Skill shortages ongoing, report shows

Skill shortages remain high and will be a long-term feature of New Zealand’s labour market according to a report released today, Department of Labour Deputy Secretary for Work Directions Monique Dawson said.

“Skill shortages are an inevitable consequence of strong economic growth,” Dawson said.

“The Skills in the Labour Market report, covering the June 2007 quarter, shows that the working-age population grew by only 0.2 percent, the lowest quarterly result for nearly two years. This combined with falling net migration (from 14,800 in the year to November 2006 to 10,100 in the year to June 2007) means employers have had a smaller pool of people available to recruit from.

“The labour market has been showing this trend for some time and employers know they need to think outside the square when it comes to recruiting. They need to consider retraining and upskilling existing staff before looking for new people and about offering attractive terms of employment.

“Workers with skills are in demand and have more choices. Offering high quality workplaces and working conditions are important ways to attract and retain these people.

“Labour market conditions will remain tight, certainly in the short-term. The unemployment rate has remained below four percent for three years and fell to an equal record low of 3.6 percent in the June 2007 quarter.

“This report shows there is a slight increase in firms that had difficulty finding skilled staff, up to 42 percent, from 41 percent in the March 2007 quarter. This is at its highest level for nearly two years and is now above the 40 percent average of the past six years.

“There is also an increase in firms that had difficulty finding unskilled labour, up to 26 percent from 21 percent in the March 2007 quarter. It is now above the 21 percent average of the past six years.”

The Skills in the Labour Market report summarises information on skill shortages, mainly focused on the Quarterly Survey of Business Opinion from the Institute of Economic Research and the Department of Labour’s Job Vacancy Monitoring Programme.

The report is available at: dol.govt.nz/lmr/lmr-Skills.asp