Introduction

Since the 1980s, New Zealand, like Australia and Canada, has been progressively aligning immigration policy with policies designed to stimulate economic growth so that immigrant capital and entrepreneurship meet critical skill needs in the labour market. Unlike the other two countries, New Zealand does not have a federal system of government, and its associated sub-national structure for political and legislative authority allows for some decentralisation of immigration policy determination and implementation. While the central government in the three countries has retained firm control over immigration policy, there has been a trend in recent years in Australia and Canada towards increasing the power of the state/province legislatures to develop immigration and labour market policy initiatives designed to meet specific sub-national development initiatives. The absence of such a layer of legislative authority in New Zealand has meant that strategies to meet local development objectives have had to be implemented much more at the operational end of business development than through specific initiatives taken by regional governments. New Zealand does have a system of regional councils, but these do not have any devolved authority to pass legislation or implement policy that has distinctive local dimensions with regard to immigration and labour market dynamics.

In this paper, we review the changing context within which firm-based responses to increasing shortages of skilled and unskilled labour have been situated in the late twentieth and early twenty-first centuries. Several immigration policy initiatives have attempted to address increasing demands for labour in different parts of the country, but these have always been articulated as national policies rather than policies that have a specific regional focus. Three such initiatives are examined with reference to specific issues relating to labour market demand. These are the inclusion of a points bonus for immigrants who have received offers of employment outside of the Auckland region, the introduction of a “talent visa” and an associated approval in principle system that allows employers to essentially recruit the high-skilled labour they require, and the recently introduced Recognised Seasonal Employer (RSE) scheme, which is designed to assist employers in the horticultural and viticulture industries to meet major seasonal shortages in unskilled labour supply.

Three case studies of regional initiatives to meet local demand for labour are then discussed: Venture Southland’s scheme to attract immigrants under the established Skilled Migrant and Family Sponsorship streams to the country’s southern-most region that has been experiencing net migration losses for many years; the Waitakere Employment and Skills Project (WESP), which has sought to meet demand for labour in small and medium-sized businesses in one of the four local authorities (designated as cities) that make up the greater Auckland urban region; and the RSE policy that is seeking to assist employers of seasonal rural labour meet their demand for workers while at the same time contributing to good development outcomes for Pacific Island countries and their communities. The latter policy is modelled on a Canadian temporary work programme for rural employers using low-skilled labour from the Caribbean and Mexico. It is a policy initiative that is being watched closely by Australia’s immigration authorities; Australia has no migration policies that deliberately favour workers from particular parts of the world, and the greatest differences in immigration policies between the two countries can be found in the way they approach the entry of people from the neighbouring Pacific region (Bedford et al. 2006).

Labour Market Imperatives

Australia, Canada and New Zealand all typically seek to ensure that approximately two thirds of immigrants, selected under their broadly comparable points systems, are skilled and meet national labour and capital requirements (for a useful comparison of the skilled migration policies of the three countries, see Birrell et al. 2006, pp. 98–128). New Zealand has been the latecomer in terms of using a points system to select the required skills and capital, but governments since the late 1980s have adopted this approach with enthusiasm (Trlin 1997; Bedford et al. 2005a). It has been further promoted by forecasts that put annual labour demand growth at 1.4% between 2006 and 2016 but labour supply (encompassing population growth, retirements, changes in participation level and migration) at 0.8% (Barker and Baker 2006). The annual target of approximately 45,000 permanent migrants, which the Labour Government has maintained since 2000, has been increasingly supplemented by those on temporary work permits (100,000 in 2005/2006 compared with 34,000 in 1999/2000), both as a way of testing local suitability in the labour market as skilled workers and business entrepreneurs and in relation to short-term or seasonal labour market shortages (Department of Labour 2006).

This recruitment of skilled labour has been largely driven by national economic considerations, and the existing analyses of immigration policy have similarly stressed the national context. As Ellis (2006, p.49) has commented, this is “understandable inasmuch as immigration is first and foremost defined as a crossing of national borders by people to take up residence in new countries”. And the involvement of governments in business immigration programmes, for example, “…announces the state’s active participation in the global space of flows… [T]he state is at the center of the global process, negotiating new terms of engagement between capital and national jurisdictions” (Ley 2003, p.437). But just as states are engaged in recruiting human and economic capital and in establishing new global connections of various sorts, regions have begun to play an increasing and parallel role. In some instances, this role is promoted via national policy frameworks, such as the State Specific and Regional Migration policies in Australia and the Provincial Nominee programme in Canada (see papers by Hugo and Carter in this volume). As already noted, New Zealand does not have equivalent sub-national policies, but regions are seeking a much greater role in recruiting immigrants as part of their own economic development strategies (Bedford 2006).

New Zealand’s immigration policy was dramatically revised in 1986 (Burke 1986). Previously, policy had reflected the long-established cultural and economic links with the UK, and immigrant recruitment focussed on a mix of preferred source countries and the need to fill occupational shortages (Spoonley et al. 2003). The resulting dominance of British immigrants was first significantly reduced by the recruitment of semi- and unskilled labour from the Pacific from the 1960s (Gibson 1983). The major policy change in the mid-1980s was followed by a new Immigration Act (1997) and a shift in 1991 to immigrant selection via a points system that was neutral in terms of origin of migrants (Bedford et al. 2002). The result was a much more diversified flow of immigrants with significant arrival numbers from Hong Kong, Korea and Taiwan in the early 1990s and then from India and China after 2000 (Bedford and Lidgard 1997; Bedford et al. 2005b). The then conservative Prime Minister, Jim Bolger, also portrayed New Zealand’s geo-political interests through the 1990s as associated with Asia rather than with Europe, an important shift in terms of nationalist discourse and identity, as well as impacting on skill and capital recruitment, and external (trade) relations.

