New Zealand is a country with an exemplary government and legislative structure. While the country remains the top choice for many immigrants, recent challenges have led locals and immigrants to revisit their ideas. Logistics is one of the core industries contributing to the economy of New Zealand. Dealing with the post-COVID effects, the country is severely struggling to keep up with labor demands in the logistics sector. The current labor shortage of 4,700 is expected to reach 17,900 by 2028. Based on these factors, we will discuss the impacts of worker shortage in New Zealand.
Worker Shortage in New Zealand: The Possible Impacts
The logistics industry massively contributes to the country’s economy. However, the post-COVID period has not been perfect for workers employed in the industry. The core reasons behind worker shortage include rising fuel costs and immigrant employment problems.
A recently published report highlights that worker shortage is primarily due to active employees quitting the sector. Let’s dive into the details to know the possible impacts.
Alternative Employment Interests
One of the possible impacts of worker shortage in New Zealand (in logistics) is alternative employment interests. Since New Zealand is a great place to settle down, locals might prefer opting for other industries instead of moving abroad. Such scenarios may create an imbalance in the overall employment structure of the country.
When one of the high-paying and high-contributing industries faces a worker shortage, other industries will also bear the impact. Workers’ compensation in other fields may raise new challenges for the government. However, the problems may only occur with saturated workers in each industry.
Replacement of Human Workforce
New Zealand has kept pace in adopting modern technology and automated systems. If the worker shortage continues to be a problem, the government might consider replacing necessary human functions with AI systems. Automation may support logistics with partial interference of workers.
Another perspective is an alteration of roles. Workers might be asked to operate in different capacities within the same industry. Such scenarios may lead to mutually agreed employment solutions in the logistics industry between employees and employers.
With more locals quitting the logistics sector, the government may encourage skilled and qualified immigrants to take active roles in the industry, which may depress local wages in the short term. Typically, foreign workforces are more cost-effective in terms of recruitment and payroll.
It is only a matter of time before the government decides to deal with the worker shortage problem. Based on the government’s bold decisions in recent years, we can hope to find more clarity on the issue in the coming years.
The above discussion highlights the possible impacts of worker shortage in New Zealand (logistics). If you want to stay ahead of global compliance and international employment laws, visit Global People Strategist today and schedule a demo to learn how we can support your business.