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In the past couple of years New Zealand’s Job Market has faced its fair share of challenges, but resilient Kiwis have pushed on.
A pandemic, lockdowns, immigration issues and the resulting lack of skilled workers have presented huge challenges in the employment market, but the threat of a recession appears to be the straw that may break the camel’s back.
RCSA’s latest Jobs Report challenges the experience of some of its member organisations. In December, members were reporting that job supply in New Zealand was up and demand for employees remained strong. However, the advertising data certainly indicates that demand is coming off the boil quite quickly.
In the December quarter the national job index plummeted 22.4% and job postings were a staggering 26.7% lower than at the same time last year.
Demand for all types of employment is on the decline across the country. Permanent job advertisements fell 23.3% in the September quarter and postings for flexible work dropped 18.4% in the past three months.
It seems to have happened rapidly. Previous reports showed demand for staff was strong up until August. There was a decline in the September quarter, but December took things to a new level. Recession chatter, inflation, interest rate rises and the increased cost of living appears to be impacting employer confidence alongside the inability to source skilled talent
“The New Zealand job market was showing strong resilience against economic uncertainty, but it seems that axe has fallen, or perhaps there is now general acceptance of the status quo in relation to unavailability of skilled talent” says RCSA CEO Charles Cameron.
The plunge in job postings was particularly severe in management and professional roles and across the entire non-professional sector. All occupational groups in these categories reported double digit declines. Demand for staff in Public Administration positions was down a staggering 47%.
“A decline here was expected. Government departments have begun to tighten their belts to reduce the deficit", explains Cameron.
“What is interesting is the steep falls in advertising across the board even though skills shortages remain a huge problem."
“It is possible that some employers may have given up trying to find skillsets or accepted that they can not compete with the costs associated with inflation, and withdrawn from the market while others are still looking outside the country or in a worst case sending work offshore.
“Potentially the recent, though delayed, arrivals of skilled migrants in the last quarter may also be acting to reduce the immediate demand.”
In December, RCSA members reported that filling roles was becoming slightly easier with more skilled migrants coming into the country. They observed that without migrant workers, employment in NZ would be going backwards.
“Members are telling us that migration flowing across trades, white collar and IT is a shining light, and we now have a higher number of people responding to adverts."
“They tell us that the market is meeting demand better now that it was six months ago because the flow of migrants, travellers on working holiday visas and skilled migrants, which has given the New Zealand labour market a pool of people it has been sorely lacking for some time", explains Charles.
“The next twelve months promises to be an interesting time with inflation biting, productivity potentially slowing, and greater yield to job advertising reducing the recent advertising rate from historic highs.”
RCSA members can access The Jobs Report for this Quarter here.