Companies calculate the cost of worker shortages in Australia and New Zealand


The decision by Australia and New Zealand to close their borders to non-residents during the pandemic helped curb Covid-19, causing economic growth and corporate profits to exceed expectations.

But 15 months later, critics warned that these “Hermit State” Policy It is now causing major problems for companies, which are facing a growing shortage of skills, which leads to rising costs and falling output.

Many industries are advocating for the relaxation of border and visa regulations, although the highly contagious Delta Coronavirus has prompted authorities to tighten regulations to protect the largely unvaccinated public in both countries.

Australia’s booming agriculture and mining industries helped the economy escape its first recession in nearly 30 years, but it was the worst affected. In New Zealand, restaurants and cafes are facing such a severe shortage of employees, but they recently staged protests across the country to lobby the government to relax visa regulations for overseas workers.

Due to government stimulus measures and early economic reopening, unemployment rates in these two Pacific countries have fallen rapidly.

Australia’s unemployment rate hit a 10-year low of 4.9% in June, although the new crown pneumonia epidemic this month may cause the unemployment rate to rise. The unemployment rate in New Zealand is 4.7%.

Lachlan Dobson is one of the co-owners of Kimberley Produce, the largest banana producer in Western Australia. He is one of thousands of farmers because most of the 40,000 foreign backpackers and seasonal workers are working hard to recruit Staff Home.

“We made a difficult decision to dump some of our crops instead of letting it cause biosecurity issues, such as the flies,” said Dobson, who estimated the loss of agricultural products to be 1.4 million Australian dollars (US$1 million). ).

Australian farmers reported that since December last year, due to labor shortages, crop losses amounted to A$58.4 million. National Register of Crops Founded by the farm lobby group Growcom.

Western Australian miners stated that they may face a shortage of 40,000 workers in the next two years, threatening this industry that will contribute A$83 billion to the local economy in 2019-20.

Rio Tinto cited the coronavirus-related “restrictions on the movement of people and availability” as the cause Iron ore production is lower than expected In the three months ending at the end of June.

Earlier, BHP Billiton, Mineral Resources and gold miner Santa Barbara warned that skills shortages in Western Australia were raising costs and affecting production.

Paul Everingham, chief executive of the resources industry lobby group CME, said: “Due to Covid-19 restrictions, the situation that would have led to a labor contraction due to strong demand has become a squeeze.”

Everingham said that iron ore miners are picking up workers from gold miners at higher wages. He is lobbying the government to develop new visas for foreign workers and exploring ways to allow them to enter the country.

He warned that action needs to be taken to avoid the last mining boom experience in 2010-12, when wages and costs soared, but a depression soon followed.

Most analysts said that it is unlikely that Canberra will relax border rules in the near future, as the coronavirus lockdown has covered almost half of the country’s population after the outbreak in Sydney and Melbourne.

With 34,000 Australians stranded overseas, relaxing border restrictions on commerce is politically tricky. Last week, stricter flight limits were imposed on inbound passengers, which halved the number of passengers allowed to enter the country to just over 3,000 per week.

Health experts say that the Australian and New Zealand authorities cannot yet reopen the border because of the low Covid immunization rate, with only 10.8% and 11.7% of the population fully vaccinated, respectively.

The Australian Treasury Department predicts that international borders will not reopen until at least the middle of 2022.

At the same time, Canberra and Wellington are relaxing visa restrictions for foreign workers already working in their home countries to try to retain as many overseas workers as possible.

New Zealand has also launched a key workers program that enables 17,000 skilled employees to enter the country to support businesses.

But analysts say that before vaccination rates rise to levels close to where herd immunity is possible, companies may have to rely on declining local workers.

jamie.smyth@ft.com



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