The government feels it has the balance of migration settings “about right,” although a decline in the net number of Kiwis leaving New Zealand compared to previous cycles is challenging that, Prime Minister Bill English says.
Speaking Monday afternoon after figures earlier showed record net migration to New Zealand in the year to January 2016, English said the economy required current migration settings to fill skills shortage gaps.
Business leaders in the hospitality, horticulture, agriculture and IT industries, in particular, were constantly telling the government they were facing skills shortages among the local population, English told media at his post-cabinet press conference.
“They really are going to struggle to get the people they need, particularly in the regions. This is the type of balance we’re trying to [reach],” he said.
A rise in local wages could help fix that problem, and certain businesses may have to re-evaluate pay settings to entice Kiwis into work, English said. However, when put to him that businesses might not need to do that because owners were able to hire cheaper migrant labour, he replied that there was a balancing act required.
Meanwhile, returning to a favourite anecdote from his days as Finance Minister, English said business leaders were telling him two-to-three times a week that part of the struggle hiring local labour was potential employees could not pass a drugs test.
“A lot of our younger people can’t pass that test,” he said. “Either they change their habits or they’re not going to be able to get a job.” English cited the government’s Tackling Methamphetamine plan as one example of how it was trying to reduce this problem.
Businesses did want locals to fill vacancies, he said. He cited the Hawke's Bay 1,000 project as an example of businesses organising to try and fill 1,000 full time jobs expected over the next four-to-five years. But businesses were finding the task challenging, he added.
The government would also like to be able to match up unemployed people with jobs on the shortages list, although this was “quite a challenge,” English said. In theory this sounded easy, but was different in practice, he said.
In all, these were good problems for New Zealand to have, he said. “We’ve got Kiwis coming home. This is what it feels like to be in a growing economy with some confidence and some direction. And the government is focussed on supporting that growth, not trying to shut it off.”
“This is all a matter of balance. We think the balance is about right, bearing in mind that the biggest single change is Kiwis not leaving,” English said. “It’s really important that we understand that.”