New Zealand needs skilled people to deliver much-needed infrastructure projects

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October 26, 2021

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The latest report by New Zealand Infrastructure Commission Te Waihanga makes a total of 67 recommendations, intended to future proof New Zealand’s infrastructure services for the generations to come. Te Waihanga has given the Minister for Infrastructure a draft strategy that sets a path for how New Zealand can overcome major infrastructure challenges and meet future needs.

Civil Construction & Engineering Pipeline

30 years from now another 1.2 million people may call New Zealand home. Since 2000, the number of people working in heavy and civil construction has more than doubled, yet construction labour productivity lags behind the rest of the economy. The cost to build infrastructure has risen rapidly. There are many reasons for this, but a major factor is a labour shortage, now the worst since 1975.

New Zealand has approximately $61 billion worth of infrastructure projects planned in its pipeline of upcoming work. Most of these projects are planned for the next three to five years. Over the next 30 years, this pipeline is anticipated to grow by as much as $140 billion. There is also significant demand for residential and other types of construction that adds to our capacity challenges.

The share of construction firms reporting labour shortages is now at its highest ever level. This is made worse by ongoing international competition for talent. Australia also has a severe labour shortage and with weekly wages that are, on average, NZD$500 higher than New Zealand’s, many New Zealanders cross the Tasman for work.

These labour shortages are likely to continue for years to come. Forecasts show New Zealand will have a shortfall of approximately 118,500 construction workers in 2024. Skill shortages are particularly noticeable in regions like Auckland, where it’s holding up work on important projects.

Building capability to improve infrastructure delivery

New Zealand needs people with the skills to plan, build, operate and maintain the infrastructure needed.

• Client and project leadership: Roles such as client leadership, planning, procurement, asset management and project management.

• Engineering and technical: This includes civil and structural, mechanical, and electrical designers, architects and engineers. It also includes specialist areas such as business information modelling.

• Construction management: Roles such as site supervisors, site engineering staff and construction managers.

• Skilled trades and labour: On-site roles such as electricians, welders, carpenters, scaffolders, steel fixers, fitters, tunnellers, plant operatives and labourers.

New Zealand also needs to build its competitiveness for international talent. One way of doing this it to develop a trans-Tasman procurement market by taking a consistent approach to qualifications, product and building standards and contracting and procurement processes.

Boom and Bust cycles can’t continue

Smoothing out boom and bust construction cycles can help to keep skilled workers. A credible infrastructure pipeline and priority list can help smooth out boom and bust cycles in the construction sector. These cycles make it hard for construction firms to grow and retain their staff, improve skills and invest in productivity-improving technology. Showing the industry which projects are planned well in advance and procuring them in a predictable fashion can help to smooth out boom and bust cycles.

Improving diversity in the Infrastructure sector

A training and career development pipeline is needed to help bring groups that are currently underrepresented into the construction sector. This will grow our construction workforce and also offer many other benefits. Greater diversity has been demonstrated to improve staff recruitment and retention, innovation and group performance, reputation and responsibility, and financial performance.

Women in Construction

A 2020 survey of the construction sector commissioned by the Ministry for Women on women entering trades found that many women suffered from negative employer perceptions that were barriers to finding work. Some of these perceptions were that women lacked the physical strength for trade roles and that they were not worth investing in as they would have to leave to have children.

For women who worked in the construction sector, or wished to enter it, the most common barriers were:

• Lack of knowledge about opportunities within the trades.
• Lack of direct work experience which often made it difficult to enter the sector.
• The difficulty finding employers willing to employ women, showing that traditional views on gender roles were still prevalent.
• The male-dominated culture of the trades was intimidating, which reduced applications from women.
• Lack of flexible work practices impacted on the ability of women to both work and undertake parental duties.
• On-site constraints such as the lack of lifting equipment and poor conditions.
• Lack of support for women in the trades.

Interviews with six employers by the Ministry of Women’s Affairs in 2011413 found that once employed, women were seen as important to their teams. Employers said the key benefits included:
• An improvement of work culture. For example, better behaviour, less competition and more collaboration.
• Competitive advantage. For example, a plumbing firm got more work as their female plumber could work in public women’s bathrooms/changing areas without the need to temporarily close these.
• Women brought different and valuable skills to the roles. For example, it was frequently noted that they had excellent attention to detail and provided good customer service.

What happens next

The draft strategy has been presented to the Minister for Infrastructure for feedback, which is to be provided by the end of December 2021. The final strategy will be given to the Minister by March 2022 to be tabled in Parliament when practicable. Within six months of receiving the final strategy, the government must provide its response.

Source: New Zealand Infrastructure Commission Te Waihanga 2021

 Draft New Zealand Infrastructure Strategy

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