Distinguished Professor Emeritus Paul Spoonley, Koi Tū Academic Associate

Peter Gluckman noted [1], in a recent opinion piece, that the policy responses across the globe to the pandemic have “not been consistent or coherent”. This is nowhere more apparent than the mismatch and variability that have emerged between countries and regions, and sometimes within countries, on what to do about re-establishing international mobility. This has a range of implications: the suspension of labour mobility and the consequent (and often chronic) labour and skill shortages that have emerged in economies around the high income world, the social and economic challenges for families and communities who are globally dispersed (and for whom it is not clear when they will be able to meet in person again)  and the anxiety for those wanting to apply to migrate or who might be in the process – and who do not now know what will happen or when.

Mobility and migration, both permanent and temporary, have been hugely disrupted across the world. There is a lot of pressure to resume mobility in some way – but the lack of international agreement about what might enable this to happen, the appearance of new variants, new waves of hospitalisations and deaths from Covid-19, and the tension between economic and public health considerations all make the possibility of resuming significant cross border movements (outside of some regional arrangements such as in Europe) any time soon extremely challenging.

It might be quite some time before international mobility is resumed at anything like previous levels. There will need to be a lot more thought given to what agreements, policies and procedures need to be in place internationally for this to be done safely.

We want migrant workers – now!

Locally (and internationally), there is no shortage of media coverage of the labour shortages that exist in a range of industries as Covid has brought labour migration to a halt and stripped out international labour supply. And there are plenty who are demanding that their sector or firm be allowed to bring in the required labour, both on temporary or permanent visas. It is no consolation but almost exactly the same media coverage on what these shortages mean, and how serious they are, can be found in most OECD countries.

In one sponsored content page locally, the Managing Director of a New Zealand healthcare provider claimed: “…this [the shortage of nurses] is not a pay issue, it’s a supply issue. Instead of allowing nurses in from overseas, they [the government] have decided to burn out the nurses we have here’ [2]. Others asked to “jump the queue”, in this case, in order to provide a workforce for dairying [3]. There are warnings that even those who are here and have the needed skills are getting frustrated and are leaving [4].

Systems for assessing and approving migrants have been suspended in New Zealand since early 2020, leaving those in the online system with little to indicate what might occur – and when. It traps those in New Zealand on various temporary visas with only relatively minor adjustments to their visa conditions and no long-term certainty. And there is little on offer for new migrants to be recruited to meet labour demand. The suspension of mobility and the flow of migrant labour, combined with a reluctance to re-establish mobility any time soon, has been the source of frustration and a great deal of criticism [5].

Many countries are now going through a migration policy framework rethink and reset. Countries such as Australia, Canada and the UK are reviewing their policy settings, and are typically looking to balance labour market shortages (as much in relation to lesser skilled work as high skilled) with a range of local political considerations. Those considerations range from outright hostility towards migrants (and have resulted in moves to significantly reduce migrant flows and rights) through to concerns about the impacts of migrant labour on labour rights or access to work for local citizens. Some of these latter concerns appear in the questions that the Productivity Commission has been asked to consider for New Zealand.

The lack of migrant labour has also highlighted the fact that it is not simply high skilled labour in areas such as healthcare and digital industries that is a concern. Picking and processing crops has been an equally significant challenge for many countries. There are signs that this might even lead to the “Singapore model” being adopted, with its relatively generous provisions for skilled, professional migrants but with tight and exploitative (in the sense of few rights and easy expulsion) conditions for temporary low-skilled workers.

The suspension of labour mobility has added significantly to the “labour crunch” that had been a feature of high income countries as the impacts of an ageing population combined with declining fertility emerged over the last decade.

The return of mobility will be slow

The question now turns to what needs to occur for this mobility to return and in what form, given the nature and impacts of Covid which have changed the risks and imperatives. Part of the answer lies with individual countries and what they require, both in relation to immigration settings and Covid-related public health requirements such as quarantine. But cross-border travel involves a lot of moving parts, only some of which are under the control of individual countries. Perhaps the equally significant and immediate challenge is the need to consider and agree upon international protocols and measures.

Those who are tasked with looking at travel issues have been warning for some time that the systems are not in place to preserve low-risk, much less risk-free, travel. Nick Careen, who is a specialist on biosecurity for air travel with IATA, noted in May 2020 that in order to restore air connectivity, systems needed to be “internationally consistent, mutually accepted and harmonised”. For him, this included pre-flight processes, check-in, the processes at the departure airport, boarding, what happens during the flight, then at the arrival airport, how border crossings are to be treated as well as what happens to those in transit. New Zealanders will be well aware of (and frustrated at) the disconnect between flight availability/arrangements and quarantine bookings.

