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What does 2014 hold for NZ?

Happy New Year to all our regular Southern Man Letters from New Zealand readers. The team is back in the office, tanned and relaxed (that lasted about two days!) and looking forward to an extra busy year. For us it is going to be a year of firsts – we ...

Iain

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What does 2014 hold for NZ?

Happy New Year to all our regular Southern Man Letters from New Zealand readers. The team is back in the office, tanned and relaxed (that lasted about two days!) and looking forward to an extra busy year. For us it is going to be a year of firsts – we ...

Iain

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What does 2014 hold for NZ?

Posted by Iain on Jan. 17, 2014, 11:43 a.m. in New Zealand Economy

Happy New Year to all our regular Southern Man Letters from New Zealand readers.

The team is back in the office, tanned and relaxed (that lasted about two days!) and looking forward to an extra busy year. For us it is going to be a year of firsts – we are now dipping our toes in the Hong Kong and Indonesian markets. Across the Tasman Sea our Australian colleagues are heading to Botswana, Greece and Turkey to test the migrant waters there.

And what of New Zealand in 2014? How are the tea leaves looking?

If you can believe the various surveyors and economic forecasters we are in for a very good year and several beyond this. A few key points in recently released surveys show:

  • Business confidence is at a 20 year high
  • All sectors of the economy are growing – manufacturing, agriculture, services and tourism are all showing strong growth
  • All regions of New Zealand are in positive growth and confidence territory (spreading out from Auckland and Christchurch which dominated 2013)
  • ‘Own business’ confidence is running at multi year highs and this suggests GDP growth of at least 3.5% this year
  • Retail sales through Christmas were up 7% on the year before and have continued through the early part of January
  • Skills shortages are starting to bite (told you!!!!) - especially in the construction and IT sectors – everyone from Architects, Civil Engineers, Quantity Surveyors and Planners through to related trades workers. In ICT some are now calling the shortages ‘dire’ which might be a slight exaggeration but these shortages are going to be biting across most sectors within the next six months in my view .
  • Unemployment which currently stands at 6.2% is predicted to fall to 5.5% by years end and 4.5% by the end of 2015. It is worth noting that once unemployment gets down to 5% in New Zealand you’ll not be able to find a Secretary to do your word processing……or find someone to make you a cup of coffee. It is also worth reminding readers that skilled migrants seldom compete with the unemployed 6.2% - they tend to be un-skilled or semi-skilled.
  • Inflation is expected to remain subdued overall at around 1% but dog with rabies crazy in housing. There continues to be a chronic shortage of new housing supply meaning house values  are expected to continue their seemingly relentless increase by around 10% this year (higher in Auckland and Christchurch). This is feeding through into higher rental prices also.
  • Interest rates are predicted to increase by 25 base points each quarter for the next 5 quarters (starting March). The word is the economy is robust enough with exports booming even with a high exchange rate to offset any inflationary build up. I’d be expecting floating mortgage rates to be around 6.5% - 7% by years end.

Short of any major external shocks things are looking overwhelmingly positive. No one is talking about an overheating economy or boom times but there is a real and broad based momentum that has been building across all sectors and all regions.

This, I suspect, will embolden the New Zealand Government to continue with high skilled migrant pass marks and forcing a majority (note, not all….) of would be migrants to come and find jobs in order to have certainty of residency approval.

Those employers unwilling to recruit form the ranks of those offshore or who refuse to travel overseas to interview and recruit are within the next few months going to be staring into a very shallow pool of local talent. This will have an upward movement on incomes (we are already seeing it in construction and IT in particular).

While no one who reads this who thinks they may make a move this year should take getting work for granted, there is no doubt that 2014 for the vast majority of you will be a year of greater employment opportunities. Through 2013 we saw average times for most clients to find jobs here get down to a few weeks rather than a few months as it was through 2011-2012. If you are fluent in English, skilled, do your research on demand in the labour market for your skills set and are willing to get on a plane and get here, chances are you’ll find work within 4-6 weeks.

As we reported in December the Government has closed the Long Term Business Visa or self-employed pathway to residence while they think about a new ‘improved’ visa class for Entrepreneurs which they hope to launch in April. We have been offered an outline of the new criteria which we have agreed will remain confidential but what we can say without breaking those confidences is that the new criteria is less a pathway for the self-employed to demonstrate financial self-sufficiency to a move to focus on greater job creation and export related businesses as priority for approval. For the first time the amount of funds invested comes with a minimum and the more invested the higher the chances of success. In essence what we will gain is effectively a new sub-class of Investor – lower investment thresholds than those who apply to many looking to secure residence under the Investor Categories but a much higher threshold than historically in place for the self-employed. As always there will be winners and there will be losers.

