Some employers finding it easier to recruit; others still struggle

1 June 2006

If you’re looking to hire a qualified builder, you may find it easier than a year ago. But employees remain hard to find, particularly in the service sector, according to a Department of Labour report.

The Skills in the Labour Market report showed the service sector faced the largest labour constraint in the March quarter, while building sector skill shortages have eased the most over the last year.

Skill shortages have generally eased compared to the record highs they were at in early 2005, and this trend was likely to continue over the coming year. At the same time, shortages were unlikely to lessen significantly, Communications and Marketing Director Richard Ninness said.

“Recruitment conditions have improved for employers over the past year as economic growth has eased and more people entered the workforce, but the labour market is likely to remain tight for some time.”

Mr Ninness said a big increase in the labour supply recently had helped ease the pressure on employers. The labour force participation rate rose to a record high of 68.5 per cent in the March quarter, and net migration gains recovered over the past six months.

At the same time, almost one in five firms continued to cite a shortage of labour as the main constraint on expansion in the March quarter, according to the Quarterly Survey of Business Opinion released by the NZ Institute of Economic Research.

“Employers need to continue to address long-term skill shortages through initiatives such as increased productivity and training, as well as continue to target skilled and experienced migrants who can contribute to the labour market, when there is a shortage of candidates in New Zealand,” Mr Ninness said.

Findings in the Skills in the Labour Market report were also drawn from the Department’s Job Vacancy Monitor, which showed job vacancies in the March quarter were eight percent lower than a year earlier.

There were still 26 per cent more vacancies than in the same period in 2003.

The Job Vacancy Monitor is a monthly, one-day analysis of 25 newspapers and selected websites across the country.

ENDS