There are some limited moves to consider these issues but a huge amount of variability (countries, airlines, airports) and harmonised and agreed systems appear a long way off. In 2020, IATA was forecasting 2024 as the year when volume in air travel would return [6]. This was endorsed by a Deloitte Access Economics report (again, the 2024 date) while the UN World Tourist Organisation anticipates that international tourist numbers will not return until 2023.

There appear to be some significant stumbling blocks. Take vaccine passports for example. The issue of how to establish that a traveller is vaccinated, with what vaccine and the date of the vaccination, is still some way from being a reality, at least internationally. This is partly because, as with many other aspects of cross border activities, there is no international agreement – and often outright disapproval of what other countries are doing – and opposition. Look at the protests at the “Pass Sanitaire” in France.

Quiggin points out that New Zealand and Australia might be in the enviable position of offering a vaccine passport as a way of restoring freedom to be able to travel rather than in most of Europe where these vaccine passports are seen as another element in restricting freedom and imposed by “untrustworthy” authorities. But as he goes on to comment, the major hurdle is likely to be “…administrative failures that have plagued every aspect of Australia’s response [to Covid]”.

So what are the possibilities in terms of regaining mobility in the context of an ongoing pandemic? And what lessons can be learned from those regions (such as the EU) where a degree of mobility is now taking place?

There are some interesting models emerging that indicate what might occur. All have one thing in common – there are major hurdles to overcome and few signs of international co-operation at this stage.

In one set of scenarios [7], there are four possibilities although they are not exclusive – elements of each might co-exist in one setting. The four are:

1. Pandemic proofing – this is seen as similar to what happened after 9/11 with international standards and procedures on “risk assessment, time limited emergency travel restrictions, expanded data sharing and consistency on testing and screening” being put in place. This might occur unilaterally (the security requirements now imposed by the US Government on airlines and departure airports, for instance). The key here is an agreed system that allows governments, airlines and various private sector players to verify health status (such as vaccination status) and the option to suspend travel at short notice.
2. Mobility with friends – this is based on regional agreements (between “friends”) with the most successful built around clear and strong bilateral co-operation and trust with agreements about risk assessment and the ability to trigger rapid restrictions.
3. Chaos and fragmentation – there are new options in place to check and monitor travellers but most options do not move beyond the piloting stage. There are distinct, different and frequently changing approaches between countries (and sometimes within countries e.g. USA, Australia) with low levels of trust. There are “stark divisions” internationally and the “concertina of opening and closing borders continues, especially as further variants of the virus emerge”.
4. Pre-pandemic status quo – this is identified as the most unlikely scenario in the intermediate future and it would need Covid-19 to decline to such a point that it does not represent a significant threat.

Bilateral bubbles (“mobility with friends”) are one option. But one word: “Australia” (or perhaps three, “New South Wales”). The Migration Policy Institute (MPI) author warns that even with careful pre- and post-departure arrangements and inter-country agreement, the nature of the pandemic and new variants will mean “two steps forward, two steps back” in many instances.

It is interesting to look back at what was said by those commentators who were pressuring the New Zealand Government to open a bubble with Australia earlier in 2021. Most did not mention the possibilities that this might create new risks and compromise New Zealand’s Covid-free (and especially, as we now know, Delta-free) status [8]. The arrival of the Delta variant from New South Wales and resulting lockdown in New Zealand (and in Australia) is a rather salutary lesson when it comes to inter-country agreements on international travel.

Of course, it could have been other travellers from other countries but it just so happened to involve a traveller from Australia at the point at which a trans-Tasman bubble looked a promising option.

The bilateral possibilities with Australia are also complicated by the tensions between the federal government’s approach and that of states, and between states. As Michelle Grattan commented recently, “Australia’s federation [is]…now more fractured than at any time during this crises in a toxic mix of policy differences and politics”. What will harmonisation of the policies and procedures for Australia’s international border look like in the future, especially with states adopting very different approaches and the emergence of hard internal borders? And how should New Zealand proceed in re-opening travel with Australia? And when?

This applies to any other country that we want to establish a bubble with. What are the risks – and are they manageable? And how should we harmonise what happens domestically in these source countries with New Zealand interests and intentions?

Social license for delayed and restricted cross-border mobility

Quite apart from labour market pressures to access migrant workers, there is considerable enthusiasm to resume travel for business or leisure purposes. This is off-set by incursions and the spread of new variants, putting health systems under considerable pressure. We can learn from other countries.

In the UK, under lockdown in May, there were just under 2,000 new Covid cases per day, with a daily death toll of 15. Restrictions were loosened on the 21 June and then again on Freedom Day, 19 July 2021. By September 2021, the daily infection rate (on average) was over 30,000 (compared to about 2,000 under lockdown although this is less an issue than hospitalisations and deaths [9]) with between 130 and 150 daily deaths and a 1,000 hospitalisations per day [10]. And that occurs in a country that has vaccinated 70% of the adult population. The result has been a decline in the public’s trust in government (a drop of 15% in the second half of 2020).

