New Zealand: Immigration ‘reset’ could link migrant numbers to building consents, and tightly limit migration

Always interesting to see how other immigrant-based societies adapt and change policies, generally from a much more restrictive approach compared to Canada:

A Government immigration “reset” aims to make it harder for migrant workers to find jobs, and could see immigration policy linked to building consent numbers.

The Ministry of Business Innovation and Employment (MBIE) is conducting discussions behind the scenes to prepare industry for a big shock after the border opens.

Based on documents seen by Stuff and discussions with some who have been involved in the stakeholder forums, the scheme will allow accredited employers in selected industries with sector agreements to bring in a quota of temporary lower-paid workers.

It may also be harder for skilled migrants who move to New Zealand to bring their partners and family members across with them, and those who come over may have to satisfy separate skills and labour requirements.

IntoNZ Immigration adviser Katy Armstrong says she also understands a “green list” of specific occupations will also be exempt from the reset restrictions.

“That will be what some people in the country will love because they will think it’s great that Government steps in and uber-controls, but it’s a delicate balance isn’t it?

“Because employers also need the freedom to get the right people to do their jobs and I think they’re going to be constrained.”Those industries without sector agreements will have to recruit lower-cost temporary workers who are on open work student visas or working holiday visas.

However, it will be much easier for businesses across the board to hire migrants for highly skilled, highly paid roles.

An MBIE document accompanying the discussions says a key outcome of the changes will be to: “restrict the set of jobs that potential migrants and their families can pursue to work in NZ”

“Some businesses, sectors and regions will find it tougher to adapt.

“Sectors that use large numbers of migrants to fill low-paid, low-skilled roles such as tourism, hospitality and retail.

“Businesses in regions where there are thinner labour markets such as tourism and primary sector businesses in places like Queenstown.”

One of the core aims of the reset is to encourage greater productivity, but Sense Partners economist, Shamubeel Eaqub, says blocking low-skilled migrants, and making it easier for businesses to hire highly-skilled, highly paid migrants from overseas, might actually discourage the creation of a more highly skilled workforce domestically.

“Essentially what we’re saying is that there are these highly paid, highly skilled jobs that are available, but they will be filled by migrants.

“But if you couldn’t do that what would the business do? They would probably train up somebody who was close enough, they might create career pathways, training pathways, scholarships.

“If you are always going to bail-out businesses that need highly skilled people, how are you going to create pathways to become highly skilled in New Zealand?”

The number of work visas issued will be linked to residency places, and residency places will be linked to a measure of the “absorptive capacity” of the economy.

Officials are allegedly exploring measures to better measure this link, including linking residency places to long-term trends around building consents, or the infrastructure deficit.

Some officials are also allegedly warning stakeholders that residency criteria will be tightened too. Presently people who apply for residency need to meet a points-threshold.

After the reset Immigration officers may continue counting points beyond this threshold, and prioritise applications with higher scores. They are also allegedly exploring introducing distinctions like whether a person’s university degree was obtained from a university with a higher international ranking than a New Zealand university (a measure which could benefit European and North American university graduates).

The proposals look set to attract fire from both ends of the political spectrum, with National MP Erica Stanford criticising the approach as the Government “picking winners”, and the Green Party MP Ricardo Menendez March saying it is “a way to sneak in a population policy which would be led by companies”.

March also worries the big role employers will play within the scheme will lead to a large power imbalance between migrants and employers.

With such tight restrictions he argues it may also prove difficult for migrants to switch between employers and jobs.

Eaqub says this is a concern of his too, and it could be difficult for migrant workers to escape an exploitative employer, because they might not have the freedom to take on a different occupation under the proposed system.

Immigration Minister Kris Faafoi was presented with a detailed list of the alleged ideas under discussion, but said they “do not accurately reflect the choices under consideration”, and declined a request for an interview.

He said an announcement around the Immigration reset would be made in the coming weeks.

Sources have told Stuff Finance Minister Grant Robertson is another important force pushing for the changes, however, he too has declined to comment.

