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Imperative to focus training on productive sector

Skill shortages reinforce imperative to focus training on productive sectors

The latest Department of Labour report shows skill shortages remain at high levels in the economy and reinforce the government’s emphasis on working with employers, training providers and worker representatives to boost skills acquisition, Minister of Social Services and Employment Minister Steve Maharey said today.

The Department of Labour’s Skill Shortages report for the December 2002 quarter was published on its website today. It examines a number of indicators, all of which point to continuing shortages. Data from the Institute of Economic Research (NZIER) shows that: the difficulty of finding skilled labour increased to a net 39 percent in the December quarter from 37 percent in the September quarter; the difficulty in finding unskilled labour fell slightly from its 17-year high of a net 19 percent in the September 2002 quarter to 18 percent in the December quarter; and the number of firms reporting labour as a constraint on expansion rose from 12 percent in the September 2002 quarter to 16 percent in the December quarter, the highest this indicator has been since 1974.

Labour shortages for the December quarter continued to be concentrated in specific industries. Shortages are evident in the construction, forestry and mining, manufacturing, and cultural and recreational industries. Steve Maharey said the findings reinforce the need for employers and training providers to work together to build skills in industries which are expected to continue to experience demand for growth.

“The Ministry of Social Development is working region by region to develop appropriate solutions tailored to local labour market needs. Recently in Manukau MSD worked with a major employer to recruit over 200 people on the job seeker register to participate in industry training and join this new enterprise. Industry training was organised through the then Skill NZ, now the Tertiary Education Commission.

“This is a good example of the way that employers, training providers and the government can work together to meet specific skills requirements. This type of collaboration is proving successul. Industry and region-specific skills strategies, with the forestry industry on the East Coast and with the seafood, clothing and textile, agriculture and pip fruit industries are now underway.

. . / 2 “That is why, from March this year, I will be meeting employers, training providers and worker representative organisations in regionally-based forums throughout New Zealand to intensify our joint efforts to further meet the needs of our most productive sectors,” Steve Maharey said.

The first forum for the Nelson, Marlborough and Tasman regions will be held in Nelson on March 4th.

“The government has also developed new information resources to help employers and trainers plan to meet the ongoing skills needs of those industries. The WorkINSIGHT publication launched last year is available on the government’s work information portal The information in this document and on the rest of the portal offer tools for everyone engaged in the labour market to assist with planning for ongoing employment needs.

“It is important to recognise that skill shortages have emerged in our economy because we are experiencing a sustained period of growth and low levels of unemployment. While they are a consequence of a dynamic, healthy economy, both the government and employers need to act to ensure skill shortages do not constrain the country’s productive capacity.

“The government’s industry training strategy is a key response to the skill shortages issue. Last year 95,263 New Zealanders participated in systematic on-the-job industry training and the government has committed to boosting trainee numbers to 250,000 within five years.

“Other government initiatives planned to counter skill shortages include: the tertiary education reforms, which require industry and community skill needs to be actively considered when providers are developing their funding profiles; improvements to immigration policy placing a much stronger emphasis on matching skilled migrants with the needs of the labour market; and, improving the information available about skills sought by employers, opportunities for training, and graduate outcomes.

“Each of these initiatives will only work succesfully if business, government and unions work together. Boosting the overall skill levels in the New Zealand workforce today is our best policy for countering skill shortages and increasing the productive capacity of the workforce in the future,” said Steve Maharey.

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