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Labour Shortage: Increased Migration Needed

Media Release
5 February 2008

Increased Migration Needed to Address Labour Shortages

Today’s labour market data showing strong wage growth provides another strong case to allow increased migration, according to the Wellington Regional Chamber of Commerce.

The Quarterly Employment Survey (QES) and Labour Cost Index (LCI) showed strong annual wage growth in 2007 and point to continued tightness in the labour market.

“The data is consistent with the Chamber’s latest survey of business confidence which shows that Wellington employers are finding it harder to find and retain staff,’ said Chamber CEO Charles Finny.

“The survey showed that 50% of the companies were finding it more difficult to recruit skilled workers than they were three months ago. Staff recruitment and retention were also listed as the key concerns faced by businesses.

“The tight labour market is particularly troublesome in Wellington where businesses face competition from government departments. According to the QES public sector wages grew 5% over the year compared with only 3.9% in the private sector.

“Not only are employees hard to find, but businesses are having to pay more to match high paying government departments.

The QES shows that public sector hourly wages (a broad, nation-wide measure of public employees) were higher than the private sector, $29.52 compared with $21.78. Average hourly earnings for “Government Administration and Defence” workers grew 8.3% over the year, more than any other sector.

“Immigration rules need to be adjusted urgently to relieve the wage pressure, to allow increased migration to meet employer demand,” Mr Finny concluded.


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