Skilled Migrant Category also underwent its standard three year review during 2013 and I expect we may see changes this year. My own view is the changes will be minor (why change a formula that appears to be working?). My only two suggestions to Government were that we should be more prescriptive in regard to English language as the Australians are (better your English the higher your points) and I would also be re-instating points for those with capital they can transfer to New Zealand. Although it is proven that those with more money find it easier to settle I cannot see the Government taking me up on this suggestion; they might on the English language however. We shall see.

I head overseas today for the first round of seminars for 2014 and will be in Singapore this weekend, Jakarta next weekend and Kuala Lumpur the following. The seminar in Jakarta is now fully booked.

My colleague Paul will also be in South Africa in early February kicking for our first round of seminars there.

It is going to be a big, exciting and nerve wracking year for some of you as you pack up and join us here in New Zealand. For some 2013 was the moving year and 2014 will become the year of return to some sort of normality. For others 2014 will be the year of the ‘big decision’ to migrate or not. Wherever you are on that spectrum the Immagine team and I wish you every happiness and success for the year.

Until next week

Iain MacLeod

Southern Man – Letter from New Zealand

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6 comments on this post
Jan. 29, 2014, 10:25 p.m. by Alpha1

"It is also worth reminding readers that skilled migrants seldom compete with the unemployed 6.2% - they tend to be un-skilled or semi-skilled."

Complete garbage. Go to any supermarket, gas station, convenience store etc etc and see 'skilled immigrants' taking jobs from unemployed NZers. You're part of the immigration industry making money out of selling NZ residency.

Replies to this comment

Jan. 30, 2014, 2:38 a.m. by iain macleod
I've never yet met a NZ employer who'd employ a migrant over a local for any position. It's part of the challenge all migrants face in breaking into the local labour market. None of the migrants you allude to in your comment will have got their residence by getting the jobs you quote. They cannot - skilled migrants (which is what I was talking about) need highly skilled jobs in order to secure residence in NZ. No one pumping gas or stacking shelves in supermarkets got their residence that way because those jobs are not skilled. They will usually be international students who are allowed to work 20 hours per week while studying (and spending big money with local institutions for the pleasure), on graduate job search visas and looking for residency (but they won't get it with those sorts of jobs) or spouses/partners of permanent resident visa holders. At that point they are just like you and me and just as entitled to work as you or me. It is also worth repeating I have yet to meet a NZ employer who will offer a non-resident a job if there are locals available - mostly they cannot be bothered with the hassle of visas, dealing with the immigration department, etc. Before you accuse me of spouting garbage it might help to get your facts straight. An ignorant and uniformed opinion is different from a fact.
Jan. 30, 2014, 3:23 p.m. by iain macleod
Interesting perhaps since my reply to Alpha1 to quote Geoff Cooper - Auckland City's Chief Economist who in his latest economic outlook for Auckland in 2014 released overnight states: '..... job vacancies are on the rise and businesses are increasingly reporting difficulties in sourcing both skilled and unskilled workers. Labour turnover is also on the rise which suggests that employees are more confident about switching jobs.'
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Feb. 4, 2014, 1:43 p.m. by iain macleod

Message to Brent. If you are going to get abusive and use foul language I will indeed continue to delete your comments. If you have something intelligent to say and you'd like to offer a few facts to support your position then your comments will be welcome. Until then I will continue to delete your comments. I have no issue with people disagreeing with what I write as is evidenced all through this blog space - there are plenty of dessenting opinions that I leave up in the interest of varied (even if at times depressingly and uninformed) debate. I encourage that. However when you are rude, abusive and just plain wrong you add nothing to the discussion. So do yourself a favour and not waste your time venting here unless you have a few facts to support your otherwise factually incorrect outbursts.

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Feb. 5, 2014, 12:45 p.m. by iain macleod
5 Feb 2014 - NZ Herald in reporting independent unemployment figures showing it falls to a four year low of 6%: 'The figures come as surveys last month showed signs of an improving labour market, with gains in employment confidence and firms finding it harder to hire find skilled and unskilled workers. The Reserve Bank is keeping tabs on capacity pressure that may emerge as the Canterbury rebuild and Auckland housing suck up resources, which may spill over into broader inflation if wages rise, and lead to higher consumer prices. Unemployment in Auckland fell to 6.3 per cent in December from 6.7 per cent, while Canterbury's jobless dropped to 3.4 per cent from 4.2 per cent. The number of construction workers rose to 185,800 in the quarter from 177,800 in the third quarter, and manufacturing jobs increased to 254,000 from 247,900. Retail, accommodation and hospitality employees increased to 363,100 from 356,200. Agriculture, fishing and forestry employees increased to 149,500 from 138,700.' Might explain why about 98% of all my skilled, fluent English speaking clients seem capable of getting skilled employment and moving onto secure their residence.
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Feb. 14, 2014, 11:43 p.m. by Mark

IT Specialist:
Before coming here – I was told for 6years what a great place this was!
As a high end IT and Corporate Governance Pro with 24 years experience, and after being told for 6 years of research that I would be welcome in NZ, I packed up & came here.
After almost 3 years, and being unemployed for the last 16 months, and having lost everything in the world – I must admit that I have failed completely.

