A recent report by Statistics New Zealand shows that the number of residents aged 15 years and over who could work increased by 26,500 to slightly more than 4.1 million in 2021. This indicates the smallest gain since 2012 and compares to a 70,500 increase in 2020.
The declining working-age population can cause more labour shortages and impact wages and inflation.
Miles Workman, a senior economist at ANZ Bank New Zealand said, "If there’s a business out there that can’t get imported labor they are competing in the domestic labor pool to fill those vacancies, so most certainly it is contributing to tightness in the labor market."
In Central New Zealand Business Confidence Survey, about half of all respondents listed a shortage of skilled labour as the main barrier to their business. In fact, 75 percent of the businesses said it is harder to find staff than this time last year, and a similar number experiencing increased salary expectations.
"The shortage of workers is hitting every industry in our region," said Business Central and Wellington Chamber Chief Executive Simon Arcus.
These issues further impacts businesses - their operations, bottom line, and mental well-being.
The labour shortage takes place against a backdrop of falling business confidence in the wake of the outbreak of another COVID variant. To battle the challenge busisses seek support from the government and wait for work visas to be granted for all industries. They also look forward to the Government’s immigration plans for 2022.