Immigration lawyer Aaron Martin explains why NZ businesses are suffering a shortage of both skills and labour – and why immigration policies fall well short of addressing the issue.

Our labour market is tight and is only going to get worse.

A recent Sense Partners report canvassed employers to discover sentiment about worker shortages and put some data behind what the BusinessNZ network had been hearing since the pandemic began; businesses are desperately short of skilled employees and are having significant difficulties filling vacancies.

The report highlighted what we have also been hearing from employers in the last year.

Demand for workers is near record highs

Job ads show demand for labour is at record highs. This, combined with a record low number of people out of work, means it is getting increasingly harder to find workers.

The NZIER’s Quarterly Survey of Business Opinion shows firms are finding it very hard to recruit (hardest on record), and lack of labour is the biggest constraint to growing their business (meaning they cannot make or sell more products without more workers, which is a limit to business and thus economic growth).

Future immigration policy uncertainty

The biggest uncertainty is around the current ‘immigration rebalance’ the government is designing. The data clearly shows our labour market has long been used to tapping into the global labour market through the immigration channel.

An income criterion will limit the global labour pool to a handful of industries

While there are acute skill shortages, there is also a generalised labour shortage across skill and income brackets.

Their analysis of Trade Me job ads showed 86% of job listings in the last year were for an advertised salary of $80,000 or less. Or, 14% of vacancies meet the immigrant pay criterion of 1.5x median income. Vacancies were widespread across all incomes, qualifications, and industries.

Similarly, when they mapped annual median income by industry and qualifications (a good proxy for income potential), they only found a handful of industries and qualifications qualify under the new income criterion.

What is Immigration NZ doing to help employers fast-track visa applications?

Immigration New Zealand (INZ) has 20 percent fewer staff than before the pandemic and has been juggling the surge in one-off residence visas and an overhaul of work visas.

INZ figures show it has 179 fewer workers than before the pandemic. A quick Trade Me/Seek search shows there are no extra jobs being advertised to increase the numbers of INZ processing staff.

Visa applications overwhelming the system

Since December, INZ has received 91,000 applications for 181,000 people to get residence under the government’s fast-track scheme. And next month, the twice-delayed Accredited Employer Work Visa (AEWV) will begin to replace six work permit categories, with the first visas due in July.

What should the government do to resolve this crisis?

New Zealand needs immigration at all skill levels, and we need to welcome migrants back to New Zealand and acknowledge the contribution they make to the economy and our communities.

If you need help or advice with your visa application, speak to our team.