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The workforce skills crisis in New Zealand

How to navigate hiring and retention in the current landscape.

Greg MacDonald and Lara Prentice

The University of Auckland Business School’s Executive and Professional Development team recently hosted a webinar on the current skills crisis in the New Zealand workforce.

Held on Tuesday 12 July, Workforce Skills Crisis in New Zealand, featured Danni Williams, Director of People & Organisations Consulting at PwC, Barbara Harrison, Chief People Officer at GUD Holdings Ltd, and Susan Lowe, Global Chief People & Sustainability Officer at Fuel50. They spoke about the main drivers of the current workforce skills crisis and how to avoid or minimise the impact of it on your business.

What caused the crisis and what can be done?

There are several reasons which explained the cause of the skills crisis – the changing shape of the workforce, the change in skills needed for a role, and the effect of COVID-19 on capacity.
But what do you do about it? A good first step is to close the gap between managers and their team members on several points – business as usual processes, the company and the employees’ long-term goals, personal development, and more.

“The gap between what senior leaders think their people want and what they really want has grown. The biggest gaps are in relation to the importance of value alignment, on-the-job learning, and pay,” Danni Williams said.

Barbara Harrison agreed. “The conversation is now about a human-centred approach. Thinking about what people need and want, and how we can think holistically about how to create an environment that people actively want to be a part of.”

Is that all that can be done?

No. In addition to improving communication, hygiene factors are also important to consider. Remuneration, flexibility, and well-being remain a major priority for employees, with an overwhelming 84% of Kiwi workers expecting flexible working (PwC Workforce Hopes and Fears Survey, 2022). Susan Lowe added to this by stating that businesses need to have a “value proposition which includes their vision, values, and purpose.”
“Employees are looking to move to an organisation where they can have individual purpose and also connect to the purpose of the organisation,” Lowe said. Even things like a brand’s sustainability agenda could drive employees to join.

Where does retention play into this?

The previously mentioned ideas are also important for retention. “In a market where engaged workers are leaving workplaces they like, it’s critical to know what your business’s proposition is and to invest accordingly,” Williams said.

It was also noted that encouraging a human-centred management approach helps with retention. “Employers need for people to ask for what they need. If you’ve got a workforce that can ask for what they need, there’s a good chance you’re creating a culture and environment where people can have their needs met, and therefore don’t necessarily need to look elsewhere,” Harrison comments.

Professional development is still important

The idea of a human-centred approach also extends to traditional retention methods, such as upskilling employees. Upskilling can start right from the employee’s first day. “Mismatched skills are one of New Zealand’s core problems. People enter the job market with skill sets that aren’t well matched to what the market requires. If you were to start anywhere, it would be investing in your onboarding.” Lowe added “Of course as always, career and development are where people want the business to invest. They want to grow their skills.”

What else can businesses do?

Employers need to change their perspective on work in order to attract and retain talent and employ a ‘human-centred design’, in order to adjust to the effect of the skills crisis.

Lowe suggests employers need to “listen to your people about what’s important to them. Often, for example, we default flexibility to working from home, but flexibility can be so much more than that, and flexibility will mean something different for everyone. If you can achieve that something different, it doesn’t matter that some elements will only apply to some of your workforce. If you have listened to what your people need and want, and have a people-first approach, there is a much higher chance of success.”

You can watch the full webinar, including the Q&A session, here.

28 July 2022