Bob Jones: Cheap labour will fix housing crisis

New Zealand could look to Dubai for ideas on how to solve our housing shortage. Photo / Getty Images

Why not take a leaf out of Dubai’s book and invite a host of guest workers to help alleviate the problem.

Thanks to a continuing population influx, Auckland is booming and as with many other burgeoning foreign cities, unsurprisingly there is a serious housing shortage.

But it's silly to blame politicians, as has occurred. Far better to concentrate on solutions, for make no mistake, the problem will reach a crisis stage in the next few years, for one all-important reason.

That is the phenomenal amount of non-residential construction scheduled to commence. This will drive up construction costs, particularly given the shortage of building tradespeople, compounded by the inadequate apprentice numbers.

I have a solution which may induce initial antagonism, but viewed calmly, it's perfectly logical. National's policy of providing more cash for first-home buyers is certainly not addressing Auckland's problem. Instead it will heighten it by increasing demand, although outside of Christchurch it will have merit in assisting first-home seekers.

Recently, we legislated that our worker standards must apply to foreign trawlers fishing our waters. On face value that appeared virtuous. In fact, it's utterly hypocritical.

Our living standards rely on incredibly cheap goods from Asia. They're cheap thanks to low labour costs, as on the foreign fishing boats. So to be consistent, why not impose the same fishing boat rules to imported goods? There are two answers.

First, in terms of moral inconsistency, it's analogous to the abortion debate. What can't be seen, namely Chinese factories and unborn babies, conveniently doesn't count.

The second excellent reason is that free trade is unquestionably mutually beneficial, and as with Japan and increasingly Korea, in a few years, fast-rising Chinese living standards will see this low labour cost manufacturing continue its westward move to Southeast Asia, then the Indian sub-continent, and if robots haven't by then killed off menial jobs as inevitably they will, then on to Africa. Everyone's a winner.

Actually, minimum standards are imposed by America, albeit not the same as Western equivalents. A few years ago I met a young American woman in Bolivia who was taking a break from her job as an inspector overseeing Caribbean factory and labour standards.

If they weren't up to scratch she could block their exports to the US. Her concerns were wages and working conditions. America has similar inspectors in Asia following a public clamour after revelation of some Chinese factories' then appalling standards.

So accepting that low Asian labour costs are mutually beneficial, the answer to attaining a mass supply of housing in one fell swoop, is to emulate Dubai and, as a one-off exercise, import an army of cheap sub-continent labour. Dubains reject manual work, aside from which they're too small in population to achieve what they have without outside help.

Fletcher recently announced it is going big on housing. We should allow it to build confined barracks to house several thousand sub-continent building tradespeople they can import, who, motivated by money, will work six-day weeks. It's not all plain sailing. Not long ago I met an English architect based in Dubai. He told me sub-continent workers need several layers of supervisors to ensure Western standards, but these would come with the package.

David Shearer was rightly ridiculed when he announced Labour would build an extra 10,000 homes annually, simply because it's not possible with the current, under-pressure building industry. But as a one-off exercise, by importing say 10,000 Indian building tradesmen, we could quickly create whole new suburbs, targeting first-home buyers and additionally, do so much cheaper than currently is the case.

If there are concerns about competence given that building Dubai's towers amounts to semi-skilled labouring, the skilled sub-trades of joinery, plumbing, electrical, etc, are also done by imported the Indian workers as no Dubain would sully himself with such toil. Obviously therefore, they're up to it.

Another option lies with high-rise apartment blocks, currently being promoted by the Auckland Council. But they'll be uneconomical for purchasers given the inevitable looming surge in building costs, brought about by the imminent commercial construction boom. So why not let developers negotiate with Chinese construction companies, skilled in building high-rise apartment blocks, and allow them to fly in armies of workers and knock these up. The Chinese government is currently pressuring their banks, concerned at the amount of speculative high-rise construction, so it could be a timely move.

Importing construction tradesmen in dribs and drabs from all over the world, but mainly Britain, as has been done in Christchurch, is far too slow a process to deal with the looming Auckland supply crisis. We need a one-off wholesale measure to knock the top off the problem. It's no different in principle than our seasonal importing of Melanesian labour to pick and process Hawkes Bay fruit, or buying children's leather shoes for less than $10 and televisions for a fifth of the cost if made here.

As I've said, everyone's a winner.

Debate on this article is now closed.