The Labour Market Conundrum: How NZ’s Job Crisis is Driven by AI and Global Talent Shortages

New Zealand’s labour market is facing an unprecedented crisis, with the country losing a substantial number of highly skilled individuals to overseas employment. The root cause of this exodus lies in a combination of factors, including inadequate salaries, lack of opportunities, and the growing demand for skills that are likely to be in short supply due to AI-driven technological advancements.

The Labour Market Exodus

A survey by the Technology Investment Network (TIN) reveals that nearly 47% of all workers in New Zealand’s top-200 tech sector companies are based overseas. Health-tech workers make up the largest group, followed by IT support workers, software solutions, and fintech professionals. This trend is a worrying sign for the country’s future economic growth.

“A feature of these companies is their use of dynamic hiring strategies that balance onshore and offshore expansion,” said Alex Dickson, TIN head of research. “This approach allows them to capitalize on global talent pools while also addressing skills shortages locally.”

Remote Work Arrangements: A Solution to Skills Shortages

Robert Walters chief executive Shay Peters believes that remote work arrangements are one way for employers in New Zealand to manage skills shortages. With a diminishing pool of qualified candidates available locally, employers may need to expand their search internationally and offer remote work options to attract top talent.

“The workforce will increasingly need to embrace continuous learning to stay ahead of evolving technology trends,” said Peters. “It’s no longer enough to simply be proficient in current systems. The ability to adapt to new tools and platforms will be paramount.”

The Growing Importance of Soft Skills

A growing concern is the scarcity of soft skills among the up-and-coming workforce. With a steady diet of digital communication, collaboration, and negotiation skills, many young professionals are lacking the essential social skills required to make the most of AI.

“AI may replace technical tasks, but roles requiring stakeholder management, communication, influence, and the ability to complement AI will remain in high demand,” said Peters.

Management Candidates in Short Supply

Entry-level and junior management talent is also in short supply, with many industries struggling to find qualified mid-senior level managers and executives. Research from Robert Walters indicates that just 11% of professionals consider career progression a top priority, with most Gen Z employees saying they do not want the added pressures of management for low reward.

“The increasing complexity of management roles, especially in hybrid and remote environments, as well as inter-generational differences is making it more difficult to find people wanting to be managers,” said Peters.

Conclusion

New Zealand’s labour market crisis is a complex issue with far-reaching consequences. The country’s reliance on global talent pools and the growing demand for skills that are likely to be in short supply due to AI-driven technological advancements make it increasingly challenging for employers to attract and retain top talent. As the workforce continues to evolve, it is essential for employers to adopt dynamic hiring strategies, invest in continuous learning, and recognize the importance of soft skills and management candidates in driving long-term success.