On 19 April 2017 the Immigration Minister announced changes to the immigration rules. These changes relate to the skilled migrant category where people wanting to work and live in New Zealand must garner sufficient points to meet a qualification threshold. They take effect from 14 August 2017.

 

The impetus for these changes include the perceived pressure on infrastructure and concerns about low-skilled migrant labour inhibiting wage growth and taking away opportunities for local workers. The National government has reasoned that fewer overseas students will be coming to study low-level qualifications and seasonal workers would stay for a more targeted period of time.

 

The intended consequences include that fewer people will stay in Auckland, more migrants will look to the regions where there may be labour shortages, and the skill composition of the skilled migrant category will be weighted towards higher-paid and higher-skilled migrants.

 

Income a determining factor

One of the principal takeaways from the changes is that income will be a bigger factor in determining whether points are available for skilled work.

 

The median income in New Zealand is about $48,859 per annum. If an applicant will earn less than the median then they will get no points under the skilled migrant category, even if the job was previously considered skilled. Lower-skilled visa holders will be limited to 3 years after which a stand-down period will apply.

 

In contrast, if an applicant will earn more than $73,299 per annum, which is 1.5 times the national median, the applicant will receive points even if the job was previously not considered skilled. This income equates to about $35.24 or more per hour (based on 40 hours per week for 52 weeks).

 

Unintended Consequences

Many applicants will not earn over the median income and many more will not earn over $73,299. Whereas the rules are not retrospective, there are concerns that many existing businesses which may be reliant on migrant labour will be hard-pressed to maintain their margins. Similarly any new business expecting to use migrant labour will be faced with stronger headwinds from having to potentially expend more on labour.

 

Perhaps more critically, because of the 3-year cap on low-skilled migrants, there may be higher forced turn-over of staff at a time when they have been trained and become more efficient after 3 years on the job.

 

Reactions

A group called the Hospitality Industry Advocates has started an online petition to oppose the changes to the immigration rules with over 5,000 signatories so far.

 

The reaction from opposition members of parliament has been that the changes are mere tinkering and will not alleviate the strain on public services and infrastructure, with both Labour and New Zealand First promising to do more to restrict immigration numbers and offer real respite from strained public services and infrastructure.

 

ASB has predicted that migration into New Zealand will remain strong for the next 3 years and this outlook remains unchanged.