Venkat Raman
Auckland, August 22, 2022
Employers have welcomed the government’s decision to allow employers to negotiate a lower median wage for foreign workers in some sectors but many say that it does not go far enough.
They say that given the acute shortage of labour in almost all sectors of the New Zealand economy, the government should extend the benefit of a lesser median wage to cover blue-collar jobs including those not on the ‘Short Skills List.
Immigration Minister Michael Wood announced yesterday (August 21, 2022) that employers in the construction, meat processing seafood, aged care, snow and adventure tourism industries can offer a median wage between $24 and $26 to attract migrant workers.
The median wage for migrant labour in all other sectors is $27.76 per hour.
The minimum wage for New Zealanders is currently $21.20 and the government has been saying that this will not be sufficient to attract offshore talent.
Mr Wood said that the government has listened to the concerns of the selected sectors.
“We are confident that these measures will provide the incentive for businesses to fill gaps in their skilled workforce and improve productivity. When we launched the Immigration Rebalance Programme, we learnt from the key sectors that they need time to transition to new rules. Therefore, we worked with them immediately to develop sector agreements,” he said.
Working Holiday Scheme doubled
Mr Wood said that each of the agreements included expectations for improvement, including implementation of workforce transition plans and industry transformation plans.
The move is an attempt to address workplace shortages across the country.
The government is also doubling the Working Holiday Scheme cap for 2022-2023 and extending holidaymakers’ visas. This decision will allow up to 12,000 additional working holidaymakers to come into New Zealand. Those already here with their working holiday visas expiring between August 26, 2022, and May 31, 2023, can be extended by six months.
People who previously held a working holiday visa but could not travel to New Zealand due to Covid-19 restrictions will also be eligible for new visas from October 2022, allowing them to enter by January 31, 2023, and remain in the country for 12 months.
Speaking on ‘Morning Report’ on Monday (August 22, 2022), Mr Wood defended the measures as ‘positive,’ and that they will help to ensure sufficient labour supply for key sectors.
Mr Wood agreed that Covid-19 had brought the world to a standstill and that the hospitality and tourism sectors, which rely on international workers were adversely affected.
“Since our borders have fully reopened, we are seeing working holidaymakers return. About 4000 people are already here and more than 21,000 applications have been approved. These changes will positively impact the workforce and make the most of the increase in working holiday makers we expect to welcome during the peak summer season,” he said.
Mr Wood said that the performance of the companies allowed to recruit foreign workers at a lower median wage will be monitored. Future decisions of allowing these and other companies access ‘the privilege’ will depend on how they have fared.
Appeal for unskilled workers
Employers and staff placement companies say that the severe labour shortage has had an adverse effect on production and supply chain management and that there is an urgent need to address the issue.
“We are happy that the government has opened the borders to all migrant workers but the median wage should be reduced to affordable levels. Ideally, it should be set at $24 or $25 per hour. Our businesses need substantial foreign workers to improve their services and expand their operations. There are already measures in place to discourage the exploitation of migrant workers. Many companies dealing with supplies and logistics are unable to operate to their optimum capacity because of labour shortage,” they said.
Hospitality New Zealand Chief Executive Julie White said that the increased number of visas under the Working Holiday Scheme and the extension of visas are temporary, it will make a significant difference.
“This is a small step in the right direction and we finally feel that the Minister is listening. The government should continuously work with the industry because there is a global talent war. These measures should not be one-off,” she said.
Aged Care Association chief executive Simon Wallace described the Minister’s announcement as good news for caregivers, as some of them will qualify for a path to residency in a few years.
“But nurses are missing from this announcement. Aged care is a nurse-led sector,” he said.
National Party Immigration Spokesperson criticised the government for moving “at a glacial pace” in attracting migrant workers to New Zealand.
“The move is a small relief to businesses, but it is too little, too late. Australia opened applications back in January, whereas New Zealand is opening up mid-year and the visa application fees have nearly doubled,” she said.