March says giving businesses and industries a quota of migrants, that they lobby for, is effectively “devolving these important nation-impacting decisions” to private companies.

“Any move towards have a population policy deserves to have a very fulsome discussion that should be Treaty-led.”

However, it is understood no single population target will underpin the immigration reset, because of fears it could be labelled a “population policy”.

Eaqub sees the lack of a population target as a big weakness within these proposals. Many of the ideas appeared to be about limiting immigration, but equally the country could face issues with a lower than expected rate of population growth too.

A population target could help the country correct for an underwhelming level of population growth, while the current proposals were more about limiting the inflow of skilled migrants.

“Whether or not you’re going to have 10 million people in 50 years time, or you’re going to have 4 million people, actually matters a lot.

“Without that population policy, it’s quite hard to know what kind of capacity we should have as a country.”

However, Eaqub says the alleged immigration changes would represent a real change, because prior to the pandemic New Zealand businesses had access to a range of different migrants, but under the new changes the range of businesses and occupations would be more tightly controlled by the Government.

“What we will have is a bunch of industries, rightly or wrongly, who will have access to workers, and others won’t.

“I don’t know how much faith you have in the skills list that Immigration has used in the last decade or so, but most of the evidence from people in the industry I speak to is the skills list is not accurate, it’s quite dated.

“There’s a real risk that a centrally planned approach will have that issue.”

Stanford says she is worried about a policy that picks favoured industries as winners, and singles out others as being unable to access migrant labour.

“They’re going to a much more highly restricted approach at a time when there is a worldwide labour shortage where we’re competing against other countries in the world for the top talent, and yet we’re making it more difficult.

“If we need people like truck drivers, for example. Well truck drivers won’t have degrees, and if they do, they may not be from a great university, but do we care?”

The Government’s immigration reset has been a magnet for controversy since it as announced, and the Government has provided few details about what it might entail.

Immigration Minister Kris Faafoi was unable to attend the announcement and his fill-in, Stuart Nash, struggled to answer detailed questions about the proposal on day one.

Then announcements around temporary visas, like working holiday visas, filtered through, which appeared to contradict the overall thrust of the policy.

Now, the “Immigration Reset” has been rebranded as an “Immigration Rebalance”.

NZ Initiative chief economist Eric Crampton says one of the problems with the “reset”, or “rebalance”, is that it is targeting a problem that doesn’t exist.

He argues New Zealand has a housing and infrastructure problem, not an immigration one.

“You’re not running out of new cars or used cars because migrants are taking them all. You’re not out of haircuts at barbers’ shops because immigrants have taken up all the haircuts.

“There is nothing else where you’re seeing ‘oh my God the migrants took all these things’.

“It’s just pressure in housing, because we’ve got infrastructure supply that’s been heavily constrained, because the financing of it is a mess, and local councils don’t have abilities to keep up with that.”

Crampton says the root of this problem lies not immigration, but in the supply of zoned land for housing. He points to cities like Atlanta, in the United States, which has maintained a stable level of housing affordability despite high levels of population growth.

To keep house prices down Crampton argues councils need to zone much more land for apartments, townhouses, and other residential dwellings, than they need.

Crampton says making immigration contingent on housing consents, or similar measures, could actually lead to councils zoning less land for housing.

If lower than expected immigration levels are fed into back into future population growth estimates, then councils would have even more reason not to consent more land for housing.

Eaqub also questions the link between population growth and housing affordability. Population growth has been very low over the last two years, yet the number of building consents issued have reached historically high levels – something you might not expect with forecasts of lower population growth.

He believes things like the number of houses being built relative to population are much more based on the political appetite for investment in infrastructure.

“I think all the evidence on housing is that it doesn’t matter if it’s high [population growth] or low, we just suck at building houses.”

Source: Immigration ‘reset’ could link migrant numbers to building consents, and tightly limit migration

About Andrew
Andrew blogs and tweets public policy issues, particularly the relationship between the political and bureaucratic levels, citizenship and multiculturalism. His latest book, Policy Arrogance or Innocent Bias, recounts his experience as a senior public servant in this area.

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