Never mind the chief executives and TV cameras in the CBD – it is a small business grouping in west Auckland that has both the new Prime Minister and Deputy Prime Minister as a captive audience, to talk through the challenges for struggling employers. Jonathan Milne reports.
Mark Hauser and his tech firm can break the wind-powered land speed record. Their track bikes can win Olympic medals; their racing yachts can win the America's Cup. They can help fly a Nasa satellite to deflect an incoming asteroid.
But they can't get the people they need into New Zealand. "We're struggling for workers," says Hauser, founder of carbon composites manufacturer Southern Spars. "I think everyone is. It's hard and it's expensive, and there's no help."
Behind closed doors on Thursday afternoon, a lawyer for Southern Spars challenged Prime Minister Chris Hipkins to relax immigration and work visa restrictions to help ease the workforce crisis for New Zealand employers.
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That was also the main message that came through from big corporates who met Hipkins at the Auckland Business Chamber on Thursday morning, and from the other small to medium-sized company owners who met him that afternoon as members of the Rosebank Business Association in west Auckland.
Hauser wasn't at either meeting, but Southern Spars immigration lawyer Aaron Martin was there at Eurotech Designs on Rosebank Rd, championing his concerns. Already the company is trying to fill 10 vacancies. "Our workload is looking really strong for the next two years," Hauser tells Newsroom, "and and if everything lands we could be looking for 50 people – and that would be impossible."
The roles range from entry-level boat-builders at about $30/hour, up to designers and managers on six-figure salaries. The company is able to expand its facilities overseas in Spain, Holland, Sri Lanka and the US, and is looking to open a facility in Poland. "New Zealand is where our hub is, and where our skills are, and where out smart people are; we want to grow it here."
"It's an important topic," Hauser adds. "If they want to get inflation under control they need to open up the borders."
In a week that Hipkins had said would be about listening, not announcing policy decisions, Aaron Martin says he won two concessions.
First, the ministers agreed that Immigration NZ was desperately under-resourced, and would call on experienced personnel from other government agencies like Internal Affairs to help clear the backlog of applications.
Secondly, they agreed there were problems with Immigration NZ's online application system, that the agency was working to fix as a priority.
But the acknowledgment Martin didn't get was the one that he and his clients really wanted: freezing the median wage threshold for working visas. That's right – the median wage.
(It's the minimum wage that the National Party has been arguing should be frozen, to avoid an inflationary price spiral. But the upcoming minimum wage decision wasn't a concern highlighted by either group of business leaders.)
"There's employers out there who are gonna say, 'well, if I have to start paying $29.66, then I have to start increasing my prices. Maybe it's just cheaper for me to actually lay off all my staff and just import the product'." – Aaron Martin, NZ Immigration Law
Martin says his concern is that to bring in an overseas worker, an employer is required to pay at least the median wage. That number is written into the regulations: at present it's $27.76 an hour, and at the end of February will increase to $29.66. He pleaded for it to be left at the existing rate, but says the ministers seemed committed to pushing ahead with the stipulated increase.
"I admire the Prime Minister and Deputy Prime Minister for getting out there so quick. I appreciate it's a difficult position to be in on day two in the job. You can't suddenly start throwing promises around," he says.
"But it's really simple. The issue is about getting international talent into New Zealand. And we've got an immigration department that is under significant stress. I was heartened to see that they are aware of it and looking at some form of resourcing through other parts of the public sector to try and address it."
Martin asked that the increase to the work visa median wage threshold be postponed, to help ease wage inflation. Because if employer had to pay above the odds to get overseas workers into the country to address shortages, then their local workers would understandably expect to have their pay increased as well.
"There's employers out there who are gonna say, 'well, if I have to start paying $29.66, then I have to start increasing my prices. Maybe it's just cheaper for me to actually lay off all my staff and just import my widgets and just become a wholesaler, right? So there's 15 jobs gone'."
He rejects the suggestion that low-skilled jobs should go to New Zealanders entering or returning to the workforce. "They don't want them," he says. "Frankly, the labels of low skilled and high skilled are actually dead in the water in the 21st century.
"I had big business this morning, small businesses this afternoon, because we all have a shared interest in making sure that the New Zealand economy is really pumping and creating the sort of opportunities that we all want New Zealanders to have." – Chris Hipkins, Prime Minister
"Immigration NZ has acknowledged that, because they've moved away from defining 'low skilled' in words – now they just simply use an arbitrary number. How much does it pay? In an immigration context, low skilled is going to be anything that pays less than $29.66."
He says the sort of jobs being recruited overseas may be below that threshold, but they do still entail distinct skills like cooking overseas cuisines. Employers can't just hire somebody from Work and Income and expect them to do the job.
And for jobs that are genuinely manual labour like cleaning hotel rooms, there simply aren't enough New Zealanders who want that work. they were previously filled by overseas students working part-time to fund their studies, or paying the bills while their look to step onto the career ladder.
"You want to look down your nose at those people who you might consider to be low skilled, but they are the ones that are looking after your grandparents in the retirement village. Who are wiping their backsides and cleaning up their vomit." – Aaron Smith, NZ Immigration Law
"We've spent generations telling our kids go out and be an engineer, go out, be a carpenter, go out and be an IT specialist. Now we're saying, oh my God we're short of people who just want to do cleaning. Why the hell are we surprised?
"You want to look down your nose at those people who you might consider to be low skilled, but they are the ones that are looking after your grandparents in the retirement village. Who are wiping their backsides and cleaning up their vomit."
"You can't turn around and say to your kids, hey, you know I was wanting to go out and be an ICT specialist. I've changed my mind. And son, I'd really like you to go out and start a career that involves you getting up at 4am and having your arm buried up a cow's backside and go into the dairy industry, please. New Zealand kids aren't going to do it.
"I think that putting this label on people as 'low skilled' actually does us a disservice. There is value in these jobs – so how can we find people to do them?"
After speaking with the corporate chief executives and chairs, Chris Hipkins says they laid down some issues they would like to see the Government working on. "It will be no surprise to know that labour shortages, of course, were at the top of that list."
The Government is keeping the immigration settings under review: "You'll see that we've made changes a number of changes already to our immigration settings as part of the immigration rebalance. So I certainly wouldn't rule out further changes.
"The conversation that I had with the business community, though, was about making sure that we're getting the balance right with activating the New Zealand workforce, getting Kiwis into work, particularly thinking about that 10 percent of young New Zealanders who aren't engaged in education, training or employment. I think we've all been of interest and getting them into the workforce."
The relationship between business and government is a really important one, he adds. "It is integral to the economy. We have shared interests here, in making sure that we create good, well-paid jobs for New Zealanders – because that's how Kiwi families are going to be getting ahead. And we all want to see the economy continue to grow. The rising tide lifts all boats."
The Thursday meetings were Chris Hipkins first external meetings since being sworn in as prime minister this week – and the decision to focus on business, especially Auckland business, was very deliberate. "I had big business this morning, small businesses this afternoon, because we all have a shared interest in making sure that the New Zealand economy is really pumping and creating the sort of opportunities that we all want New Zealanders to have."
Writing on Newsroom this week, BNZ's international business head Evan Veza called for the public and private sectors to come together this year to explore innovative immigration solutions to attract talent, like those schemes being set in place by Australia, Canada and the UK. "The business community is looking to the government to initiate and lead this kind of collaboration," he said.
