Britain snatches skilled Kiwis

Skills shortages affecting New Zealand businesses have been dealt another blow with a British work visa scheme attracting our high flyers, writes STEVE HART.

A new working visa scheme to encourage people to work in Britain is starting to affect companies here. The "highly skilled migrant" scheme was launched by the British Government to fill a skills shortage in professions such as accountancy, law, health, IT and education - the very people we need more of.

Until the scheme was introduced, New Zealanders would work in Britain and employers here would then bank on most returning to the local market after two years or so. But under the new scheme, professional workers can stay for four years and then may be eligible for residency in Britain.

"It could lead to a lost generation of skilled workers that New Zealand could desperately use," says Bernie Kelly, managing director of Global Career Link, which is networked to 130 recruitment consultancies throughout Australia, Asia/Pacific, Britain and Europe.

His firm has kept in touch with 750 professional New Zealanders working in Britain. A member of his team visited London to meet 300 in May to find out their long-term plans.

Kelly said: "The message coming through is that many of those we met are planning to stay longer. With a four-year visa and the option of staying indefinitely, they can buy homes and settle."

One of those who arrived in Britain on a two-year working holiday visa and has converted to the new four-year option, is 27-year-old Janine Norton.

She has been in Britain for three years and plans to stay for "at least another two".

Norton, a management accountant working as a contractor, says the prospect of gaining residency in Britain is attractive but she is mostly enjoying the chance to travel.

"I can work for six months and then travel for six months. There is no way I could afford to see as much of the world as I have on the dollar," she says.

"Contracting allows me to earn a lot more money and I can save to take money home."

Another is Myles Harrison who has also been working in Britain for three years and says the new scheme means he is not tied to a sponsored employer.

The 29-year-old chartered accountant is working for the British Government's Department for Environment Food and Rural Affairs and says the new visa means he has the freedom to do contracting work "but gaining residency is not something I'm considering right now.

"I believe most New Zealanders here will go home eventually," says Harrison. "But it may take a few years longer."

Kelly said: "The losers are the large and growing New Zealand-based companies who need these people to help them to compete in the international markets.

"The prospect of staying somewhere while earning £80,000 to £100,000 and living in comfort is different from struggling in a bedsit with far less money and your visa about to expire."

Apart from the obvious drop in business for recruitment firms, Kelly says companies here are starting to feel the pinch.

Laurie Finlayson, national director of human resources at Deloitte, which employs 700 people in New Zealand and typically has 40 members of staff on secondment abroad each year, says the company's succession planning is already being affected because staff are not returning home as expected.

"We have had a few of our secondees who have gone to Britain, subsequently discovered this scheme and are now staying longer. Normally we put people on a two-year secondment and expect them back with more skills and more maturity.

"They are maintaining their connection with us, but we are now sitting and waiting with gaps in our succession plans. Our plans are based on people staying away for two years, but now it is four."

The knock-on effect is that people staying abroad longer are developing more advanced skills. Finlayson says this makes them more marketable on the world stage, but blows companies' career plans for staff.

"We are finding that by extending the time offshore, people's skills develop to a more advanced level and that has an impact on our hire costs here.

"For example, we would send someone out as a senior and plan to have them come back as a manager. But when they come back as a senior manager it makes it tougher to place them because there are fewer of those positions.

"They also ask for six-figure salaries and we say, 'Hang on, our model and our budget structure says we were going to bring you back as a manager'.

"It is causing us to do a lot of rethinking to decide if we can accommodate that extended secondment.

"It may mean that we ultimately part company and resource ourselves from inhouse or with more cost-effective people.

"It adds to the whole skill shortage and market competitiveness. It is another factor that makes it even tougher to get the right people with the right skills from the labour market."

Kate Weaver, HR manager for law firm Phillips Fox says recruitment is always an issue because the market is smaller for law firms here.

"New Zealanders have always gone overseas - particularly lawyers because they can work in London," she says. "The new scheme may affect us later on if they don't return to us after two years, but it hasn't had any effect on our ability to recruit. I think watch this space - it hasn't affected us yet, but it may do later."

Dale Gray of recruitment firm Momentum says there are many reasons the country's skills base is dropping away. The new visa scheme is one of them, but he adds that life has returned to pre-September 11 levels.

"After September 11, expats rushed back to New Zealand, but now people are more at ease with travelling and working abroad again.

"There is also a culture change with Generation Y that means many young and highly trained professionals are not loyal to anyone other than themselves. Loyalty to employers or even countries is not important to them."

It's almost a case of the self-centred, 'what's in it for me' culture of the 1980s, agrees Gray.

"This generation is looking to acquire skills and once they have them they move on to the next employer to learn new skills."

Gray warns that generation gaps in the workforce are already starting to appear. He says people aged between 40 and 64 make up 45 per cent of New Zealand's working population.

"By 2011, that age bracket will represent 51 per cent, or 300,000 people," says Gray. "And the age bracket for workers between 15 and 39 will drop by 18 per cent during that same period."

He warns New Zealand has a growing older workforce and with unemployment at a 16-year low at 4.3 per cent - the British visa scheme isn't helping New Zealand.

It looks like local companies will have to work harder to offer Generation Y the X factor to retain them and their much-needed skills.