Construction and infrastructure

Labour market insights

Residential, commercial and infrastructure forecasts show a strong forward pipeline of work for the construction and infrastructure industries. This includes significant government investment to tackle the housing shortage, which is the priority for Taitokerau hapori/ communities and is reflected by Kāinga Ora priorities.

Supporting Māori-owned businesses to build warm, dry homes in Northland(external link) — Kāinga Ora website

The Taitokerau housing register is at a record high with over 1500 families currently on the emergency housing waiting list. “Since late 2017, the number of Taitokerau families on Kāinga Ora’s housing register ballooned 600%, from 234 in December 2017 to 1402 in December 2021”. Māori whānau are overrepresented in the homeless population (87% of emergency housing grants were to Māori although they make up 36% of the population).

Northland's housing crisis sees social housing waiting list soar, street living(external link) — Stuff.co.nz

Northland Region economic profile(external link) — Infometrics

Government is also planning investment in large infrastructure projects across Taitokerau, including the Whangārei and Kaitaia Hospitals upgrades, Northport upgrades and Northland Transportation Alliance projects28. There are also a significant number of private sector developments; for example, Arvida Retirement Village in Kerikeri. Waka Kotahi’s New Zealand Upgrade Programme for Transport29 also outline significant construction projects in the coming years. “The Northland package will provide a new rail link to Northport, upgrades to the rail line north of Whangārei and targeted major safety upgrades to State Highway 1 to help everyone get where they’re going safely.”

Te Waihanga Projects(external link) — Te Waihanga website

Northland package(external link) — Waka Kotahi website

COVID-19 has highlighted the weaknesses across this sector with material supply chain issues only adding further strain on a sector already struggling with both skills and labour shortages. New building practices and technologies are an opportunity to bring new workers into the industry and grow productivity e.g. increased use of panel construction housing techniques to reduce build time and increase productivity.  

Another unfortunate consequence of the skills shortage is employer poaching. “COVID-19 has highlighted the weaknesses in the system. Fewer apprenticeships and staff shortages have led to organisations poaching from each other which isn’t sustainable. We need to invest in paying people a decent wage, and we employers need to recognise the importance of a positive transition into the company.” says Stuart McDonald, GM People and Culture at McKay.

Because of all the growth there is demand for new development and regulatory skill sets; namely surveyors and environmental consent teams. The members have heard from district councils that there is high turnover and staff poaching which is unsustainable and only works to further exacerbate the associated bottlenecks with resource consents and building inspections.

In 2020 there were 11,514 workers in the sector representing 15.1% of the total workforce (76,175). This is a higher proportion of our regional workforce than most regions nationally.

Northland Region economic profile(external link) — Infometrics

Unclear pathways are exacerbated through a distinct lack of diversity across the sector – many organisations are changing their culture to attract a range of workers while some still have a way to go. For example, women represent 13% of the workforce (3% of apprentices) and only 26.5% of the workforce are Māori, compared to Māori making up 36% of the region’s population.

Women in Construction(external link) — BCITO

Northland Region economic profile(external link) — Infometrics

Unlike other sectors in Taitokerau, there is a high percentage of self-employed contractors which is a characteristic of the sector - 4,316 were self-employed workers in 2020. Larger firms typically have the capacity and structures to better support innovation in workforce and skills development.

Residential, commercial and infrastructure forecasts show a strong forward pipeline of work for the construction and infrastructure industries.

What are jobs and skills in the sector?

The sector recognises a range of workforce and skills challenges. There is a severe shortage of workers. Taitokerau needs over 4,000 workers to enter the sector over the next 5 years, to replace those leaving the industry and meet increased demand. This represents an increase of 33% from the 2020 workforce (11,500 workers).

There is huge demand for housing across the region, in addition to the proposed infrastructure projects.

