

After COVID with the implementation of the hybrid work model, migrant workers are also looking to the New Zealand job market to equal those, so do your research if you are struggling to attract applicants.

Focus on Worker Retention

Worker retention can stem the flow of labour shortages and can be addressed by improving the company culture. However, keeping employees loyal and working for you may mean increasing salaries to meet the rising cost of living and providing clear career paths for your workers.

If your competitors pay higher salaries and have higher standards of care or work/life balance, your workers will look to you to match these. Training programmes, career progression, and education are also key elements for retention.

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Skill Development Programs

As the labour shortage continues, to grow as a business, you may consider investing in your current employees and hiring migrant workers. ‍

As employers, you can upskill your workforce to meet your labour gap by:

• Developing and rolling out internal training programs for current workers to fill the gap you are missing and staff may benefit from career development. 
• Hiring skilled overseas contractors who can coach your team and help to implement the work you need. 
• Become an accredited employer and employ migrants who will work alongside your current workforce to lead the upgrade of skills.

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The Change to Securing Foreign Workers

Immigration New Zealand implemented the Accredited Employer policy mid-way through 2022 to ensure employers responsibly hire and support migrant workers and their local ones.

The new rules for employers require that migrant workers are offered advice and education from their employers to help them transition into working and living in New Zealand and are provided with financial stability for themselves once they are here.

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Green List Opportunities in New Zealand 

According to the Accredited Employer Work Visa (AEWV) policy, the Ministry of Business, Innovation, and Employment (MBIE) are targeting key skills shortages within New Zealand. MBIE has formulated a Green List of occupations for immigrants. Depending on their skill set,  migrants will be eligible for either a direct path to residency visa or required to work for two years before they can qualify for residency (work to residence visa)

There are mainly two tiers of jobs on the Green List. ‍

Tier 1: Directly provides migrants with a resident visa. If they satisfy all the requirements in any job included in tier 1, they are allowed to reach New Zealand on a work visa and then apply directly for residency from the 5th of September, 2022. ‍

Some of the jobs included in tier 1 of the Green List are:‍

• Engineering jobs include chemical engineer, civil engineer, material engineer, electrical engineer, industrial engineer, mechanical engineer, etc. 
• Health and social services-related jobs include general practitioner, anesthetic, special physician, cardiothoracic surgeon, neurosurgeon, vascular surgeon, psychiatrist, orthopedic surgeon, urologist, dermatologist, etc.
• Some ICT, telecommunications, and electronic-related occupations. 

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Tier 2: If they meet all the conditions needed for any job in tier 2, migrants are allowed to enter New Zealand on an Accredited Employer Work Visa. They can then submit their application for residence after working for 2 years with the Accredited Employer Work Visa in New Zealand from September 2023. ‍

Tier 2 jobs comprise: ‍

• Jobs related to health and social care like an anesthetic technician, medical laboratory technician, occupational therapist, nurses etc
• Trade jobs include automotive electrician, general electrician, diesel motor mechanic, etc. 
• Agricultural occupations include dairy farm managers, herd managers, and assistant dairy farm managers.

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If you are looking for how to apply for the green list visa read our article for further advice

Plan for the Future to Avoid the Labour Shortage 

We can only hope the pandemic was a once-in-a-lifetime event. However, it shines a light on the necessity for businesses to plan for the future needs of their workforce and look beyond the status quo to keep and upskill the current workforce. 

Successful businesses that take care of their employees, plan for change and implement strategies to improve their workforce in the long term can proactively protect themselves against the major effects of future labour shortages.

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A Few Takeaways

The Labour shortage is affecting countries all over the world due to the effect of a global pandemic. With its prior policy of isolation, New Zealand needs to address the shortfall of labour effectively to ensure it can recover from a lack of immigration and before the retirement rate increases in the next ten years. 

That’s where hiring skilled migrants and integrating them into your business can support your growth. At Malcolm Pacific Immigration, we can help employers and their migrant workers with any information about the immigration process and how to become an Accredited Employer.  ‍

Get in touch with us today.