Building talent to deliver strategic outcomes

The shift from delivering standalone infrastructure projects, or ‘pieces of kit’, to delivering strategic outcomes for New Zealanders, highlights the challenges regarding the capability and capacity of a mobilised infrastructure sector. These infrastructure programmes need to meet the needs of all New Zealand’s, work with mana whenua as partners, deliver jobs, access to employment and education, and be delivered and operated sustainably.

With the number of recent infrastructure announcements, the question being asked is whether New Zealand has, or can attract, the capability and capacity to deliver – who will build it?

In July last year, the Government announced a NZD380.6 million initiative designed to keep apprentices ‘connected to work, connected to training and connected to their communities while New Zealand recovers from Covid.’ This initiative and the pandemic have provided New Zealand’s infrastructure sector with opportunities to refresh and renew its focus on people.

MinterEllisonRuddWatts asked Te Pūkenga NZ Institute of Skills and Technology CEO Stephen Town, Ross Copland of the New Zealand Infrastructure Commission Te Waihanga and Ngāi Tahu’s Chief Executive, Mike Pohio to share their insights on the strategies we need to encourage diversity, and attract and retain the right people to the sector – and into the country.

Infrastructure is for people: Diversity is essential

There is a long way to go to improve workforce diversity in the sector, admits Ross Copland, but it is essential to deliver fit for purpose infrastructure.

“We are certainly not very diverse. This creates challenges, and I believe these are most prominent in areas such as design, urban reform, consenting, planning, engagement, consultation and bringing communities on the journey.

“If the industry doesn’t reflect the community it’s delivering infrastructure for, it’s hard to achieve buy-in, and we see that manifesting in poor consenting outcomes, designs that aren’t fit for purpose, safety design, or building places that people don’t want to be a part of.

"We need to begin addressing diversity if we want to build better quality infrastructure that’s fit for purpose and accepted by the communities who are inheriting it.” - Ross Copland, New Zealand Infrastructure Commission Te Waihanga

“We need to begin addressing diversity if we want to build better quality infrastructure that’s fit for purpose and accepted by the communities who are inheriting it.

“In a lot of ways, we haven’t made the infrastructure industry an attractive or flexible place to work, and we’ve lacked the effort to connect the tertiary education or trade training opportunities to the broader workforce, especially with Māori and Pasifika.”

This is backed up by Stephen Town who observes that while half of our population are women, almost no women participate in the broader construction sector.

“We’ve got a tiny representation of that half of our population. It seems to me that we’ve got to try and make the sector more attractive to a much more diverse range of people. We need to start conversations early, and currently 50% of school leavers have never had a one-on-one interview with a career’s adviser. We need to start talking to kids when they’re young, and not wait until they’ve left school and are scratching their heads not knowing what to do.”

Town believes the opportunity to progress diversity is captured in the direction Te Pukenga has been tasked by the Government, which is to turn around Māori, Pasifika, and disabled learner success.

"Over the next three to five years, we have been charged with engineering a way to address the diversity challenge.” - Stephen Town, Te Pūkenga NZ Institute of Skills and Technology

“These three identified groups have been very poorly serviced by the existing education and training system, which is why the Government has decided to change it. Over the next three to five years, we have been charged with engineering a way to address the diversity challenge. We believe the biggest impact will be to focus on these three groups which will ultimately benefit wider New Zealand.“

Beware ‘the global effect’ and a mobile workforce

Will New Zealand’s closed borders have a lasting effect on changing how the infrastructure sector attracts talent, recruits, and develops people?

Town believes we should focus on domestic employment growth and skill acquisition, but we need to be cognizant of the sector’s mobile talent pool.

“The trans-Tasman travel bubble is essential for tourism and families reconnecting. However, it also influences the availability of the construction and skilled workforce. When Australia’s infrastructure sector is buoyant, many Kiwis head there to work, as they can be better paid than here. This is an issue for employers here who have put the effort into training good workers, only to see them jump on a plane. I’m watching closely to see what happens over the next six to nine months with workforce flows.”

Backing up this viewpoint, Copland believes the remuneration delta and salary levels of the New Zealand market compared with Australia – and around the world – present a real challenge.

“Particularly pre-GFC, New Zealand saw a huge number of the infrastructure sector’s skilled workers moving across the Tasman and to Dubai. Unfortunately, New Zealand hasn’t managed to lift wages to a level where we’re competitive against these markets, and the delta in wages is potentially 30%, so this is a major concern.” Mike Pohio agrees: “We have a massive skills shortage because we can’t attract people into the industry and now, we can’t get people into the country.

"Our ability to build skills depends on being prepared to spend infrastructure money. People will flow to where the money is, and where they can get a reasonable balance in their life.” - Mike Pohio, Ngāi Tahu Holdings

Our ability to build skills depends on being prepared to spend infrastructure money. People will flow to where the money is, and where they can get a reasonable balance in their life. Ruakura, for example, will give people the benefit of offering an Auckland wage while living a less congested lifestyle.”

The workforce challenge

For Town, another key challenge is the scarcity of people within New Zealand who are sufficiently skilled and available to work.

“Prior to Covid, New Zealand’s immigration policy was used to topup our workforce. Now we are being forced to think about how we build the workforce locally. Successful initiatives like the apprenticeship funding proves that a simple policy can be very effective as we’ve seen the largest number of apprentices enrolling for work-based learning in more than 30 years.

“But, in a longer-term view, it’s about deciding what skill-mix is best suited to deliver an agreed infrastructure pipeline. New Zealand needs a workplan that has an apolitical approach, and we need to train and develop our own population to try and get a better match with that pipeline for our country and people to grow and flourish.”

Attract, retain and train

Town points out that New Zealand organisations’ must take action to attract, retain and train their people better.

“Of all the work-based learning that is currently taking place, only 15% is what we call credentialled, meaning 85% of this work-based learning is not gaining recognised qualifications. This limits the workforce marketability at a higher skill level because people don’t have a piece of paper to show prospective employers that they are acquiring essential skills while they’ve been learning on the job.”

Adding to this, Copland says: “95% of New Zealand businesses working in construction employ five or fewer people. When we don’t have scale, how can we deliver a future-ready workforce around areas like digital capability and capacity, plus understand and respond to sustainability imperatives and train people properly?

“We need to challenge our sector around how to lift labour and productivity with low capitalisation at the firm level – how do we do this when 95% of an industry is dominated by SMEs? How do we encourage this at an aggregate level to respond to the challenges and lift productivity and do everything we need to keep the economy growing, people trained and active in our industry?”

Town believes that the solution is finding a way to attract employers to be more involved with skills acquisition and training than they are now.

“One of our roles is to find a way for employers to enjoy that experience and be better providers. There are about 25,000 employers involved in the work-based learning system in New Zealand at the moment, and our sense is that this needs to grow – but in the right capacity. For example, on-campus learning may not be required or be the most efficient way to tackle the skills shortages that we are currently facing.

“Te Pukenga is focusing on helping employees gather a lifelong learning record which has some portability and recognition in other employment settings. To achieve this, it’s important that we find the right financial encouragement. If we review the apprenticeship boost initiative – it shows how quickly you can have an impact if you incentivise employers.”

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