Skill shortages – has the open border made a difference?

Written by Christine Whelan.

While the border for Pacific Island Forum countries opened for visa applications as early as 16 May 2022, it wasn’t until 4 July that all work visa categories were opened for application. This included applications for the Accredited Employer Work Visa, which would be tempting for potential immigrants, with its opportunity to speed up qualification for residence.

There were some fishhooks though. The Accredited Employer Work Visa has a median work threshold of at least twice the NZ median wage, and unless this is the case, an employer has to have advertised the role and confirmed there are no New Zealanders or residents available for the job. Many of the jobs where employees are in short supply won’t meet that wage requirement. Nor will many of them meet the so-called Green List of jobs in high demand.

The changes to immigration rules were planned and announced from early 2022 onwards, so there was a reasonable expectation that the changes could make quite a difference for those employers struggling to find staff.

But did it? In my conversations both with clients and with colleagues about their clients I’ve found overwhelmingly that skill shortages are still real. The bite of the Great Resignation is still being felt by employers large and small in most sectors. Employers are finding that those people in the market for employment are still asking for salaries that are anything up to $20k per annum, or even more, than had previously been considered for the role applied for. Which means that employers are faced with a number of options, all difficult. 

  • Do they bite the bullet and pay the inflated rate being asked? If they do, how do they deal with current employees who will probably be paid a lot less for doing the same job as the new hire?
  • Maybe they maintain their stance and lower their recruitment expectations, hoping that the new employee will come up to speed quickly and justify their decision.
  • Or maybe they just soldier on with their existing staff and hope that those promised immigrants will appear.

All these possible ways of dealing with the shortages have their downside, which can in fact make things worse by putting current staff under pressure, or unhappy about your recruitment decisions.

Given that it’s financially more effective to retain the staff you currently have than it is to recruit new staff, we’d suggest that rather than simply focusing on how hard it is to recruit, it is probably even more important than ever to think about how you manage and reward your current employees

In our work with clients, it appears that all the options listed above for dealing with skill shortages are being used to a greater or lesser extent. However, the effect of today’s shortages has led to a number of things happening. Employers are looking at their current remuneration structures and polices to make sure that they are fit for purpose. Are all your roles being remunerated at a level that matches the value of the job in the market? Many employers are considering job sizing for the first time as a way to ensure they have their external market match right. Are all your remuneration policies up to date and reflective of the organisation’s needs today? It may well be time to review your market policy if that hasn’t happened in a while.

Are you up with the play around work flexibility? Are you open to allowing true flexibility in times and places of work? We’re hearing increasingly about true remote working being offered so employees can remain in their current location and still start work for an employer in a different (often far distant) location. Alternatively, employees with a yearning to leave the big cities and relocate to the countryside are now able to do this and still remain with their current employer. A win all round.

It appears that the flood of immigrants we had hoped for is still a vision on the distant horizon. In the meantime, consider how you can best look after the employees you have, particularly those you value. You never know, exactly the right person for that hard to fill job, could be right there, poised to step up and deliver.

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