Good Business: New Zealand’s Skills Shortage and Employment of Skilled Migrants

New Zealand’s Skills Shortage and Employment of Skilled Migrants

 

“Skilled Migrant”

 Someone who is skilled, has the knowledge and ability to do something well. If people migrate, they move from one place to another. – Collins Dictionary.

 People who have skills that will contribute to New Zealand’s economic growth. – Immigration New Zealand.

This article is not taking a political stance. It is highlighting the complexities in the current Immigration space and how to critically evaluate and navigate your way as employer or Skilled Migrant worker.

 

Immigration Reset confusion

New Zealand businesses are suffering a shortage in both skills and labour post Covid, a perfect storm created by factors such as the decrease in population growth, New Zealanders heading overseas again, excess retirement aka the “Great Retirement” and the not so new Immigration Reset.

In August 2022 Economist Brad Olsen stated that the population growth is at a 36-year low, his finding supported by Stats NZ data.  Net migration has fallen to its lowest levels since the 1990’s and the current labour market shortage is likely to continue.

The Immigration Reset was designed to rebalance the immigration system and make it easier for the Skilled Migrants we need to get a fast track to residency. Unfortunately, rather than make it easier for Skilled Migrants to be eligible for residence, it appears to be achieving the exact opposite.  Special Green Lists with high thresholds on qualifications, above median wage requirements, and a very limited range of required skillsets is causing headaches for all operating in the immigration sphere.

 

Chef vs Cook

The different requirements for Chefs and Cooks is an example that left everyone astonished, causing restaurants to close their doors because of the shortage of Chefs.

A “Chef”, who might have trained under world class Dabiz Muñoz in Spain, but without a Level 4 NZQA Professional Cookery qualification (ie. New Zealand cooking school qualification), could not get a work visa but “Cooks” (ie. Cooks not Chefs) could get a work visa based on their experience only (ie. no NZQA requirement needed if they have experience instead).  This anomaly was overturned on 18 October 2022; however, we will need to pay our Chefs and Cooks $29.66 per hour from 27 February 2023 as the Median Wage for immigration purposes will go up.

Skilled Migrants want certainty, whether they are in the hospitality industry or any other industry.  A Chef migrant uprooting their family to New Zealand to fill a much-needed Chef position, wants to know that they can get residence, unless it is their choice to live a nomadic lifestyle.  Without certainty that they can get residence in New Zealand the lush borders of Australia might attract them.

 

The confusion continues

Under the Immigration Reset, sectors which rely on migrant labour, like tourism and the primary industries, are intended to look different in future and to replace unskilled migrant labour with higher-valued jobs and the expectation is that industries will invest in automation and new delivery models.

The reset resulted in our tourism industry struggling the most. It is our largest export industry delivering pre-Covid $40.9 billion to the country. Our hospitality, horticulture and agriculture industries are also struggling because the Reset settings.  Under the settings, supposedly gone are the days of employing cheap “woofer” and “travelling student” migrants.

But a recent Beehive article has stated:

“Our government recognises the crucial part working holiday visa holders’ play in the New Zealand economy. We need their skills here to meet demand in industries like tourism, hospitality, agriculture, horticulture.  Since the beginning of November, we have seen weekly arrivals of over 1,200 visa holders.  Monthly arrivals have built, from 1000 in July to over 4000 in October. “

 This is 2022 data.  A Working Holiday visa is a visa issued to a typical student (low skilled, low value) travelling and working, for a year. Issuing easily obtainable, low value, low skilled visas to smooth over the long-term shortage of skilled labour is raising some eyebrows.

Further confirmation of numbers of low skilled short-term visas issued:

“Over 17,000 working holiday visitors have now arrived in the country, out of the 36,000 approved since March, providing much need labour during a time of global shortage.” 

Employing a Scandinavian student worker for a year might sound like a good solution to the current labour shortage, but is it feasible and efficient to retrain a new student every year as you hand over the position from working holiday student to working holiday student?  Should a newly employed student be the face of our $40.9 billion tourism industry?

 

Employing Migrants as an Option

Employment of Skilled Migrants is an integral part in any economy whether you are for or against the concept.  An OECD Migration report found that: migrants positively contribute by filling important niche sector jobs; contribute more in taxes and social contributions than they receive in benefits; have the most positive impact on the public purse; boost the working-age population; arrive with skills and contribute to human capital development and contribute to technological progress.

There are a number of pathways to get your Skilled Migrant employee into the country.  To employ them, your business will have to be Accredited with Immigration New Zealand.  The most prudent option would be to ensure that your Skilled Migrant employee can also qualify for residence so that you are sure you are able to keep the employee for a period longer than a year and knowing that if they don’t get residence they will have to leave the country after three years.

A holistic approach is needed, looking at the employee’s situation from entering New Zealand on the Accredited Employer Work visa to the point of obtaining residence and without residence we are back looking for new migrants to fill our job shortages.

 

If you have any questions, please contact us for an appointment T: 06 3490090 or email joamariv@horsleychristie.co.nz.  You can also visit our website at www.horsleychristie.co.nz

 

Joamari Van der Walt │ LLB │ BComm(Econ)-Law (Stellenbosch) │

SOLICITOR

 

Disclaimer: This publication should not be construed or acted on as legal advice. It is brief and general in nature. Specific advice should be sought.

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https://www.newshub.co.nz/home/money/2022/08/economist-brad-olsen-says-current-labour-shortages-to-continue-as-population-growth-hits-36-year-low.html

[1] Hon Michael Wood 15 November 2022 https://www.beehive.govt.nz/release/new-zealand%E2%80%99s-tourism-rebound-continues

https://www.oecd.org/migration/OECD%20Migration%20Policy%20Debates%20Numero%202.pdf