Not all were convinced by the “New Zealand is part of Asia” drive at the time, and the 1996 election heralded significant support for an anti-immigrant party, New Zealand First. The arrivals from Asia peaked in the same year, providing 59% of all immigrants (32,164 out of a total of 54,437 in 1995/1996), having risen from 17% of all permanent and long-term arrivals in 1986/1987. The racialisation of Asian immigrants in the mid-1990s by the media and some politicians occurred alongside a more positive orientation towards Asia and Asian immigrants by the political elite (Spoonley 2006). The racialisation of Asians was undermined by growing economic and, specifically, labour market imperatives.

New Zealand went through a radical re-orientation in economic policy in the 1980s and early 1990s, with the implementation of neo-liberal policies (see Kelsey 1995 for a critical review of this “economic restructuring”). The Labour Government hollowed out the state’s ownership of key parts of the economy and opened up previously controlled and protected parts in both the primary and secondary sectors to international competition and ownership. The subsequent National Government (elected in 1990) continued the radical restructuring with changes to the welfare state and the labour market. The latter involved a reduction in the extent of employment protection, union representation and the individualising of employment contracts. The National Government moved to a less radical position in the mid-1990s. But the combined effects of the changes had radically altered the nature of employment and employment relations.

Employment was less secure and became more typically non-standard. In the decade from 1991 to 2001, part-time employment increased by 100,000 (301,100 to 402,200), multiple job holders by just under 10,000 (64,900 to 73,400) and the self-employed by 77,000 (275,600 to 352,800; see Spoonley 2006). Contract and fixed-term employment grew significantly, and the effect was to externalise various employment-related costs as a way of lowering the cost of labour and increasing labour flexibility. The normative expectation that employment would largely be standard (involving salaried or waged employment in fixed hours during Monday to Friday and with an expectation of ongoing employment) was renegotiated during the 1990s. This had implications for what was to occur in the New Zealand labour market after 2000, notably the ability to match labour supply (including immigrants) to demand, especially given regional variations in that demand.

Key concerns in labour market management had been unemployment through the 1970s and 1980s, and then labour market regulation (effectively deregulation) in the 1990s. By the late 1990s, a very different policy concern had emerged: the lack of skilled labour. Labour market policy had been focussed on supply issues, notably training for the unemployed, the labour market position of groups such as Maori, Pacific migrants and their descendents, and gender differences in labour market engagement. The state was a key player as a major employer, as the principle investor in labour market training or as the regulator of labour market relations. As all three roles were diminished, employers began to play a more significant role and to articulate their concerns.

One issue became particularly important for increasing the numbers of employers, and that was labour shortages. An early indicator was the Department of Labour survey in May 2000, which found that 39% of businesses were finding it hard to obtain the skills they needed for expansion, and 12% of all businesses noted that the shortage in recruiting labour was their biggest constraint on growth (New Zealand Herald, 23 October 2002). Since 2000, these labour shortages have grown so that, by 2005, half of all businesses in New Zealand identified skill shortages as their most significant constraint on growth. There are two different issues here. One is that there are insufficient applicants for a particular position (skill shortages), while the second occurs when employers are able to recruit employees who have some but not all the required skills (skills gap). Both were major issues and common to all regions in New Zealand by 2005.

In 2002, research in Waitakere (one of Auckland’s four “cities”) contributed to a local shift in orientation for a key labour market policy agency, which in turn led to the establishment of the WESP (see below for further details). The shift was from labour market policies that focussed on supply considerations to a policy framework that privileged labour demand as the main factor. It was encouraged by the challenges faced by a distinct labour market within the main urban economy of Auckland when most policy interventions remained nationally driven or, at best, concerned with an urban economy but which did not consider the differentiated labour markets within that city economy. The issues were compounded by a lack of information on the nature of demand, the mismatching of supply and demand, particularly as a product of the inability of labour market brokers, such as employment agencies and schools’ career advisors, to understand the current labour market trends and requirements, and the lack of investment in appropriate education and training.

By 2004–2005, New Zealand employers began to articulate their concerns forcefully and to ask questions about the nature of policy and investment. Ironically, having argued for flexible labour supply and the transfer of costs from either the state (misspent tax dollars by an inefficient government) or employers (education and training is a personal investment that accrues benefits to that individual who, in turn, needs to be incentivised), employers now wanted the state to re-enter with labour market activation policies (but not employee protection) to guarantee supply or to argue for more geographically or industry-specific initiatives. In this context, two additional elements came into play: regional initiatives in matching supply and demand, and the role of immigrant labour and capital in contributing to regional economic growth. Before discussing how these two elements have emerged and the form that they have taken, it is necessary to indicate how sub-national considerations have been seen in relation to immigration.

Policy Silences

Regional economic development had been a feature of the Labour Government’s policy platform in the 1970s but had disappeared for most of the 1980s and 1990s (Le Heron and Pawson 1996). It was seen as part of the command and control economy at the opposite end of the spectrum from the radical neo-liberal economic restructuring that dominated over those decades. When the Labour Party was re-elected to government in November 1999, one of the minority coalition parties was led by Jim Anderton, a former Labour Party office holder and a traditionalist in terms of direct state involvement in economic development. As part of the agreement to align with the Labour Party in government, Anderton advocated for regional development through a new government agency, the Ministry of Economic Development. He was subsequently appointed Minister of Regional Development.

