Why are skills such a big issue?

In simple terms, skills are such a big issue because New Zealand's industries are increasingly reliant on the quality and relevance of the skills of our workforce: right at the time when we seem to be facing considerable skill shortages.

State of our labour market

New Zealand's labour market and economy have undergone huge change in the last decade or so. We have gone from quite high unemployment and sluggish growth to one of the lowest levels of unemployment and highest proportions of people in work in the developed world.

  • The New Zealand workforce now has around 2.2 million people in it.
  • Only 3.6% of these people are unemployed.
  • Only 19,000 people are on the unemployment benefit.
  • 67% of all New Zealanders aged 15 or over are in some form of work.
  • We work some of the longest hours in the developed world.
  • About 15,000 more people arrive in New Zealand each year than leave.
  • About 120,000 people in our workforce are temporary migrants.

In short, we have managed to get most of the available people into work, and we are drawing strongly on the international labour market.

Despite this, about a quarter of all New Zealand businesses see their inability to get the labour and skills they need as the main barrier to further business growth.

That's one reason why skills are such a big issue.

For more details see the following presentation - "NZ Labour Market Overview - the Skills Challenge":

 NZ Labour Market Overview - the Skills... (1292KB) 
 
 

 

Some other big issues

Another major issue is that our labour productivity (the amount we produce for each hour of work we do) isn't particularly good. Because we have managed to get so many New Zealanders (and others) into work, we don't have a lot of room to grow by just adding more people to the mix. We have to grow by being smarter at what we do.

Yet another concern is that we seem to be doing a lot of education and training that doesn't seem to be very well lined up with the needs of industry, and its very hard to work out what we should study given the huge number of qualifications around.

And finally, we still have a lot of people in our workforce who don't have qualifications, or even key communications, team working and literacy and numeracy skills they need to do their jobs.

It is a pretty big challenge - but it is a challenge that ITOs relish.

 

What we are doing about it: the NZ Skills Strategy

ITOs are working closely with leading business groups, such as Business NZ, trade unions, and government to address the skills issues faced by New Zealand.

Recently a discussion document about the NZ Skills Strategy was released, which sets out how these groups think we can work together to make a difference. We are currently seeking input from anyone interested in skills issues.

Read the factsheet about the NZ Skills Strategy:

Find out more by visiting the NZ Skills Strategy website: