Wednesday, 9th August, 2017

Queenstown Lakes District Labour and Accommodation Survey Report 2017

Fact sheet

Extent of labour and skills shortages
• Labour and skills shortages continue to be widespread across businesses in the Queenstown Lakes District. Nearly three-quarters of businesses (71%) in the 2017 sample experienced labour or skills shortages in the past 12 months – a decrease of 15 percentage points from the December 2015 survey. It is pleasing to see the situation has improved slightly but results are still far from good.
• Only 13% of businesses did not expect any labour or skills shortages in the next 12 months.
• Labour and skills shortages remained the highest in the Accommodation and Food Services, Administrative and Support Services, and Construction industries.
• Larger businesses experienced more labour and skills shortages in the past 12 months: 93% of business with 100 or more employees experienced labour and skills shortages, compared to 55% of business with between one and four employees.
• Long-term or permanent roles are the most difficult to fill, with 58% of employers who have experienced shortages in the 12 months indicating that they have most difficulty filling these roles. Slightly fewer businesses are having difficulty filling short-term roles.
• The average number of FTEs is currently 31.2, compared to an average of 33.3 employees required to operate most efficiently. The overall gap between current and ideal staffing levels grew from 5.5% in 2015 to 6.6% in 2017.
• 59% of respondents say they experience labour or skills shortages all year round – an increase of eight percentage points from 51% in 2015.
• The average number of positions advertised has increased from 13 positions in 2015 to 16 positions in 2017.
• It is taking longer in 2017 for businesses to fill positions, with 46% of businesses reporting that it takes more than two months to fill positions in their business, compared to 36% in 2015.
• Seasonal shortages are highest in the summer, with 21% experiencing shortages during November-December and 30% during January-February. Seasonal shortages tend to be lowest during the winter months.
• The impact of the labour and skills shortages in the region means an increased workload for management (19% say this is an extreme challenge and 40% says it’s a major challenge), plus it also contributes to increasing staff turnover (14% say this is a significant challenge and 34% say it’s a major challenge) and affects the ability to meet clients’ or customers’ needs (15% identified this as a significant challenge and 38% as a major challenge).
Barriers to hiring staff
• Nearly-three quarters (74%) of the sample attempted to hire staff who are not New Zealand citizens or permanent residents in the past 12 months, representing an 11% decrease from 2015.
• At the time of the survey, 49% of the 316 advertised positions by businesses in the sample remained unfilled due to the lack of accommodation available, highlighting that the lack of suitable accommodation is having a large impact on businesses attracting new staff members.
• Major barriers to hiring NZ citizens/permanent residents are the lack of NZ applicants in general (68% identified this as always an issue and 17% as often an issue) and shortage of affordable housing for staff (53% identified this as always an issue and 29% as often an issue). A shortage of suitable housing options for staff is also problematic – with 40% identifying this is always an issue and 38% as often an issue.
• Of the businesses that have experienced labour or skills shortages in the last 12 months, nearly three-quarters (74%) have attempted to hire staff who are not New Zealand citizens or permanent residents.
• Likewise, the shortage of affordable and suitable housing options were the biggest barriers to employing non-New Zealanders in both 2015 and 2017. The impact of the short-term nature of work visas was not examined in 2015, however it appears a major barrier to employing non-New Zealanders (31% identified this as always an issue and 31 per cent as often an issue).
• Businesses with more than 50 employees are more likely to lose staff after they have received their residency. This was raised as often an issue or always an issue by 45% of businesses with 50-99 staff and 40% of businesses with 100 or more staff. Fewer than 25% of smaller businesses (under 50 employees) reported this as often an issue or always an issue.
Business solutions
• Nearly all businesses with labour and skills shortages are taking steps to deal with the issue. The main business responses were raising wages and salaries for existing staff (77%), supporting staff members with work visas applications (75%), and providing training and development to existing staff (69%). Over half of the businesses with shortages were also paying above market rates for new staff (60%), holding staff events to maintain morale and business engagement (57%) and offering promotion or specialised roles (55%).
• 66% of businesses are likely to pay 10% above industry standard rates, 39% are likely to pay 25% above industry standard rates, and 22% are likely to pay 50% above industry standard rates, to attract and retain staff over the next 12 months.
• Nearly a third of businesses (32%) are offering staff support with accommodation – an increase of 11 percentage points from 2015 (21%). Only 17% of businesses are working with other employers to recruit staff at complementary times of year.

The survey, conducted by the Knowledge Exchange Hub at Massey University on behalf of the Queenstown Chamber of Commerce, captured responses from 243 business owners across a wide range of industry sectors.