While regional development has not been a central priority for the labour-led coalition government since 2000, it has been part of the suite of economic development strategies it has supported under a growth and innovation framework that is driving the agenda for significant economic transformation in New Zealand. In the national policy context, regional development has not provided any particular focus for immigration policy. Regional development has been largely concerned with utilising local economic and human capital resources, while immigration policy concerns have been largely framed in a national context. This becomes apparent when the literature on the economic impacts and issues of immigration is surveyed.

Immigration has been seen as critical to New Zealand’s economic development in the last two decades but in particular ways. A Treasury report (see Moody 2006) titled “Migration and Economic Growth” views the issues through a national lens with key sections on labour utilisation, productivity, the fiscal impacts of migration and a range of policy issues (entry requirements, reducing barriers to employment, increasing the skills of migrants and emigration), with a very brief section on technology spillovers but with no consideration of what this might mean in a regional context. In a survey of research on immigration, the Workforce Group of the Department of Labour (2004) does not include any studies that specifically address regional issues or outcomes, while the very impressive longitudinal survey of immigrants (New Zealand Immigration Service 2004) provides an extensive data base that is immigrant-focussed (motives for migration, migration skills and resources, labour force integration, social integration and settlement). Again, there is little that might address regional concerns, although a broad sub-national analysis of the Longitudinal Immigration Survey, New Zealand (LisNZ) data will be possible when the first wave interview data becomes available for analysis (July 2008). Wallis (2005) does provide a brief section on migrant locations at the regional level.

Other research concerns the economic impact of immigration and the economic outcomes for immigrants. The latter is provided by two landmark studies (Winkelmann and Winkelmann 1998; Boyd 2003), although both are concerned with issues such as wage convergence and factors that single out immigrant success or failure. Poot and Cochrane (2005) surveyed the literature, both domestic and international, on similar issues but they broaden the focus. As they indicate, the economic impacts of migration tend to focus locally on such issues as the impact on wages and migrant adaptation. They raise the question of whether “…an influx of immigrant workers leads to an increase in the demand for labour in excess of the immigrant supply effect” and go on to observe:

The spatial concentration of the migrant could lead to higher chances of employment (e.g. by immigrant employers) but lower wages (in segmented labour markets). Despite the well documented geographical concentration of migrants in host countries, the research on the effect of such clustering on migrant’s labour market outcomes is still remarkably incomplete (Poot and Cochrane 2005, p.15).

Most of the attention is on the economic impacts of immigration in a national labour market or the economic integration pathways of immigrants. Later in the review, they indicate some topics of research and policy interest:

There are three ways in which immigration can lead to greater economic growth. These are (1) acceleration of convergence to the long-run steady state growth path through enhancing openness of the host economy and the increasing the demand for investment; (2) through promoting innovation and consequential long-run changes in total factor productivity; and (3) through improving allocative efficiency in the short run and long run, which again may boost total factor productivity (Poot and Cochrane 2005, p.22).

Poot and Cochrane highlight the need to explore the various impacts of immigration on economic growth, especially in relation to innovation and productivity. In summary, research and policy focussing on immigration has tended to ignore the spatial implications of immigrant economic integration. However, the imperatives and opportunities at a regional level have been shifting.

One immigration policy initiative that does have a very crude regional dimension is the allocation of points for having a job offer in a region other than Auckland. The amended version of the points system, introduced in February 2004, does have a small allocation of points—available to immigrants in the skilled migrant category, who had offers of work outside of the Auckland region at the time they applied for residence approval (Bedford 2006). Between February 2004 and July 2007, 59% of the 26,313 skilled migrants, with a job offer at the time of application and who were approved for residence, received the allocation of points for having a job outside of the Auckland region. The share that went to Auckland (41%) was lower than the public impression of immigrant concentration in that city, and it is quite a bit lower than the share of migrants that the Auckland region gains from international migration as measured in the national quinquennial censuses in New Zealand (Bedford et al. 2007).

At the time of the 2006 Census of Population and Dwellings, the Auckland region was home to 49% of the people who had been resident overseas in 2001 (including people born in New Zealand). If the New Zealand-born are removed from these “immigrants”, the share of new migrants in the Auckland region, who had been resident overseas in 2001, rises to 54%—well above the share that the region gained of the skilled migrants who had jobs on arrival in New Zealand between 2004 and 2007.

Two other immigration policy initiatives that have had a regional impact but were not specifically designed to meet the needs of particular regions were the talent visas introduced in 2002 and the RSE policy that has been fully implemented in 2007. These initiatives address opposite ends of the skill spectrum and both enable employers to register with the Department of Labour as approved recruiters of the labour that they demand. The talent visa system, modelled on a similar initiative in Australia around the same time, allows approved employers who want employees with specialist skills in a restricted number of occupations to seek out the people they wish to employ and to effectively grant them “approval in principle” to migrate to New Zealand (Bedford et al. 2005a). Those approved for entry via the talent visa process could transition to permanent residence after 2 years in the job in New Zealand. Employers in the regions with the main urban centres (Auckland, Wellington, Christchurch, Hamilton and Dunedin), especially those in the information technology and the biotechnology industries, have taken advantage of this scheme to bring into New Zealand highly skilled migrants.

The RSE policy has been designed to assist employers in the horticultural and viticulture industries to address a perennial problem of shortfalls in the seasonal supply of labour to harvest their crops and to undertake routine maintenance work on orchards and vineyards. The labour shortage problem in rural New Zealand has intensified in recent years as national unemployment levels have fallen to their lowest levels in 30 years. Farmers in those regions specialising in the production of fruit, vegetables and wine have been putting pressure on the Labour-led Government to adopt immigration policy settings that allow for entry of seasonal workers who can work continuously in the country for longer periods than are permitted under the Working Holiday Visa scheme.

After a particularly difficult season with regard to labour shortages over the summer of 2004/2005, the Department of Labour was permitted to pilot a Seasonal Work Permit for migrant workers in regions experiencing absolute labour shortages. This pilot was extended again in 2006 when a review of temporary work policy was undertaken as part of a wide-ranging Immigration Change Programme initiated in 2006 (Dunstan 2007). One outcome of the review has been to pilot and implement an on-going seasonal employment policy during 2007, and this is discussed further after a brief review of some of the ways changes in international migration and the nature of labour markets have impacted on regions.

Migration and the Regions: Some Issues and Challenges

One of the issues that regions confront, as do states, is that migrants rarely act in anticipated ways. If the historical model of an immigrant was someone who migrated from the other side of the globe to settle permanently in New Zealand, post-war developments began to change this behaviour if not the expectations of those who were part of the host society. Circular and temporary migration, even for those who were selected as permanent residents, has become increasingly common (Hugo 1999). This migratory behaviour has not been confined to immigrants; the New Zealand diaspora as a proportion of total population is one of the most significant in the OECD (2005). New Zealanders have become increasingly mobile as both temporary and permanent emigrants and new New Zealanders provide another layer of mobility to this picture.

The international recruitment of skilled migrants has provided migrants who adopt a variety of strategies and options from permanent settlement with little mobility through to transnational options seen in astronaut family behaviour to groups whose skills are in international demand and who constitute part of a cosmopolitan and internationally mobile workforce. New Zealand provides a limited labour market in terms of size, career advancement and diversity, and migrants along with New Zealand residents seek alternatives in much larger labour markets and cities. As Ley (2003 p.438) has observed, “[w]hile the state [has] sought economic development and the reproduction of national citizens, many newcomers [have] sought strategic flexibility” with transnational linkages and cross-border mobility and the exercise of flexible citizenship locally.

The de-industrialisation of local production, the variable experiences of primary production in competing on global commodity markets, the withdrawal of state-owned activities and the rise of new industries (notably tourism) have impacted differentially on regional economies in New Zealand. Local labour markets have been put under pressure by depopulation (in some regions), the limited supply of labour, especially appropriately skilled labour, and the (in)ability to recruit immigrant labour. Post the restructuring of the late 1980s and early 1990s, a number of regions experienced significant levels of human capital loss, business closures and underemployment (Le Heron and Pawson 1996). Since 2000, the success of some industries (e.g., tourism or dairying), a much more buoyant national economy and a recognition that, in the absence of direct or significant state intervention, local economic initiatives are required has led to many regions setting up and funding local economic development agencies (EDAs). The efforts of two of these EDAs will be examined shortly.

Almost without exception, immigrant labour and business have been identified as an important element in these economic promotion activities. This reflects an important shift in two ways: economic growth is a local responsibility—the state is still critically important as it sets regulations and economic investment priorities, and its spending power is considerable, but local market and business considerations have been given a new importance in a neo-liberal policy context. Secondly, the national effort to recruit immigrant labour and capital has now been paralleled by regional EDAs, with varying degrees of enthusiasm and success.

The regional efforts to interest immigrants in coming to their locality face a number of challenges. The first is that the New Zealand state effort has been, until recently, focussed on immigrant recruitment as opposed to settlement issues. One effect has been a product of the neo-liberal assumption that skilled/educated/experienced immigrants make appropriate decisions post-arrival and settle accordingly. The agency of immigrants has and continues to be privileged. This is a major challenge in terms of ensuring the regional dispersal of immigrants. Cosmopolitan migrants from large city economies in Asia and Europe are unlikely to be easily recruited to small cities or rural areas. The exception has been provided by seasonal labour—by definition, a response to regional labour shortages—and to some extent, the recruitment of international students by schools at the compulsory secondary level. But both options are short term and do not involve family migration, and the first is geared to very specific types of short-term labour shortages.

Furthermore, regional labour markets are thin. There are few large employers, businesses in a particular sector are small in number and upward mobility/promotion options are restricted, and while lifestyle aspects often provide a positive selling point, the economic opportunities are limited. Why would a skilled migrant be attracted to these areas, especially if the number of co-ethnics are few? The host community response might compound these issues. Newcomers will face racism and discrimination in many communities, irrespective of size, but in smaller regional communities, such experiences can be intensified.

Notwithstanding these well-known and long-established challenges facing those promoting immigration to rural areas and small regional urban centres, the first 7 years of the twenty-first century has seen an upsurge of interest in regional migration initiatives. In the next section, we review two of these—one in a region dominated by primary production (dairying, sheep farming and fishing), tourism and small towns; the other in New Zealand’s largest urban agglomeration in a “city” where small- and medium-sized businesses dominate the economy.

Southland and Waitakere: Regional Initiatives in Recruiting Immigrant Labour

Since 2000, regional initiatives led by EDAs and local authorities have sought to attract immigrants to their area to fill labour shortages and to contribute to economic development generally. These initiatives have been encouraged by a sustained period of economic growth in New Zealand since the turn of the century and a shift towards a more active policy to encourage good settlement outcomes for migrants. The two case studies in this section provide an indication of the sorts of strategies that regional economic development agencies have adopted to attract and retain migrants in a constrained labour market.

Southland

One of the first regions to implement a local immigration “policy” was Southland, New Zealand’s southern-most region with a population in 2006 of 91,000, just over half of whom were residing in the main town of Invercargill (46,800). Of the total population, 3.5% or 3,140 had been living overseas in 2001, and 1,680 (53%) of these people were living in Invercargill in 2006. The “immigrants” to Southland, including 1,236 New Zealand-born (39% of those who had been living overseas in 2001), were distributed between the main urban area and the rest of the region in roughly the same proportions as the total resident population. There was a higher number of immigrants into Southland than recorded at previous censuses, and this reflects a combination of factors, including the efforts by Venture Southland to encourage immigration to the region.

Venture Southland (http://www.venturesouthland.co.nz), an economic development agency established in 2000, undertook two major inquiries into the region’s employment situation in November 2001 and September 2003. There was a growing concern about regional skill shortages, and in the 2001 study of economic growth and employment in Southland, it was established that 84% of the 620 businesses surveyed “stated that a major barrier to increasing employee numbers was due to lack of suitably skilled/qualified applicants” (Venture Southland 2005, p. 1). It was noted that tourism and agriculture were the two sectors most likely to recruit labour outside the region. Venture Southland (2005, p. 1) went on to observe that “it was largely in response to this situation that the Southland Needs You campaign was launched” (http://www.moveto.southlandnz.com).

A combination of events added impetus to the Southland Needs You campaign: the onset of a boom in prices for dairy produce and the conversion of significant areas of agricultural land in the South Island to dairy farming; the decision by a local Trust to carry the costs of fees charged to students by the local Polytechnic, making it the first and, for a while, the only tertiary institution in the country to offer a “free” education to students; the changed security environment internationally after September 11, 2001; and the appointment of a Mayor and some local officials, including recent immigrants, with a passion to promote the region nationally and internationally.

Through the early 2000s, the Southland Needs You campaign was promoted at New Zealand’s Opportunities Expos in the UK. Initially Southland did very well, according to one of the key players, Matt Hoskin (personal communication, January 2007)—they led the regions in developing a presence at the Expos and capitalised on the heightened sense of insecurity in the UK, especially following the onset of the “war on terror”. While Southland could not claim to have major opportunities for migrants in a dynamic urban economy, what it could do was promote a particular quality of life and a supportive local network to assist new immigrants to adjust to life in a new country.

Venture Southland probably went further than most EDAs in developing an active recruitment programme for international migrants. Following a further survey of employers in September 2003 (Employment and Training Needs for Southland), where it was established that over 25% of the 747 employers that responded had vacancies within their organisations, Venture Southland in association with the Southland Chamber of Commerce and Engineering South, made submissions to the New Zealand Immigration Service to add several skilled occupations to the Immediate Skill Shortage List and the Long-Term Skill Shortages List. These skill shortages in Southland included several trades, numerous engineering and construction occupations, haulage drivers, health care workers, farm managers and a wide range of professional services and clerical roles. These were not just in the “high-skilled” categories; there were labour shortages in the lower skilled job market as well, and Venture Southland (2005, p. 4) felt that “whilst there has been a number of public and private initiatives to address the problem, it is unlikely, given continued economic growth and development [in the region] that these shortages are likely to abate over the short to medium term”.

In 2004, as the competition between regions for international migrants intensified, and the New Zealand Immigration Service developed strategies for promoting better settlement outcomes by assisting migrants to integrate more easily and quickly into their chosen New Zealand community, Venture Southland developed a comprehensive set of employer settlement advice guidelines (Venture Southland 2004). A particular concern was to ensure that prospective migrants were provided with a realistic and honest assessment of life in New Zealand at seminars and events such as the NZ Opportunities Expos. A difficulty in New Zealand, according to Hoskin, is establishing a true point of difference between regions other than the major metropolitan ones. He saw little point in arguing that one region was necessarily “better” than another; the key thing to recognise was that migration is not just about jobs but rather is a highly emotional experience, and all sorts of expectations have to be met. Appropriate settlement services, including a welcoming community, are essential for good settlement outcomes, including those for the migrants from traditional source areas such as the UK. A critical “point of difference” between regions can be in the nature of the welcome and the support provided for migrants as they settle into their new community. It is this settlement experience that Venture Southland has been emphasising in its efforts to encourage immigration to a region that is generally perceived in New Zealand to be one that loses rather than gains migrants.

Waitakere

Auckland, a city of 1.25 million people and the gateway city for the bulk of immigrants, is made up of four local territorial authorities, one of which is Waitakere City. It might seem anomalous to include such an example in case studies on the regional recruitment of immigrants. But there are two reasons for doing this. The first is that Waitakere has experimented, often successfully, with policy development and implementation. Secondly, it constitutes a distinctive labour market that is marked by certain characteristics: a large daily migration with half of all resident workers working outside the city; a dominance of small and medium enterprises (SMEs)—87% of firms employ less than 10 people; and significant skill shortages, especially in some headline, economically critical industries. To address these issues − and immigrant recruitment − WESP was established.

The impetus for this project grew out of the Local Employment Committee for Waitakere, which was funded by a government department, Work and Income New Zealand, and which brought together a number of local agencies, including the Waitakere City Council, Skills New Zealand/Tertiary Education Commission and Enterprise Waitakere. A report on seven local industries and their skill needs and future demands was commissioned, and this appeared in the first part of 2002. A working party was then convened, and as the report was disassembled for what it could contribute to an understanding of local labour market needs, a collective decision was made to acknowledge the largely unrecognised issues faced by local industries and employers.

At this point, a shift to a focus on demand-side factors was made, and a number of key concerns flowed from this emphasis: the issue of whether training and education providers were meeting employer and industry requirements; the role of intermediaries, notably government agencies, in helping employers as opposed to job seekers, or how best to combine both; the generic and tacit skills available to employers and the role of educational institutions in providing these; the information available on local demand, currently and in the future; and the information that was available to the key players in ways that maximised successful outcomes for everyone. The initial focus was on school-to-work transitions, but this was followed by a growing recognition that external labour supply in the form of immigrants—both skilled and unskilled—was also very important. What was to emerge was that, in privileging demand via more significant employer engagement, the attitude of many employers towards immigrant job applicants and employees would become an important issue (as it was for school-leavers).

It is worth highlighting one particular challenge in this project. Small- and medium-sized businesses provide more than 80% of the employment in Waitakere, and they have been cast as the “powerhouse” of the economy, given their growth and significance in recent years (New Zealand Herald, 23 October 2002). Furthermore, in 2002, 42% of SMEs identified skills-related issues as their major constraint to growth. These SMEs present some particular issues in developing appropriate labour market policies, especially in relation to immigrant labour recruitment and employment. They are not normally well represented in industry and sector representative groupings nor are they receptive to innovation, in this case, in recruiting and utilising immigrant labour. They proved to be particularly unresponsive. In some cases, they were expressly hostile.

There are several reasons for this: they tend to employ staff who can carry out a range of tasks, and there was not an easy fit with skilled and often specialised immigrant workers; their operating and profit margins are typically very low, and they are unwilling to provide opportunities for new settlers to gain local experience or to tolerate poor labour productivity because of the impact on profit margins; SME operators are equally intolerant of non-English speakers, partly because of the perceived impact on profitability (in the case of customer or client-sensitive businesses) and partly because of a lack of sympathy for a cultural or linguistic “other”; and many did not see immigrants, especially non-European, as important client or customer communities. Even though immigrant labour became defined as critical for economic performance at the regional level, this was not shared by many who occupy the SME sector in this locality.

WESP focussed on three particular clusters of activities. The first was understanding what was happening in the local labour market. Information on the changes in demand locally and employer expectations are now the subject of ongoing annual employer surveys. The aim has been to establish a data base that tracks local labour market trends and provides the evidence base for refining the goals and actions of WESP. There is still an ongoing issue with SMEs in such research (SME participation is poor and information is variable) but it does provide locally relevant information that constitutes an information platform rather than relying on relatively crude national labour market data base information or anecdotes. The second is to improve information in both directions: ensuring that job seekers, including immigrants, understand what employers and industries are looking for, and in getting employers to understand supply issues and challenges (what makes them an attractive employer to immigrants, providing opportunities to talk directly to immigrant job seekers). Increasingly, these matching and information activities are occurring offshore as Waitakere Enterprise (the local EDA) visits China and Europe (2007) to recruit businesses and immigrant workers. And third is to reduce the risks attached to employing immigrants by a variety of measures: pre-employment language instruction; advice on the local business environment and getting immigrants job ready, providing an initial subsidy to employers to encourage them to take on immigrant workers, work experience opportunities that allow employer and immigrant to appreciate options (although the most successful scheme of this sort involves school leavers), and ensuring that immigrant voices and concerns are heard in an economic promotion context. These activities are provided by a range of agencies not simply Waitakere Enterprise, but WE and WESP have played an important role in encouraging policy innovation and economic development (see http://www.waitakereenterprise.co.nz/).

The approach adopted by WESP is hardly unique, and its elements echo both national and other regional assessments and strategies, such as those adopted by Venture Southland. The employer concern with generic skills and personal traits, including those associated with immigrants, especially English language competence, has been apparent for some time, and it receives a regular airing in research on employment. Similarly, the shortage of skilled labour has characterised the New Zealand labour market generally. But there are some differences to the WESP approach. It was constructed as a response to a regional labour market that had a particular mix of industries, a significant commuter population, a large and growing immigrant population and a considerable number of small- and medium-sized enterprises. There are few large employers in the labour market, and the largest tend to be public sector services (hospital, city council).

In relation to WESP, what was significant was high-level participation from key government—local and national—agencies and industry organisations. The impact of this was apparent in the public profile of WESP, the ability to fund initiatives from within WESP and to get key people and agencies to support the programme at key points. The ability to deliver on various initiatives encouraged employers and industries to engage, and this was a significant challenge in relation to immigrant labour as far as many individual employers were concerned.

The limitations of what has been achieved result from a range of local and national factors. Comment has already been made of the difficulty in getting SME engagement, especially in relation to immigrants, and this remains an ongoing concern. WESP has been primarily (although not exclusively) focussed on the transition from school or training/education provider into the labour market with some success (an informational DVD, a work experience scheme for secondary pupils), and now the attention and resourcing is increasingly focussed on immigrant labour. Immigrants, both symbolically (the promotion of Waitakere as an ethnically diverse city) and practically (as a source of labour and new businesses), are now as much part of the economic development discourse in Waitakere as they are in Southland.

Seasonal Employment and the Development of the RSE Scheme

One important mechanism in the regional distribution of immigrant labour is provided by temporary work visas, notably in relation to seasonal labour requirements in industries such as horticulture and viticulture. In 2007, five areas—Central Otago, Hawkes Bay, Marlborough, Nelson and Waikato—were the “declared regions” with significant labour shortages in horticulture and viticultural industries. Nelson, for example, requires about 4,500 pickers for horticulture, and local supply is insufficient to meet anything like this number. In 2005/2006 (to June), just under 100,000 people were approved for temporary work permits, significantly up from 34,000 in 1999/2000. Part of the increase was a product of an expansion (in 2005) in the working holiday schemes, with countries such as Thailand and Norway entering, and a lifting of the caps on the number who could come via such schemes from the UK, Germany, Sweden and The Netherlands. Other temporary work permits were issued for specific events or purposes such as film production or sports. The effect of the temporary work initiative is that, for every approval for an immigrant to become a permanent resident, two gained temporary residence approvals. Subject to filling certain conditions, those on many types of temporary work permit can apply for permanent residence.

The less attractive side has been the activities of labour organisers who have arranged illegal workers for orchards and vineyards in Hawkes Bay. A 2007 estimate put the number of such workers at 20,000, and considerable effort is required to monitor temporary labour, prosecuting those who organise workers and deporting the workers themselves (New Zealand Herald, 17 April 2007). Partly in response to concerns over the rapid growth in illegal employment of visitors to New Zealand (who were not on recognised work permits) as the labour market for migrants with low levels of professional and technical skills became tighter, the Labour Government agreed that the Department of Labour could pilot a Seasonal Work Permit (SWP) for migrant workers in regions experiencing absolute labour shortages. The SWP pilot policy was launched in December 2005 and subsequently extended twice due to employer demand to run through to September 2007.

As part of a comprehensive review of immigration policy that commenced in 2005 (the Immigration Change Programme, http://www.beehive.govt.nz), seasonal work policies were reviewed at an early stage because of pressure for a more permanent solution to labour shortages in the horticulture and viticulture industries. Co-incidental with this review was increasing pressure from the governments of Pacific Island states for greater access to work opportunities, especially for low-skilled workers, in New Zealand and Australia. Labour mobility featured prominently at the annual meetings of leaders of the Pacific Forum countries in 2004 and 2005, and access to opportunities for temporary labour was becoming an important component of the discussions around the Pacific Plan for increased regional co-operation. Pacific governments perceived Australia and New Zealand as having labour shortages in low-skilled occupations that were largely filled by workers from other countries.

The RSE policy emerged from the review of several seasonal immigration policies in operation in New Zealand—the Seasonal Work Permit Pilot (SWP, the Approval in Principle process, the Variation of Conditions arrangement and the Working Holiday Scheme)—and an evaluation of international approaches to seasonal labour needs. In 2006, the World Bank published a comprehensive review of employment in the Pacific in the contexts of population growth, labour mobility and the demand for low-skilled labour in New Zealand and Australia (Luthria et al. 2006). The authors of this report encouraged the latter to give serious consideration to a well-managed seasonal work scheme for workers from the Pacific Islands—a recommendation that New Zealand has picked up through the RSE policy but which the Australian government, to date, has chosen not to adopt.

The RSE was piloted in the 2006/2007 harvesting and packing season in Central Otago, and was introduced fully in September 2007. Up to 5,000 temporary workers from the Pacific countries can be employed at any one time under the policy by employers that meet the accreditation conditions. Applicants for RSE status have to provide evidence of good workplace practices, a credible record in the industry and the ability to pay workers their entitlements at rates that equal those paid to equivalent workers from New Zealand. Before they obtain agreements to recruit, they must lodge their employee vacancies with the Ministry of Social Development (MSD) so that a determination can be made as to whether their labour requirements could be met by New Zealanders. Once employers have MSD approval to recruit, then they must turn first to eligible Pacific nations for the required labour unless they have established overseas recruiting relationships in other countries.

The RSE is a carefully crafted policy initiative that is designed to ensure that New Zealanders are the first choice for employers; the horticulture and viticulture industries are facilitated in obtaining the labour that they require to plant, maintain, harvest and pack crops; a contribution is made to development in Pacific countries; risks of overstaying and other immigration-related concerns are managed; and labour productivity in the industry increases. It is a very ambitious policy initiative that is being watched closely by Australia, especially now that there has been a change in government in November 2007 and the possibility of a new approach to some of the development issues in the Pacific.

It is too early to comment on the success or otherwise of the RSE in ameliorating New Zealand’s seasonal labour demand in the horticulture and viticulture industries in various ways. In December 2007, employers in several regions were complaining of on-going shortages of labour and seeking approval from the Department of Labour to extend the period that visitors on the Working Holiday Scheme can work while in New Zealand. The demand for Pacific labour under the scheme already exceeds the limit of 5,000. This employment policy will have some far-reaching effects on low-skilled employment in the regions with major horticulture and viticulture industries, as well as on the communities in those regions.

Options in Labour Recruitment for Regions

If demand issues are to be given more serious consideration, and immigrants are to be successfully recruited, then there are a number of aspects of local policy development and implementation that the current case studies suggest need more attention. The first of these is a nuanced and ongoing understanding of demand at a regional labour market level. There are supply characteristics associated with the stock of skills available (see Wilson 1995, pp. 28–29), which need to be carefully monitored, including the age structure of the workforce, occupational mobility and migration (both emigration as well as immigration), but this needs to put alongside the information provided by detailed employer surveys. Immigrants report that they have been provided with poor information about employer and industry requirements at various points in the immigration and settlement process.

The next issue is how to encourage better information flows, especially between employer and industry groups and various education/training providers, as well as those agencies that mediate in the labour market and who support immigrant workers. The communication links and information flows between employers, job seekers, especially immigrant, and labour market intermediaries is still poorly understood in New Zealand, especially given the pre-eminence of SMEs. The improvement of these information flows has been hindered by the reluctance of some employers and industries, and SMEs in particular, to consider immigrants as a desirable labour option.

