The Pipeline of Potential
- Emma Godwin
One hallmark of a successful economy is its ability to connect employers seeking staff with individuals seeking work. Our labour market should provide businesses with a pipeline of potential – hence this report’s title. Too often, however, this connection is missed. In good times, firms struggle to find suitable and highly skilled staff. And jobseekers are poorly supported by a system that invests roughly half as much in them – in training, pastoral care and other welfare-to-work schemes – as the typical developed country would. The pipeline of talent, in short, remains blocked.
The damage this does to the New Zealand economy is significant. Companies struggle to reach their potential; productivity is reduced; talent is left unused. The unemployment rate and the benefits bill are both larger than they should be, and too many people face economic exclusion.
These problems would be serious at any point in history, but are all the more so now. Forces like climate change and AI are redrawing the map of the workforce, removing jobs while creating opportunities. Unless New Zealand rapidly learns to make better use of the talent at its disposal, and builds a system capable of responding to this disruption, our economy will continue to struggle in the twenty-first century.
Fortunately there are investments – in training, wage subsidies and other jobseeker supports – that could be the building blocks of a new, more dynamic economy. These schemes connect employers with jobseekers, enhance the latter’s skills and capabilities, provide firms with work-ready staff, and boost employment and incomes. A strategic use of these investments could unblock the pipeline of talent and, in so doing, unlock the potential of Kiwi firms held back by a lack of skilled staff.