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Home / Business / Companies / Tourism

Tourism businesses should pay more to hold staff says expert

Grant Bradley
By Grant Bradley
Deputy Editor - Business·NZ Herald·
3 May, 2017 12:00 AM4 mins to read

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It's harder finding staff to serve food and wine because of a labour shortage.

It's harder finding staff to serve food and wine because of a labour shortage.

Government moves to restrict immigration could exacerbate a shortage of workers in tourism although one expert says if wages were higher more young New Zealanders would be attracted to the sector.

Statistics New Zealand figures show close to 332,000 people directly or indirectly employed in tourism.

An estimated 36,000 more could be needed in the next eight years if tourism continues at current growth rates but entry level wages are notoriously low.

Tourism Industry Aotearoa says there are thousands of chefs needed throughout the country.

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However, the head of the hospitality department at Auckland University of Technology David Williamson said low wages in the sector and a low regard for hospitality training meant it was a struggle to attract young New Zealanders.

The shortage could be worsened by Government moves announced last week. In a bid to attract more skilled migrants the Government has introduced an income threshold.

To qualify in future, immigrants will need to be coming to a job paying at or above the median wage ($49,000 a year). This will have a direct effect on hospitality and tourism where starting wages are generally low and foreign workers make up a high proportion of the labour force.

The average wage in the hospitality industry is around $40,000 a year.

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A Hospitality New Zealand survey found 17 per cent of staff in the a sector were on work visas.

Williamson said they typically went from education here to part-time work to applying for permanent residency and citizenship.

Overseas workers were particularly vulnerable.

''It's well established that migrants will take lower wages, are less likely to join unions, and less likely to complain about things. And we've seen some of the egregious treatment of migrants by some, not just in our industry but in others."

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Williamson has just finished a PhD on what influences wages in the tourism sector, said pay was about 21 per cent to 22 per cent lower in real terms than what it was in the mid-1970s.

"If you're not going to pay people decently you're not going get New Zealanders working in this sector," he said.

Young people were "bounced" out of the sector at an early stage.

"We're talking about those entry level. They're attracted to it but they're paid wages that they can't afford to live on and other industries outbid us."

While the service sector was booming here and around the world, this country did not value service workers as it should.

"We've had a long culture in this country of looking at service work in a negative way. Increasingly we have known that service work is where modern economies are transitioning."

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Williamson said the opportunities in tourism were fantastic and there needed to be a more positive approach taken to studying tourism at school. Student credits for NCEA tourism studies no longer counted towards university entrance.

"Taking tourism studies out of university entrance and that's a clear message to parents that its' a dummy subject and you don't want your kids doing it."

Tourism Industry Aotearoa chief executive Chris Roberts said the university entrance credits system was being reviewed but the present situation undervalued tourism and it was being used as a "dumping ground" for non-academic students.

He said all employers needed to look at whether they could pay more to their staff to retain and attract them.

"It is one of the tools in the tool kit."

However, Roberts said tourism jobs also gave staff the chance to move overseas if they worked for international chains and it was relatively easy for workers to start their own small businesses.

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Dylan Firth, policy and advocacy manager for Hospitality New Zealand, said if wages went up so would prices.

Hospitality businesses were also facing rising rents, health and safety and food safety compliance costs.

While many young New Zealanders were doing hospitality jobs overseas, foreign workers made up a big proportion of those in New Zealand restaurants and the new immigration rules would mean many of those trained up for three years would not quite meet the income threshold and have to leave the country.

This could lead to a shortage of staff in three years time, said Firth.

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