It was realised through the WESP project that better and more targeted information was insufficient; rather, employers needed to be incentivised to establish some sort of job-related contact. Short-term placements proved to be moderately successful in that immigrants had an opportunity to gain New Zealand work experience and to acclimatise to a particular workplace while employers got a better (and often more sympathetic) understanding of the challenges faced by immigrants and what they could contribute to the operations of a firm. Accent and surname discrimination and a suspicion of overseas qualifications and experience were modified. Other options were also explored. It was found that paying for driving lessons and sitting a driving test provided functional English, mobility, confidence and a highly relevant job requirement. This was in preference, in some cases, to funding an English language or pre-employment course.

Another aspect is the importance of informal networks and information flows in opposition to structured, institutionally driven communication. This presented a particular challenge for immigrants in general, as well as in relation to regional destinations. Their lack of local social capital networks tended to exclude them from information sharing and recommendations about jobs. If networks did exist, they tended to be based around co-ethnic links, and while these were not irrelevant, they were often circumscribed in regions and most extensive in gateway cities. Part of the response is to provide information in relevant languages, particularly on appropriate websites. Another was to expand local networks.

Community agencies involved in English-language instruction are particularly good at providing local knowledge and personal contacts, but these typically do not involve employers or industries. Mentoring and industry initiatives, especially involving some Industry Training Organisations (government mandated agencies to link education and training with particular industries), the Chamber of Commerce and the Employers and Manufacturers Association, have tried to address the combined issues of a lack of local networks and New Zealand employment experience. Another is the need for regional industries to communicate their particular needs, as well as the employment attractiveness of their sector, to immigrants, both before arrival and as local residents. Research indicates some major concerns at the advice available to immigrants as job seekers.

There are important aspects of employer behaviour that need to be understood and perhaps modified, especially in terms of understanding their own (at an organisational or industry level) requirements and processes but also in relation to a changing labour market, especially in relation to the proportion of the working age population that is overseas-born. While employers have reason for concern at the language competency and New Zealand-relevant experience of immigrants, the issue is compounded by negative attitudes and discriminatory practices. Given the number of employers experiencing problems in relation to recruiting appropriately skilled people and their attitudes to immigrant labour, one question is whether employer understanding of the labour market and their recruitment and retention policies are the most effective or efficient. If there are recruitment problems, are the resources available within their organisation or industry the best available, especially in a regional context? Is there a need to alter behaviour (Hogarth et al. 2003)?

The question of easing transitions for various groups is a major concern, given that there is often under-utilised human resources in groups from youth through to immigrants and older workers, as well as potential Maori and Pacific employees. The changing nature of labour market activity, especially the decline of careers and long-term employment, requires new ways of ensuring that there are opportunities to successfully transition into employment and between various forms of employment. Associated with the WESP is a pilot that looks to improve the transition from school into “quality employment” funded by the Ministry of Economic Development. Similar schemes are required for immigrants as human capital under-utilisation is simply inefficient, especially given the limited human capital available in regions.

Finally, there is the question of what schemes might best help employers. One shift that is obvious in both the WESP and the RSE is the need to provide support for employers as opposed to primarily supporting the immigrant job seeker. Incentives and help are provided to reduce the risk for employers and to enhance positive employment outcomes. Another is the question of ongoing training, especially “learning on the job” (Blakey 2002: New Zealand Herald, 23 October 2002). There has been a considerable displacement of the responsibility for skill development and life-long learning to employees. For a recent arrival, the need to invest in education and training before full labour market engagement is a daunting barrier. The advantages of programmes to retain and develop immigrant employees requires some encouragement, although again, there are significant issues with SMEs who struggle to provide such options given limited resources. This is a major policy challenge if skills stocks are to be maintained through the regional recruitment of immigrant labour.

Conclusion

A less regulated labour market, along with new forms of labour flexibility and mobility have been paralleled by the shift to seeing immigration as a critical factor in contributing to, or more often, a major driver of economic growth in regions. But migration has itself become more flexible, ranging from schemes that seek to use labour on a temporary basis through to the approach adopted by skilled and network-rich immigrants who themselves are looking to maximise their economic and social well-being by exercising options, both locally and internationally. While the state has been the traditional driver in these changes—in the New Zealand case, as the key agency in international skill recruitment, in attempting to regulate entry and settlement behaviour and managing immigrant–host relations in various ways—regions, industries and employers have come to play an increasingly important role.

The state is far from having been displaced, but there is a logic in attempting to encourage economic development and labour market skills by agencies and individuals who are closest to that local labour market. However, in seeking to recruit and retain immigrant skills at a regional level—the main focus here—regional players are discovering that they face the same challenges as the state: skilled immigrants are themselves seeking flexible options, and the challenge is to attract them to regional centres, with typically low numbers of co-ethnics and relatively thin labour markets, and to retain them. If regions such as Southland, for example, are to retain their immigrants, it is often because of lifestyle factors rather than economic opportunities.

This paper has examined the way some regions have utilised immigrant labour to respond to labour shortages and to drive economic development at a regional level. The emphasis is on the front-end processes of recruitment. But there are a series of other research and policy issues that also require consideration. Poot and Cochrane (2005, p. 22) noted that there is little information available on the impact of immigration on issues such as innovation and productivity. Their comments were directed at the national economy, but the same can be said of local labour markets and regional economies. Are the dynamics and outcomes at this local and often non-metropolitan level different or the same as those likely in large urban (gateway) locations and the national economy? A multi-regional analysis that attempts to answer these questions would provide a much more nuanced and potentially beneficial indication of the impact of immigration across New Zealand. It might help answer questions about whether the economic impact of immigration has benefits that justify the capital spend and hope that has been invested in immigrant recruitment for regions.