Skills crisis deepens as New Zealand workers exit shore
WELLINGTON, NEW ZEALAND — New Zealand’s workforce is experiencing unprecedented challenges as skilled workers continue to leave the country in record numbers, putting pressure on businesses and the economy.
Reassessing recruitment strategies
Hamish Price, CEO of Wellington-based HainesAttract, raises alarms about New Zealand’s escalating workforce crisis. According to Price, this trend is compounded by changes in workforce demographics and an increasing infrastructure deficit.
“While the unemployment rate is starting to creep up, it is still below historic levels and has not climbed as high as expected,” Price notes, underscoring that unemployment is not a remedy for the skill shortages affecting small and medium enterprises, especially in critical areas like engineering, power, renewable energy, and healthcare.
Reviving the international appeal
Price stresses the need for smaller businesses to adopt strategies similar to those of larger corporations, which are proactive in workforce planning and taking a long-term perspective. He highlights the success of the pre-pandemic LookSee program, which attracted skilled migrants with a 75% success rate by offering a real taste of life in New Zealand.
However, he warns, “Brand New Zealand isn’t going to carry talent here all on its own. The offers must stack up, the onboarding has to be right.”
Despite a perceived decline in interest from migrants, Price assures that New Zealand remains a top choice for international talent, necessitating a renewed commitment to marketing the country effectively abroad.
Demographic shifts and the future outlook
Professor Emeritus Paul Spoonley from Massey University points out that significant demographic changes began around 2013 after the Global Financial Crisis, marked by an aging population and a falling fertility rate, currently at 1.53 births per woman, well below the replacement level of 2.1. This demographic trend suggests a future with a smaller workforce, necessitating ongoing reliance on immigration to fill gaps.
Despite a high influx of immigrants, notably skilled ones due to New Zealand’s points system, the country witnessed a dramatic shift in 2024 with a drop in immigration and a significant emigration of New Zealand citizens, predominantly those in their twenties.
Spoonley emphasizes that the issue is not just about attracting migrants but also retaining them, proposing a shift from what has been labeled a ‘brain drain’ to a more beneficial ‘brain exchange’.
He concludes, “We can’t do much about the ageing and those exiting the workforce. And no country has really solved the issue of fertility decline. Which means migration becomes one of the few options that you have to compensate for the coming crunch.”
