Demand grows for skilled workers

The Hays Global Skills Index shows an extremely high demand for engineers and some IT specialists. Pic Getty.

Rapid technological change has resulted in some IT specialists being paid $200 to $250 an hour, while at the other end of the scale, manually skilled workers are only earning a few per cent more than a year ago.

The recently released Hays Global Skills Index, part of an international report on supply and demand for workers, shows a huge talent mismatch between highly skilled and manual workers.

The report, Regional Dynamics of the Global Labour market: skills in demand and tomorrow's workforce, published by Hays, a recruiting company, in collaboration with British research firm Oxford Economics, is based on an analysis of professional employment markets worldwide.

The index shows New Zealand Employers' extremely high demand for engineers and some IT specialists. The score for job demand in high skill industries in New Zealand is 10, the highest score possible. Jason Walker, managing director of Hays New Zealand, says IT specialists who work in areas where the program or app is "directly engaging with the customer" and in web security are most in demand. Quoting from a job description, he highlights the demand for people who can operate a wide range of specialist software packages, as well as learn new ones. In the web security area, he says some contractors are "poachers turned gamekeepers", former hackers made good, as young as 23, although some others are in their 50s. Hourly rates are as high as $200-$250 an hour, for contracts lasting between a few months and years, equating to $400,000 to $450,000 a year, he says.

A perfect storm in New Zealand has brought about huge demand for engineering and building-related skills.

Walker highlights a variety of projects and causal factors, including the Kaikoura and Christchurch earthquake reconstruction, the Government's commitment to more roads and Auckland's International Airport redevelopment - which he says is a 20 to 30 year plan. "Fundamentally, construction drives our economy," he says. Walker says the supply of Kiwi-based civil engineers cannot meet the demand, and many skilled workers, some expat Kiwis, but also many others, are moving here from countries including the United Kingdom and Australia. Seismic experience is important, given the reconstruction near fault lines. Salaries range from $70,000 to $180,000.

He believes demand in the building sector will get even higher next year, as work on significant Christchurch projects moves above ground, requiring a variety of trades, and when work on the planned stadium starts.

Though IT experts and experienced engineers are paid megabucks, the Hayes Index shows wages are not increasing much for lower-skilled workers, despite falling unemployment. Overall wage pressure is just 2.6 per cent, (slightly ahead of the annual CPI of 1.7 per cent to June.) Walker says the trend towards automation (partly brought about by some IT specialists) is responsible for these continued low wages. "Demand is much higher for professionals in high-skill industries relative to medium- and lower-skill industries across New Zealand, since many routine, repetitive jobs can now - or will soon be - automated," he says.

The report notes this discrepancy raises a big question - who will be employed in future, and who will not? And how do individuals, trainers and employers, plan for this? Walker takes the positive attitude that new jobs will eventually replace those that disappear, but workers will need to "adapt their training... jobs will be changed rather than eliminated through technology skill set" to a more tech-centric workplace.

"Similarly, employers should look to adapt", to the inevitable change.

Looking at some of the report's data, the index indicates overall wage pressure in New Zealand is lower than many other countries, including Australia, the United States and Germany, but about the same as the UK. But the trend towards increasing demand for highly skilled workers, and lower demand for the low-skilled, is international, the report says.

Migrants to New Zealand are increasingly well-educated, the report has found.

In the US in 2015, nearly half of recent arrivals were educated to university level. In the European Union, the proportion of all people born in another country who were university educated in 2016 was 29 per cent, up from 26 per cent five years earlier.

The report also highlights the increasing number of people working freelance, or as contractors, worldwide. In the United States, the number of freelance, contract, temporary or on-call jobs has grown from 10 per cent to 15 per cent of all workers in the last decade. In Europe, freelance roles have grown four times faster than total employment in the last five years.

In New Zealand, 20 per cent of employers report they plan to increase contract and freelance staff, more than those who plan to reduce the numbers of contractors.