So what mandate do governments have? And what happens to that mandate when rates, especially of death or long Covid, rise and the resources of the health system get diverted to manage Covid admissions?

One of the aspects of the public response that has marked New Zealand as being different to many countries has been the relatively high levels of trust in political leaders, the health professionals who have provided advice and the various agencies that have played a role in risk assessment and public health measures. And while that trust has fluctuated, it appears to return to high levels when Covid incursions and spread occurs. We noted this in an earlier report on social cohesion but as we have encountered different challenges and crisis points since March 2020, the level of support for the actions taken have remained relatively high. In August 2021, a poll showed that 84% of those responding approved of the move to Level 4. Other polls, and the material from Google maps which indicates the activities of New Zealanders compared to other countries, remain relatively high in terms of compliance.

This level of support is in sharp contrast to many other countries where trust in key societal institutions has dropped significantly during the pandemic. In this regard, there has been a public mandate for the New Zealand Government to continue to maintain strong border measures and not to open up anytime soon – so far. While some business leaders and employers have argued for urgency and some relaxation, the government continues to retain a significant degree of social license to continue its current elimination approach and strict border control policies at least until vaccination rates are very high. Of course, an extended or any further potential lockdowns in Auckland might strain this social license but for now, it remains high compared to many other countries.

And when migration resumes

There is considerable frustration at the slow pace of the government’s immigration reset combined with the lack of transparency and future options or pathways. One of the issues will be to develop policies that are informed by the work that is currently being done by the Productivity Commission – although this work by the Commission remains advisory and will always be subject to political assessments and decision-making.  Ideally, we need a long-term pollical consensus on our population policy.

During the boom years of net migration gains (2017-2020), two-thirds of New Zealand’s population growth (as high as 2.2% pa compared to an OECD average of 0.4% in the same period) was driven by net gains from permanent migrants (79,400 in the June 2020 year). And this metric does not include the 221,298 migrants who were in the country on short term working visas (this figure does include those transitioning from temporary to permanent residence) or the 81,999 here on study visas when the country went into lockdown in March 2020. There were more migrants (temporary and permanent) entering the labour market annually than those leaving the school system [11].

These extremely high numbers have contributed to very high population growth rates and been a major source of labour supply.  This has led to questions about whether the reliance on migrant labour has suppressed productivity gains, led to a lack of investment in training and education that might address some of these labour market shortages and had impacts on domestic workers (labour market displacement, the suppression of wage growth). There are also questions about the pressure on infrastructure of such high levels of population growth and immigration. As one editorial put it [12]:

…this country and its infrastructure have certainly struggled under the weight of so many arrivals over the past decade, and that reliance has meant that traditional labour-market muscles have been weakened through under-use, even in the primary industries that defined who we are.

It seems unlikely that we will return to the very high levels of inward migration of both permanent and temporary migrants that occurred in the 2017-2020 period. By contrast, net migration contributed 0.4% to Canada’s population growth in the 2020 year; in New Zealand, net migration contributed 1.5%, three times the Canadian rate.

The challenge is now to apportion the lower numbers that will be arriving as migrant labour to those sectors most in need. How will this prioritisation work? What will the mix be between the highly skilled and the lesser skilled that are part of (for example) picking and processing in horticulture and agriculture? What about the priority given to growth areas such as high tech or the possibility that a more deliberate focus on an investor category might have disproportionately higher benefits for the New Zealand economy? There are also the costs and impacts mentioned above — those of providing infrastructure in a period of high population growth [13] driven by immigration or the need to train/retrain/upskill the local workforce.

It is timely to look at New Zealand’s education and training systems, alongside any reconsideration of the immigration system and numbers, to better align labour supply and demand. There has long been a disjuncture between the benefits and costs of major flows of migrants, both temporary and permanent. One question for the Productivity Commission might be the extent to which employers and sectors should be contributing to the costs of ensuring either a local labour supply or the costs, both direct and indirect, of immigrants, especially in relation to the growth in aggregate demand associated with migration and population growth. This is already done to some extent with the Recognised Seasonal Employment Scheme (the provision of accommodation or transport) or employer-sponsored migration. If the benefits accrue to employers and businesses, shouldn’t they also contribute to the costs if labour supply is such a priority?

Countries are extremely varied in what they will – and will not – allow, both in terms of cross-border travel and in re-establishing systems of migration (with the notable exception of the return migration of citizens).

Canada is one country that has set a significant target of 401,000 per year (which would be just over 50,000 net gain if translated into a New Zealand context or equivalent to 1% of our population – which might be a useful target). But many of these “new” migrants will actually come from those already on shore in Canada as temporary migrants, something New Zealand might do more extensively. There is also the Provincial Nominee Programme in Canada (or the new Welcoming Cities/Welcoming Regions approach in Australia) which invites regions to play a key role in immigrant attraction and approval – and settlement.

