Skills Still In Demand

Much has been said over the last few months in relation to our very high “migration” numbers and there have been no shortage of media reports discussing the fact that we have imported tens of thousands of workers in to the country under the Accredited Employer Work Visa scheme. Yet within those reports, the narrative is always about our exploding population, pressure on infrastructure and the almost ironic fact that we are still short on so many skills.

You would think that if we have been busy importing all these “migrants” then we shouldn’t have ongoing skills issues, or the need to be adding more occupations to our Green List (a list of occupations that immigration considers to be in demand), yet we are and we do.

So what is going on?

Well the answer to that is a bit more complicated, but equally not that surprising and for commentators such as myself, has been pretty obvious from day one. In short, the previous Government talked tough on increasing the skill level of our migration pool, but delivered the exact opposite. We also need to be more transparent and arguably more educated when discussing what these “migration” numbers really mean.

The net result of recent migration programs has been to bring in more people, with the majority at a much lower skill level and most of them here only for a temporary stay. So numbers are up (for now) but the skill level overall of our migration population has in fact fallen quite substantially - all based on short-term reactionary thinking by the last Government, which seems to have found its way in to the thinking of the new administration.

Problems with Definitions

The way Governments and the media classify “migrants” can be very confusing and ultimately often very misleading.

Not All Migrants are Migrants

When New Zealand media and in fact the New Zealand Government report on migrant numbers, they are generally referring to anyone who has an intention to remain in New Zealand for a period of 12 months or more. This means that we are including a whole variety of Visa types in the definition of “migrants”, and for reasons known only to politicians and statisticians, this seems to be the right thing to do. However, migrants are really people who have demonstrated an intention (and have the Visa to match) to live here permanently. Someone coming here for 12 months or study or to work for three years is, at least historically, not been considered to be a migrant. They will never purchase property, are unlikely to impose a long-term impact on our healthcare system and will generally make a much lower investment in to the country than someone moving here to live forever.

We continue to talk about record migration numbers, yet what we are really talking about is a record number of short to medium term temporary Workers, Students or Visitors, with a smaller portion of people coming here for a permanent stay. It is those that are coming here permanently that will obviously lead to our longer term skill base.

Of course temporary Visa applicants also require infrastructure (housing, education, healthcare and so on) but to a varying degree and of course they are not here permanently so that need is transient. The fact that a lot of these temporary Visa applicants will also have no pathway to Residence, and with recent AEWV changes, may find themselves unable to extend their time or they may have been caught up in the wave of migrant exploitation, means that a lot of them may leave sooner than their Visa suggests.

Our first priority, if we are going to spend time every month pouring of migration numbers, is to actually get the right numbers to pour over. Migration statistics should be openly reported with a breakdown of Visa types and length of stay, separating those coming for a good time, from those coming for a long-time. That would obviously paint a very different picture to the one that the media and politicians would prefer you to see.

Skills Still In Demand

A prompt for this article was a recent Radio New Zealand interview with a well-known and generally very well informed journalist who has spent many years reporting on New Zealand immigration issues. You can listen to the interview here, however the standout for me, was the acknowledgement (finally) that whilst our migration numbers (if you consider these temporary Visa holders as migrants) has increased dramatically, the actual skill level of those applicants overall has gone down.

In short, we have been bringing in more lower-skilled workers and less of the highly skilled people we need, which is a complete contradiction to the goals set out by the Labour party when it designed the AEWV system and dropped its “Immigration Rebalance” in 2022. Back then the emphasis was on raising the bar and the skill level across the board - the end result, less skilled people and far more lower-skilled people flooding across our borders.

The question is did we need them? Arguably with the country locked down for two and a half years, there was a pent up demand for labour across all skill levels, however the administration of the AEWV system and the application of a “high-trust” model has meant that we have probably imported far more lower skilled applicants than were actually required.

The current Government has sought to remedy that, but ironically on the same day it tightened up AEWV criteria, it also added more roles to the Green List including Corrections Officers (which sit in the lower skilled bracket).

We Still Need People

Despite very high numbers of temporary workers entering New Zealand, we are still short on a wide variety of skills.

There is always an inevitable tension between protecting jobs for locals, the locals being willing to do those jobs and then the needs of employers. As a Government you can campaign as hard as you like on lifting the skill level of our migrant intake, but when industries start to shut down because they can’t fill roles locally (even with locals available), you have to do something. The issue I see is that the something that was done, was not well managed and effectively ran away from the previous Government, leading to this increased number of lower-skilled temporary applicants making it in. That then becomes a political mudslinging match when everyone is simply talking about volumes and the need to fix it (read lower it).

The challenge then becomes, how do you tighten that all up again, without sending the wrong signals to the higher skilled applicants that you do want. The recent AEWV changes are a great example of how changes targeted at one group of people (the lower-skilled) are often seen by the entire migration market as a signal that its ‘getting harder’ for everyone. Suddenly employers decide that the process has become too hard, and would-be migrants believe the same - despite the fact that for good quality, skilled candidates the rules haven’t really changed at all.

The mistake that our Minister has made so far is to rush in and slap a bit of policy around to try and band-aid a problem, not realising that in doing so, the signals she is sending are having an impact on those who we still want and need - the teachers, the doctors, the nurses, the qualified trades and ICT (to name just a few).

Despite increasing unemployment (increasing slowly) we do still need a wide variety of skills and the Government (and the media to some degree) needs to be clear on the distinction between those coming here to fill temporary gaps and those who are making the move permanently, that will add much longer-term value to the economy and the country as a whole. We also need to move far more quickly on policy reviews and updates. I recently read a post where the Minister had acknowledged that the current Investor Visa needs an overhaul (and it does), and it would likely be reviewed in 2025. A year to revamp a policy is just not good enough and its another year of missed opportunity.

The Outflow Problem

Of course sitting on the periphery is our outflow issue, which is New Zealand citizens who decide to relocate, usually across the ditch to Australia, although some manage to go further afield. This isn’t a new issue, despite the fact that reading recent media might have you believe that we have suddenly decided to leave the country in some sort of mass exodus.

New Zealanders of all stripes have often ventured overseas in search of something different and not always because they are dissatisfied with their lot over here. Generally in times when New Zealand’s economy might not be doing so well as compared to others (particularly Australia where we have ease of access) some decide to purse the greener grass.

That does create a problem in terms of “brain-drain” and logically we seek to supplement that with our migration inflows. I can also attest to the fact that Australia does present a pretty good proposition, having spent a week there recently but equally if you are coming from somewhere like South Africa, then either country would be an improvement, given crime statistics, unemployment and a whole host of other factors.

The simple fact is people move because they want something better, and we will lose locals to other countries - however what we need to be focusing on, is replacing those and adding to our overall skill base with the right mix of skills that solve not just the future labour market needs but build capacity for the future.

I am all in on raising the skill level for our migration intake, but to do so we need clear messaging from our Government on what that means, we need to stop talking about temporary Visa arrivals as “migrants” and we need faster, clearer and far simpler policy measures to make that happen. Having a plan in terms of population would also help (as I have written about before) and a Government Policy Statement on immigration that clearly sets out our goals for securing highly skilled Resident applicants as well as well managed measures to deal with temporary needs as well.

Wishful thinking perhaps, but I will give the current Minister the benefit of the doubt for now, given she is probably still coming to grips with the difference between critiquing the immigration portfolio and actually running it.

Until next week!