Queenstown Lakes labour market insights to August 2022

The following is a summary from a recently released report on Queenstown Lakes labour market conditions and the costs of labour shortages.

The borders have reopened and visitors are returning to Queenstown-Lakes. The additional demand is a lifeline for tourism businesses starved of revenue over the past couple of years. However, finding workers to service this demand remains an acute challenge, despite Queenstown-Lakes businesses offering faster wage increases than elsewhere in the country.

We know staffing remains a challenge because:

  • Job ads are double their level from before the pandemic.
  • The biggest lift in job ads continues to be in accommodation and food services, but this sector still has fewer people employed than this time last year.
  • Jobseeker numbers and migrant workers on employer-assisted visas are lower than last year.
  • 57% of businesses are struggling to fill unskilled roles and 78% can’t fill specialist roles.

What are the costs of labour shortages?

  • 65% of local businesses are currently operating below 75% capacity.
  • Finding staff is the factor most commonly cited by businesses as limiting their ability to grow and meet expectations of higher customer demand.
  • If businesses are unable to adequately increase capacity to cater for the demands of visitors, then we risk losing out on some visitor spending. Every 1% of unmet total visitor demand over the year would be worth $30 million of lost spending to Queenstown.
  • These risks aren’t just hypothetical – already during the month of June alone, it is estimated that as much as $3 million of international visitor spending went unmet.

How can we reduce Queenstown-Lakes’ worker shortages?

There are several areas where government support could help reduce labour shortages. These include:

  • Investment in offshore campaigns to target international workers.
  • Reducing the costs of applying for visas and invest in speeding up visa processing times.
  • Raising awareness of customized secondary tax codes that ensure staff with multiple jobs do not pay too much tax.
  • Ensuring there is financial support for businesses to invest in operating with a leaner workforce.

Not all actions require government intervention, there are also a range of locally-led actions which could help mitigate the effects of labour shortages. These include:

  • Increased co-ordination between businesses of days they close or have reduced hours.
  • Broadening recruitment to target different groups, eg. older residents, parents during school hours, casual employees, and remote workers.
  • Develop packages of perks and benefits for workers to experience visitor activities to assist in worker attraction.
  • Focusing on staff wellbeing.
  • Explore opportunities for seasonal crossovers between industries with different seasonal patterns.

The full report is available here for download.