The talent mismatch between the skills jobseekers possess and those employers want in New Zealand sits at its highest in seven years, according to research by Oxford Economics and Hays.
Indeed, the 2018 Hays Global Skills Index shows New Zealand fails to meet demand for highly-skilled professionals
The report shows that despite an existing pool of labour, employers are finding it harder to obtain the right talent, particularly in high-skill industries and for roles that require highly-skilled professionals.
Adam Shapley, managing director of Hays in New Zealand, said that despite recent concerns over business confidence and immigration, and an increase to the minimum wage, unemployment has fallen and employers continue to add to their teams.
“The demand for highly-skilled professionals in high-skill industries like IT and engineering is rising (see the ‘wage pressure in high-skill industries’ indicator, below) while more routine and repetitive job tasks are being automated,” said Shapley.
“But highly-skilled professionals are already in short supply (‘talent mismatch’). Add the movement of Kiwi’s back overseas and plans to reduce immigration (‘labour market participation’) and employers have a smaller pool of workers to choose from.”
“Unfortunately those available in the labour market do not always possess the skills employers need, adding to the talent mismatch. This can be very frustrating for both available jobseekers and employers, and points to the importance of continuous upskilling to remain relevant and employable in our rapidly evolving world of work.”
New Zealand’s increase to 5.6 on the overall Index – the highest in the seven years that Hays has produced the guide – shows increased pressure in the job market. I.e., it’s harder to secure the right talent now than it was a year ago.
The Index is calculated through an analysis of equally weighted indicators, each scored out of 10 (1 being an extremely low pressure point, 10 being an extremely high pressure point).
The research found the following:
• Talent mismatch: New Zealand scored 5.3, the highest since the inception of the Hays Global Skills Index in 2012, suggesting there is a widening gap between the skills employers need and those in the labour market;
• Wage pressure in high-skill industries: New Zealand received the highest possible score of 10.0, showing that wages for jobs in high-skill industries are under extreme pressure and sector specific skill shortages (such as in engineering and technology) are acute;
• Overall wage pressure: New Zealand scored 6.2, a massive increase from 2017’s 2.6, which shows that highly-skilled professionals are aware of the demand for their skills and are putting pressure on employers to increase salaries. The 2018-19 Hays Salary Guide confirms that employee salary expectations are higher than those of employers;
• Labour market participation: New Zealand scored 5.4. Employers now have a smaller pool of workers to choose from due to the increase in Kiwis moving overseas and plans to reduce immigration. With labour market participation rates already high, slowing growth may put pressure on employers that want to expand;
• Education flexibility: New Zealand scored of 4.7. This score confirms that our education system is fairly well equipped to meet labour market needs.
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