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The Productivity Commission makes recommendations on “Immigration – fit for future”

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The Productivity Commission has completed its inquiry into immigration policy settings suitable for New Zealand’s long-term economic growth and the wellbeing of its citizens, setting out it’s findings and recommendations for Government.

View the findings here.

The Restaurant Association participated in the inquiry with a submission to the Productivity and Wellbeing Issues Paper detailing the challenges and preferred settings of our nationwide members. Hospitality has endured significant pressures from multiple angles over several years and we welcome the common-sense approach emergent in the 32 findings and 24 recommendations.

Acknowledging that the Government faces multiple issues in ensuring New Zealand has the workforce, assets and infrastructure necessary for a growing population, our hospitality industry recognises and supports local recruitment and skills development. However, experience has shown that immigration policy facilitating access to the overseas labour market remains crucial for the industry.

Among the key findings welcomed by the Restaurant Association is the Productivity Commission’s acknowledgement of the vital role immigration plays in economic development; and that immigration hasn’t driven down wages or hampered employment opportunities for local people. Of course we want to employ locals wherever possible. But if it isn’t possible, we must look – and have very successfully in the past looked – to the international market.

Additional findings include:

  • Immigration is not likely to be the solution nor the cause of the productivity challenges facing the country.
  • The relationship between productivity and immigration requires a balance of trade-offs between government objectives and a consideration of short run and long run impacts.
  • Immigration has played an important part in New Zealand’s economic development.
  • The use of Labour Market Tests, Skill Shortage Lists and tying migrants to employers can suppress wages and productivity.
  • The supply of infrastructure is less responsive to population growth now than in the past.

These findings broadly align with the views of the Restaurant Association. In our submission, the Restaurant Association requested that Government:

  • Provide equal status to an employer’s voice alongside the views of the employee and the Crown.
  • Introduce an Immigration Statement of Intent, delivered every two years
  • Explore greater skills sharing and workforce sharing arrangements between New Zealand and Pacific Island nations.

Recommendations from the Commission include that Government publishes an Immigration Government Policy Statement (GPS) clarifying how immigration will be managed and connected to other government objectives, including what investments will be made in absorptive capacity. This is a win not only for the Restaurant Association, but every industry that looks to international talent. Clarity is essential, and we need to know what we can and can’t do. Guesswork isn’t just potentially costly, it also impacts people’s lives.

A further common-sense recommendation is that immigration policy should focus on selecting migrants who can make the biggest contribution to the economy and ensuring New Zealand is attractive to skilled migrants. However, this should be qualified to an extent; we believe skilled migrants and those contributing to society come in many different shapes and forms and isn’t limited to the highest earners.

We’re also pleased to see the Commission endorsing stronger links with education and training policies through the GPS, encouraging wages to reflect scarcity, and regularly reviewing visa categories and the residency points system. These measures increase flexibility, which is so important in helping employers and employees come to mutually satisfactory agreements that are also in line with immigration law.

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