Get it right and all benefit from ‘gig economy’
New Zealand businesses across many sectors, such as construction and hospitality, have had serious concerns for some time about skill shortages in trades and other vocational occupations essential to the functioning of the wider economy. New Zealand needs more builders, electricians, plumbers, chefs, and food and beverage managers.
The Ministry of Business Innovation and Employment and the Construction Strategy Group report highlighted that by 2022 the construction industry would struggle to find another 56,000 workers. Meanwhile New Zealand Trade & Enterprise advised in 2016 that 26 new hotels would be needed just to meet international tourism demands.
This situation arose from a combination of factors, from a lack of investment in apprentices, to some businesses and industries not planning far enough ahead. As well, we are still dealing with the flow-on effects of the Christchurch earthquake and the pace of Auckland’s growth. Overlay this with massive technological change affecting manufacturing, transport and industry, then add to that globalisation and our own demographic changes, with an ageing workforce, and you have what the Future of Work Commission described as “a tsunami of change”.
New Zealand has been forced to open its doors to the world to fill short-term skills shortages as they occur. Better forecasting will help us understand the medium-term needs to ensure our schools, tertiary institutions, businesses and industries train for tomorrow’s work. This is not an exact science, however.
So a loosening of immigration settings is helpful, and although it has been positioned as a new initiative, it is difficult to understand how different it is. Reference has been made to a new type of short-term skills shortage list, and another type of accreditation.
It is disappointing to see labour hire businesses facing even more hoops to jump through. The unions have contingent workers in their sights, and the Employment Relations (Triangular Employment) Amendment Bill before Parliament, if passed, would make it even harder for labour hire agencies to operate.
The widespread view among unions is that part-time, temporary and contract workers should have the rights of permanent employees, and be able to bargain collectively. This view is reflected in the bill in provisions that will suppress, not support, the ability of employers and workers alike to seek innovative employment arrangements.
New Zealand cannot benefit from the economic efficiency and flexibility a contingent workforce enables if a mindset prevails that contingent working is just a means by which workers are exploited.
Part-time and temporary jobs are paths to full-time work. In the last year, many of my company’s contingent workers ended their employment with us to take jobs with their host employers, and over 600 people received a formal training qualification. Recruitment agencies must work with government, unions and other stakeholders to ensure we are seen as part of the solution, not part of the problem. If successful, everybody can benefit from “the gig economy”.
Employees can enjoy flexibility and pathways. Employers can secure the benefits of a flexible and scalable channel of their workforce.
Just as we have a short-term need to fill gaps, the nature of project work is that it will end. Construction projects will finish, and employers require labour periodically. To ensure a framework exists to enable these workers to shift to the next project is paramount. The industry should be regulated, propagated and allowed to flourish, not treated like a necessary evil.
The contingent workforce, currently about 10 per cent of the total workforce, should at least double in 10 years. A flexible workforce requires flexibility for migrant flow and flexibility within the workforce itself.
These changes can advantage the country, and now is the time for all parties, from the Government to businesses, to position New Zealand for the future of work that is here now.