This has been the single greatest tragedy of my life.
One of many examples: The Electrical Commission (a ministry of government) told a friend of mine that they had just hired (a German), that “we would tolerate a German – but we would NEVER hire an American.” At the time they had 97 jobs open that they could NOT fill with kiwis.
I have been told that the reasons I cannot have a job in New Zealand is:

“You are too over qualified” (this should be the national anthem of New Zealand – as every foreigner I know has heard this over and over again). “You are a foreigner – we would never hire a foreigner”. “You are an American – we would never hire an American.”
As for being friendly – I have not had one date with a woman since I arrived here. I have been told repeatedly, and with no hint of regard or regret that: “Yes, we’re kiwi women, we hate American men!”

Corporate management in NZ is directly out from “kindergarten school yard” – I was black listed after two newspaper articles came out on me, asking “why can’t this IT Whiz find a job?”
Gen-i (Telecom) hired me immediately – only to fire me five months later.

I have been told time and time again that Kiwis: “hate, loath, despise, and fear” foreigners – and the higher your level of professional background is the less likely you will every get a job here.
I came here by myself, so I feel so very sorry for the families that came here, believing in that lie of a “quality of life”. There is no “quality of life” here – not even for the kiwis themselves.

Replies to this comment

Feb. 15, 2014, 12:20 a.m. by Paul Janssen
Hi Mark, I have to say that your comments seem so far off the wall to what my clients and indeed my entire social network in New Zealand would tell me. Sure, particular migrants don't succeed in NZ for a variety of reasons but in many cases its because they are ill prepared and have unrealistic expectations. New Zealand is a different country, its not the same as the place of origin (wherever that may be) but to assume that all employers treat migrants this way is simply untrue. Taking your own experience and projecting it on everyone else is an easy way to apportion blame but the facts don't support your argument in the slightest. Many people migrate to New Zealand, find employment and settle successfully. To that I could offer you a very very long list of facts. We appreciate comment and feedback but perhaps next time if you have something to contribute, add some facts to support your statement. We want to give potential migrants a balanced view but not simply act as a place for people to vent because of their own situations or dare I say it failings throughout the process.
Feb. 15, 2014, 9:04 a.m. by iain macleod
I am just struggling to work out how Mark never got a date....
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Feb. 14, 2014, 11:52 p.m. by Don

Please visit my website [link removed] to see what NZ is really like to migrants. Please be sure to read all the Migrant Tales Section articles before you make up your mind.

Replies to this comment

Feb. 15, 2014, 12:17 a.m. by Paul Janssen
To Don and others posting website links on the blog page - we do not provide a vehicle for you to advertise your site and all posts of a similar nature will be deleted. You are more than welcome to post genuine, comments and feedback but any advertising attempts from multiple accounts will be deleted.
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Feb. 15, 2014, 12:02 a.m. by Ben Milf

I know foreign PhD’s here who came to be part of the “quality of life” and are scrubbing test tubes and mopping floors (based on the fact that actually have real experience in their profession).

I know doctors and executive managers who are driving taxi cabs.
I know Project Managers who are pressing sheets.
I know industrial designers who are making beds.

I have never seen a people so terrified of “reality”. And I did not think it possible to have an entire culture based on “lying”.

Why? Because you cannot be afraid of reality and tell the truth.

New Zealand is a collective “fantasy world” which – because of fear – is falling backwards through time at an exponential rate: in other words, its dropping like a rock towards the Stone Age.

One of the many shocks I suffered here when I got off the plane in August 2007 was the realization that New Zealand was 25 years behind the rest of the entire world. And now, barely three years later – it is 35 years behind the rest of the entire world – and no one cares.

Replies to this comment

Feb. 15, 2014, 12:26 a.m. by Paul Janssen
Hi Ben, which part of the 'far advanced' future do you hail from? Every country has people working in occupations different from their skill set, no surprises there. This is usually a consequence of culturally incompatible migrants or those with poor English skills moving to NZ without having researched their employability before hand. To say however that NZ was 25 year behind the world in 2007 and 35 years behind now is simply a nonsense. It doesn't take much research to work out that New Zealand is at the leading edge of a wide variety of fields and has a highly developed service sector. We welcome discussion, debate and opinion but next time perhaps come armed with a few facts to support your statements so that we can get some value from them.
Reply to this comment
Feb. 15, 2014, 9:34 a.m. by iain macleod

This is clearly a cut and paste job from another website given it was posted somewhere else in 2010 (the guy had been here for three years when he posted it and he said he arrived in August 2007).

Even if it were a current comment and not some malcontent I do wish he'd have the grace and courage of using his real name and his real email address then we might take him a bit more seriously. We are going to leave this post up in the interests of our own credibility - we have nothing to fear from lunatics venting their spleens when their migration experience turned sour.

But reading some of these posts one has to wonder if these people ever stopped and looked in the mirror.

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