Provincial New Zealand is still crying out for more skilled workers, despite recently strong migration levels, Infometrics economist Paul Barkle says.
Metropolitan areas were soaking up the bulk of migrant workers and expected drops in immigration would further ramp up pressure on regional economies.
A regional skills shortage list — an idea proposed by the Labour Party before last year’s election — could start to address the skills demand felt in the regions while taking migrant pressure off the main metropolitan areas, he said.
As the Government had not yet given concrete details of its regional skills shortage list, Infometrics had thought of a few ideas.
The list should replace the current immediate skills shortage list, Mr Barkle said.
It was intended the new immigration list would replace all functions of the previous skills shortage list, while being more tailored for each region.
Currently, the immediate skills list had a regional element to it but was lacking in both specificity and depth.
Through creating individual breakdowns for each region, the threshold for a skills shortage could be lower, allowing a more tailored fit, he said.
It was difficult for a region with a specific skill shortage to be featured on the Immediate Skills Shortage List unless the shortage was also in other regions, he said.
By creating detailed regional lists, smaller and more specific shortages could be included.
"Consequently, we can expect migration to be more catered to each region’s individual demands."
Prioritising jobs and regions in relatively greater need of skilled workers could also mean the regional list allocated visa points in a more targeted manner, Mr Barkle said.
A differentiated points system would provide more points towards a fruit picker on the East Coast than a real estate agent in Auckland, providing incentives for skilled migrants to move to the regions.
The targeted list would redistribute immigration throughout the country, boosting provincial populations and sharing the spoils of immigration.
An issue with creating a regional skills shortage list was workers could be "relatively mobile", he said.
It did not make sense to advertise for a job shortage in Hamilton when there might be plenty of workers in Auckland for that exact job.
"It makes more sense to drive a New Zealander down from Auckland than to fly an immigrant around the world."
The problem could be resolved by cross-checking the regional demand for jobs with supply in larger labour market areas, Mr Barkle said.
In doing so, the displacement of workers was kept to a minimum while still allowing for a detailed regional skills shortage list.
Businesses were not very good at estimating their own future employment needs, he said. Without accurate forecasts of expected labour demand, the proposed regional skills shortage list would fall short of completing its intended outcomes.
Knowing where workers were needed, and what for, was the most important aspect of the proposed list — although perhaps the hardest to accurately perform.
A potential way for it to occur was for the Government to work closely with local economic development agencies and related organisations, such as local chambers of commerce, to define the list, Mr Barkle said.
The list must also be flexible enough for, or include mechanisms to allow for, skilled jobs to be added or subtracted as labour markets shifted.
The identification of needs should also then be used as an input to a national skills strategy, so over time the structural under supply of skilled labour in regional areas was addressed, he said.
"Labour supply issues cannot be solved solely by immigration or education. Each have a part to play, but they are inextricably linked to the overall growth prospects of regional New Zealand."
A regional skills list would not be the panacea some think it would be, Mr Barkle said.
However, Infometrics’ approach did provide a framework to use immigration as a tool to help take stress of the labour market more effectively.
