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Skills Index shows NZ failing to meet labour demands

Skills Index shows New Zealand failing to meet labour demands

The 2017 Hays Global Skills Index has been published, highlighting New Zealand’s struggle to keep pace with labour demands.

The report, published in collaboration with Oxford Economics, shows that despite an existing pool of labour, employers in high-skill industries still find it difficult to fill jobs that require highly-skilled professionals.

“Demand is much higher for professionals in high-skill industries relative to medium- and lower-skill industries across New Zealand since a lot of routine, repetitive jobs can now – or will soon be – automated,” said Jason Walker, Managing Director of Hays in New Zealand.

“While New Zealand’s participation rate has increased, so too has the creation of jobs, particularly in highly-skilled industries. The latter has absorbed the former, leading to high demand for talent from employers in high-skill industries such as engineering and technology. The resulting wage pressure in high-skill industries cannot get more acute.

“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.”

The Index is calculated through an analysis of equally weighted indicators. Key indicator scores include:

• Talent mismatch: New Zealand scored 4.6, suggesting there is a gap emerging between the skills employers need and those in the labour market;

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• Wage pressure in high-skill industries: New Zealand scored 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. This score is unchanged since 2014;

• Overall wage pressure: New Zealand scored 2.6, which is a low-pressure score. This suggests that employers are holding tight, despite wage pressure in high-skill industries, and they are not using salary to compete for talent overall;

• In positives, the education system is well equipped to meet future talent needs (‘education flexibility’score of 4.7) and our labour market legislation is fairly flexible (‘labour market flexibility’ score of 4.2).

“Based on the trends we have seen this year and in previous iterations of the Index, the talent mismatch could be eased by ensuring we’re ready for technological disruption through training and education,” says Jason.

“Even though the rise of technology and automation in the workplace will inevitably eliminate some job categories, it’s important to remember that technology creates demand for new jobs as much as it will render others redundant. People must adapt their skillset to meet the new demand brought about by a more tech-centric work landscape.

“Similarly, employers should look to adapt their training for workers whose jobs will be changed rather than eliminated through technology.”

The Hays Global Skills Index is available at

For details of the particular skills in short supply, please see our latest Hays Quarterly Report.

For current salary trends, please see our 2017 Hays Salary Guide.


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