Immigrants framed as a problem rather than a solution
It’s a sign of these troubled economic times that slightly worse than expected unemployment figures out this week were greeted with a collective shoulder shrug, rather than a dollop of despair.
Economists widely expected the Stats NZ’s Household Labour Force Survey (HLFS) to show a further drop in the unemployment rate.
Given that it was already the lowest in the March and December quarters since the 1970s, at 3.2%, bank economists’ projections of a further fall to between 2.8% and 3.1% seemed fanciful.
To be fair, all warned that forecasting was ‘‘tricky’’ right now. And so it proved when the actual HLFS figure came in at 3.3%.
But the other side of the unemployment equation – the labour market – was a case of there’s-good-news-and-there’s-badnews. Good, because salaries and wages, measured through Stats NZ’s labour cost index, rose 3.4% in the year to the end of June, up from 3% in the year to the end of March.
Average ordinary-time hourly earnings, as measured in Stats NZ’s quarterly employment survey, rose at an annual rate of 6.4% in the
June quarter. When it came to the private sector, annual wage inflation was up to 5.2% in the June quarter.
That means more money in more pockets, and that’s a good thing, right?
Well, not when the increase in salaries and wages is still below the country’s annual 7.3% inflation rate and the 7.4% overall cost of living increase. What’s more, the stretched labour market is driving inflation and threatens to entrench it, which is bad news for governor Adrian Orr and the Reserve Bank.
This is probably the best time in a generation to be applying for a job as bosses fight against each other to offer more and more tantalising money and conditions to workers across the board.
But it’s bad news if you’re an employer. A recent NZIER business confidence survey reported a record 67% of businesses had difficulty getting unskilled staff, with a larger share struggling to get skilled staff.
It also means that Orr will have to keep squeezing the economy with higher interest rates to keep fighting those inflationary fires.
Despite rising wages, there’s
another factor shrinking working numbers: the grass-is-alwaysgreener allure of life in another country. Almost 11,000 more people left the country in the year ended May than arrived.
Government figures estimate that 50,000 New Zealanders could leave over the next year, heaping pressure on the job market. And with New Zealand’s borders now fully open, it’s tempting to leap to the conclusion that migrant workers can fill those gaps.
Think again. The Government’s answer to this confluence of events – to misquote Mark Zuckerberg – is to act slow and break things.
Since May the two immigration ministers, Kris Faafoi and Michael Wood, have been outlining their answers to the skills shortage, what they’ve termed an immigration ‘‘rebalance strategy’’ to fill job shortages.
A strategy based on Faafoi opining, when holding the portfolio, that the country needs to ‘‘stop relying’’ on workers filling low-paid jobs and focus on only highly skilled and wealthy ones.
Its new visa categories seem destined to keep migrants out, rather than welcome them in.
From the ‘‘Active Investor Plus’’ category, which removes foreigners’ ability to buy bonds and property as part of a qualifying investment, and restricts investment companies approved by New Zealand Trade & Enterprise. To the Accredited Employer Work Visa, which has employers jumping through bureaucratic hoops to prove they need the workers, and paying up to $1980 for the privilege.
This week it was reported a construction labour hiring company had laid a complaint after an error on Immigration NZ’s website prevented it applying for a job check for some Filipino carpenters it planned to hire for three weeks. Half of the workers took jobs in Canada instead.
Exacerbating the plight of Accredited Employer Work Visa (AEWV) migrants who do come into the country is the
Government’s decision that from December migrant partners won’t receive work rights but will need to apply separately under the AEWV scheme. While raising the possibility that migrant partners will work under the table, making them vulnerable to exploitation, the message is clear: we want migrants but not their families.
Because as Opposition parties have all pointed out, competition for immigrants is worldwide, not just confined to Aotearoa.
Unless you’re Labour and have drunk the immigration Kool-Aid that believes rising immigration numbers have led to all our woes, from soaring house prices to lower wages to infrastructure pressures.
Well, the migrant tap has been turned off for the past 21⁄2 years and those problems have failed to go away.
At the heart of the Government’s immigration reset lies a quiet xenophobia that has framed migrants as a problem, and not the solution they could be.
It also tells the world that, rather than being open for business, we’re still an island fortress at the bottom of the South Pacific.