NZ Minister gets real on the value of recruitment in New Zealand

In the latest issue of The Brief Magazine, we caught up with the Hon Michael Wood to discuss the current economy of recruitment and staffing in New Zealand.

Michael is the Minister for Transport and Workplace Relations and Safety, and Member of Parliament for Mt Roskill (New Zealand). Michael was first elected to Parliament in 2016 and says he is driven in ensuring that every person regardless of background has the ability to flourish.


Along with his wife Julie and their three sons, Michael lives in Roskill South where he loves to walk along the Waikowhai Coast and tend to his very neglected vegetable garden…he also dreams about an alternative career as a commentator for international test cricket.


What value do you see in recruitment and staffing?


The recruitment and staffing sector is key to supporting our commitment to getting New Zealanders back to work, and progressing their career aspirations. The sector helps to identify skills needed and in getting the right people into the right jobs. Having the right people who have the right skills and aspirations into the right jobs can help increase business productivity and gives people meaningful work.


I am committed to ensuring that New Zealanders have the opportunity to realise their potential. I believe that this goal aligns with what the recruitment and staffing sector aim to achieve.


We aim to see New Zealanders employed and upskilled over our term, and are investing in public services, infrastructure, and training and education which will help to realise these aims. The recruitment sector will play a key role in getting the right people into the right jobs and training pathways.


A big piece of the puzzle is ensuring that people who find themselves out of work, or not in work that matches their skills or aspirations, or who might be entering the labour market for the first time, can get a steer towards opportunities and the sorts of skills needed.


Concerning permanent roles (both full-time and part-time), what is the value of that work to your economy and how can we get people back to work sooner?


We need to focus not just on people that have lost their jobs, but also on people entering the job market from school or other education or training, and those that have taken a break from work to take on caregiving responsibilities.


Different people will have preferences for different forms of work that suit their individual lifestyles or needs, and will fit in with their other interests or commitments, for instance caregiving or study.


Decent work helps to give people meaning and a sense of contribution. We want all New Zealanders to share in prosperity, feel valued, and have the capability to live full lives, participating in their communities. We are striving to ensure people have good jobs, including working the amount that suits them and their needs, whether this be full-time or part-time, or working as employees or contractors.


What types of employment initiatives are needed in NZ at the moment?


I believe that people can only participate fully in a society that supports strong personal, social, and

economic rights for everyone. A big piece of the puzzle is ensuring that people who find themselves out of work, or not in work that matches their skills or aspirations, or who might be entering the labour market for the first time, can get a steer towards opportunities and the sorts of skills needed.


A few Government initiatives that will support people in work include Fair Pay Agreements, changes the Government has made to the Equal Pay Act, and the Health and Safety at Work regulation modernisation programme led by the Ministry of Business, Innovation and Employment (MBIE).


I am committed to legislating and implementing Fair Pay Agreements which will set minimum standards to lift wages and conditions across an industry. Fair Pay Agreements will prevent a race to the bottom, where employers compete by holding down or reducing terms and conditions offered to workers.


The Government has also passed changes to the Equal Pay Act, giving employees a better way to achieve pay equity. The new Act allows parties to work through the pay equity process together, building collaborative, productive relationships.


MBIE has an ongoing regulation modernisation programme that is focussed on areas of high harm and hazard, and where regulations need updating. One focus has been on plant and structures regulations – these cover areas responsible for 75 per cent of all workplace deaths, about 58 deaths a year.


Additionally, our Government’s Employment Strategy shows our vision for the labour market and our commitment to ensure everyone can benefit from a productive, sustainable and inclusive New Zealand.


We are for example, providing free access to all apprenticeships and to a range of trades training courses for the next two years, along with subsidising employers to take on apprentices. This will save learners between $2,500 and $6,000 a year and save employers around $16,000 per apprentice. We are already seeing results - in November 2020, the number of apprenticeships were up by 24 per cent compared with the previous November.


What are some trends you have observed and how have they affected the sector?


Indications are that employment remains slightly down (-0.1 per cent over the year to November 2020), driven by tourism related sectors such as accommodation, in locations like Auckland and Otago.


This is a more positive picture than we were initially expecting, which is in part because we went hard and early on COVID-19, and we worked quickly to support employees and employers. Forecasts from the Treasury and banks for the jobs market have improved considerably over the past few months.

A number of industries have seen growth in employment, for instance health and social assistance, public administration and safety and construction, as have a number of regions, such as Wellington, Waikato, Bay of Plenty, and Hawke’s Bay.


The most recent NZIER Quarterly Survey of Business Operations (QSBO) shows business confidence improved markedly in the final quarter of 2020, but that labour shortages are becoming more acute:

  • A net 16 per cent of businesses expect a deterioration in general economic conditions over the coming months (an improvement against 38 per cent in the previous quarter).

  • A net 15 per cent of firms are planning to increase headcount in the next quarter, indicating a recovery in employment over 2021.

  • A net 43 per cent of firms reported difficulty in finding skilled labour – close to levels seen in early 2020.


The recruitment sector will play a key role in helping support the wider economy by addressing acute labour shortages through helping to place people wanting jobs or wanting more hours, or in

supporting their next step-up on the career ladder. Ensuring that people are well matched to the best possible jobs and supporting businesses to better retain and grow their workers will also be key.


Thinking about recruiters and where they should focus their efforts, which industries stand out to you as being the most crucial over the next 12-18 months?


A number of sectors have been particularly hard hit by COVID-19. To date, falls in employment have been most noticeable in tourism related sectors due to the closed borders, such as transport, postal and warehousing; travel agencies and accommodation and food services. Job growth has been relatively strong over the year in areas supported by public investment, like construction, health care and social assistance and public administration and safety.


Between December 2019 and 2020, online job vacancies grew by 10.6 per cent, the biggest annual change since the beginning of the COVID-19 pandemic. Over this period, advertised vacancies grew the most in health care (up 31.7 per cent), manufacturing (up 27.9 per cent), and construction (up 15.1 per cent), while they continued to be down in sales (down 7.1 per cent) and hospitality (down 1.5 per cent).


The occupations with the biggest increases in online job advertisements were labourers (up

26.4 per cent), machinery drivers (up 16.3 per cent), community and personal services (up 12.2 per cent), professionals (up 10.1 per cent), and managers (up 7.5 per cent).


What Government incentives might be considered ‘the most attractive’ to businesses in taking on new employees?


The Government is committed to improving the wellbeing and living standards of all New Zealanders, which in turn will increase worker engagement and productivity, and be positive for businesses. In Budget 20, we committed to helping businesses around the country by:


  • Making major investments into jobs and training through a $1.6 billion Trades and Apprenticeships Training Package.

  • Setting up Regional Skills Leadership Groups, so we can better understand and support regional workforce needs.

  • Targeting industry development with Industry Transformation Plans.

  • Establishment of the Connected website, to support better connections between workers and prospective employers.

  • $3 billion infrastructure investment and 8,000 public housing build programme, to boost

  • productivity and create jobs.


Parting notes?

Last year was tough, and a big thank you to everyone for pulling together in helping us to recover the economy faster than expected. While the full economic effects are still to be felt, we will continue to work collaboratively in supporting job creation and retention.


This story was included in the latest edition of The Brief magazine, you can view it here.


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