How the cloud can help fill job shortages

SUMMER 2022 Skills shortage to worsen by 38% in just six years

The critical skills shortage in the manufacturing and engineering sectors is set to grow to 40,000 workers by 2028 unless immediate action is taken, a Government report finds

The research commissioned by Hanga-Aro-Rau, the Manufacturing, Engineering and Logistics Workforce Development Council, found widespread disruption caused by COVID-19, immigration policy settings as well as constraints on supply chains and the international labour market will see the industry skills gap continue to widen – if left unchecked.

The report’s authors found that while rates of employment among other ethnic groups now exceeds pre-COVID levels, the pandemic has exacerbated inequities for Maori and Pacific peoples and their participation within the national manufacturing and engineering workforce is up to 25% lower than prior to COVID-19.

The regional impact of the pandemic is even greater with an industry-wide employment decline recorded for up to 32% of Maori and 18% of Pacific peoples – in the Waikato manufacturing sector.

Researchers found that Maori and Pacific workers are at least 10% less likely than other ethnicities to complete training or find work following the completion of their training. Maori are also 5% more likely to receive a Jobseeker benefit five years after graduating than other ethnic groups.

Phil Alexander-Crawford, chief executive of HangaAro-Rau, one of six Government Workforce Development Councils (WDCs) tasked with aligning the vocational educational systems with industry needs and providing support for Maori businesses and iwi development, says more needs to be done to better support Maori and Pacific people into a higher level of vocational training.

He says the research shows Maori and Pacific people favour tuakana-teina (intergenerational learning) and the disruption caused by COVID-19 will have a legacy impact on the pipeline of new workers for years to come.

“We know that Maori and Pacific workers will pass knowledge down through to the younger generations within the workplace.

“They are also an essential referrer to the industry, and it is common to see extended whanau working within the same firm for decades.

“When this link is broken and an individual leaves the industry, the impact on the sector can be far more widespread reducing the pool of potential workers from future generations,” he says.

The study showed that Maori and Pacific peoples will not reach skills parity with other ethnic groups by 2028 without immediate intervention, including new targeted culturally relevant training programmes.

In addition, without net migration returning to pre-COVID levels, the domestic workforce will be insufficient to address the widening skills gap and that increasing the participation rate of groups who are also significantly underrepresented at all levels of the manufacturing and engineering sectors including women and disabled workers, will be essential for reducing the skills shortfall.

Alexander-Crawford says the pandemic has demonstrated industry needs to reduce its long-term reliance on migrant labour to remain sustainable.

He says the skills shortage could be partially offset through investment in technology and improvements in labour productivity.

“Historically around a quarter of skilled labour needs in manufacturing and engineering are met by migrants.

“By 2028 we will need 463,000 workers in key regions around the country, however based on current trends, a skills shortfall of over 40,000 is set to constrain future manufacturing output.

“We need to begin work immediately to reduce barriers preventing the development of an equitable domestic workforce.

“The research has found this is a complex issue to address and will require a coordinated approach from industry stakeholders, the vocational education system and government support agencies,” he says.

Dieter Adam, NZ Manufacturers and Exporters Association CEO, says the shortage of workers at all skill levels is impacting export relationships built up over decades.

“It is not uncommon for manufacturers to be facing a 15% shortfall in their current workforce. Up until around 12 months ago this was mainly at the higher skill levels however this has now grown to include semiskilled labour as well.

“A large part of New Zealand’s manufacturing and