But there are significant challenges in the enthusiastic approach adopted by Canada, including the proportion of places allocated to lower-skilled workers, the need to “protect foreign workers and shield the domestic workforce from any deterioration of wages”, the need to invest in settlement and to address public concerns about the economic contribution of immigrants [14].

The next stage immigration system for New Zealand – policy settings, numbers, the mix of temporary and permanent, or skilled and lesser skilled, regional interests – urgently needs some clarity to provide an indication of what employers and sectors can expect. However, this still requires some critical decisions about the way in which this mobility will take place. Alongside the future of immigration, it is also an opportune time to reconsider broader issues of training and skill upskilling/recruitment/retention as the nature of employment continues to change and labour scarcity becomes an even greater issue as demography reduces domestic labour supply.

Final thoughts

The Economist (May 2021) talked about the need to consider the three “Ps”: payments (or the levels of pay for domestic workers); passports (what does mobility look like in the wake of Covid?); and patience (there will be no easy solutions) [15]. I would add a fourth “P”: population.

The lack of worker mobility during the pandemic has highlighted the reliance of OECD economies on migrant labour, both skilled and lower skilled. But the immobility imposed by the pandemic has underscored the growing worker deficit or, as The Economist calls it, the “labour crunch” [16]. That has been driven by the declining numbers in the prime working age bands of high income countries as they experience declining fertility and the exit of workers because of an ageing population.

Labour migration is important and needs to be recommenced. But it requires local and international systems that deal with the public health risks of travel and the viral spread that is associated with Covid-19. Such labour supply issues need to be seen alongside a range of domestic considerations and costs (as well as the benefits), including the long term shifts in the nature of work and the implications of a major change in our demography. And Covid is nowhere near done as the bubble with Australia has proven. Patience is challenging under these circumstances.

The hope is that high rates of vaccination and continuing public health measures will moderate health impacts. The lack of a plan in terms of mobility, including labour mobility, both locally and internationally, remains something of an ongoing challenge.

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[1] My thanks to Sir Peter Gluckman for comments and suggestions on this opinion piece.

[2] Radius Care sponsored content, Nurses shortage threatens NZ, New Zealand Herald, 1 September 2021.

[3] Gullery, L. Can we jump the queue, please?, Waikato Times, 13 July 2021.

[4] Fonseka, D. Exodus. Skilled migrants have had enough of the immigration frustration. Sunday Star-Times, 25 July 2021.

[5] Fonseka, D. Skilled migration : The congestion and frustration. Sunday Star-Times, 11 April 2021. MacNamara, K. Rotting fruit exposes stale Govt thinking, New Zealand Herald, 27 March 2021. Keall, C. ‘Anti-immigrant’ NZ moving goalpoasts, says angry tech boss, New Zealand Herald, 7 August 2021.

[6] IATA, Recovery delayed as international travel remains locked down, Press release No. 63, July 2020.

[7] Benton, M. Future scenarios for global mobility in the shadow of pandemic, Washington: Migration Policy Institute, July 2021.

[8] See Editorial, New Zealand Herald, Transtasman bubble set to give big boost, 22 March 2021; Cotterill, B. It’s time we said gidday again to our mates, New Zealand Herald, 27 March 2021; Bradley, G. Open the bubble and win a $1b prize, New Zealand Herald, 26 March 2021. There were some that did anticipate issues: see Michael Baker’s comments plus Editorial, New Zealand Herald, Trouble with Tasman bubble, 26 March 2021.

[9] Comment from Sir Peter Gluckman, pers. comm.

[10] See https://graphics.reuters.com/world-coronavirus-tracker-and-maps/countries-and-territories/united-kingdom/ and https://coronavirus.data.gov.uk/details/cases.

[11] Robertson, G. Terms of reference for an inquiry into immigration settings for New Zealand’s long-term prosperity and wellbeing,

[12] Editorial, Migrant tap hard to turn off, Dominion Post, 19 May 2021.

[13] Hickey, B. Tiptoeing around the elephants, Sunday Star-Times, 14 February 2021.

[14] Banerjee, R. and Hiebert, D. Leveraging human resources for long-term prosperity : Expanding pathways to permanence for lower-skill temporary workers in Canada, Policy Paper, Ryerson University.

[15] The Economist, What to do about a labour crunch. The curious case of the disappearing worker, 22 May 2021.

[16] See New Zealand Herald series in June 2021, Out of workers.

See also:

• Media release: Urgent rethink on migration policies needed
• NZ Herald: Covid 19 Delta outbreak: What needs to happen to regain global mobility again
• RNZ Nine to Noon: What is required for international mobility to resume? (Interview with Prof Spoonley, 17′ 59″; 6 October)