At the moment we know the sector requires:

• Carpenters and Skilled Labourers.
• Certificate level 1-3 – over 1100 replacement jobs – circa 150 new jobs.
• Certificate level 4 – over 1200 replacement and 170 new jobs – total 1,370.
• Diploma Level 5 + 6 – 270 replacement and 170 new jobs – total 420.
• Degree level 7 plus – 500 replacement and 400 plus new jobs – total 900.
• Project builders
• Electricians (general).
• Project Managers.
• Resource consent expertise.
• Licensed (class 1-5) drivers.

In addition, new industry opportunities are emerging. Initiatives such as water infrastructure as well as alternative energy projects including solar farms are currently being established across the rohe. All of these projects will require a workforce with the skills for initial construction, and ongoing maintenance. The members want to identify the wider range of skills that will be required, especially in remote, papakāinga communities. The Maihi-Ka-Ora report highlights the need to remove barriers for building more papakāinga housing.

MAIHI Ka Ora – the National Māori Housing Strategy(external link) — Ministry of Housing and Urban Development

There is an opportunity to amplify initiatives to attract taitamariki, Māori and wāhine into the industry by pertinent subject choices at schools which support these pathways. Collaboration with Waihanga Ara Rau and Te Pūkenga is needed to ensure such subjects are available to students across the rohe.

Alongside growing the local workforce, industry leaders in the region will need to attract experienced people from other regions, or from offshore, to support the development of the future workforce.

Because of the significant workforce growth required we need skills at all levels from entry level to professional. There is real employer commitment to growing the local workforce as the sector recognises the severity of the shortage in the coming decade. Alongside growing the local workforce, industry leaders in the region will need to attract experienced people from other regions, or from offshore, to support the development of the future workforce.

Rick Lunn, Director at Smart Trade Solutions Ltd explained, “A major bottleneck is the lack of experienced, qualified, skilled tradespeople to coach apprentices in the workplace. Opening borders is only going to be a short-term solution. We need to upskill and keep local people.”

The clear opportunity is to grow the Māori workforce, and Māori construction and infrastructure business ownership, so that communities across the region can not only address the housing shortage in their neighbourhoods but also retain the skills to build and maintain their housing. Māori owned businesses employ 43% Māori on average, which is 3x the rate of non-Māori businesses. Increasing contracts awarded to Māori businesses through social procurement is an excellent opportunity to grow a skilled Māori workforce. Culturally appropriate care must be put into place as per the Mātauranga Māori Framework underpinning this plan.

Thousands of Māori businesses revealed through research(external link) — Te Puni Kokiri

“Māori businesses are committed to developing their workforce. One of Amotai’s roles is to support buyers (government agencies, corporates, local council) to understand their ability to make change through their actions – to create equitable opportunities for underrepresented groups while expanding their supply chains. Intentional procurement for positive change. Supporting sustainable long term behavioural change of our buyers by including local Māori and Pasifika businesses, promotes business resilience and enables them to upskill their workforce skills and capabilities”.

– Missy Armstrong – Amotai

“Kāinga Ora is investing in Taitokerau in multiple ways. In doing so we seek to support the local economy by contracting local businesses, promoting trade training and contracting schools to build homes. We work with Amotai to support businesses [to] become ready to contract with us. Dargaville High School students have built a number of homes for us, including an accessible five bedroom home recently opened in Kaitaia. We are proud to be a part these young people’s mahi hikoi”.

– Jeff Murray Regional Director, Kāinga Ora Taitokerau

The Government’s social procurement policy now requires that 5% of contracts are awarded to Māori businesses, to increase supplier diversity. Kāinga Ora is committed to meeting the government’s social procurement target of 5% Māori businesses and believe this percentage can be significantly higher in Taitokerau. They are also partnering with hapū, and selling them relocatable homes to bring up to legal standards.

The members want to support Iwi-hapū led workforce development in line with social procurement for government investment in housing and infrastructure. Kāinga Ora are actively seeking partnerships with hapū and iwi to develop and upgrade housing stock, however the lack of infrastructure capacity can be a barrier. An example of a successful programme is Māori business Yakkas Construction who have won a tender to build 6 state homes in Kaikohe.

Supporting Māori-owned businesses to build warm, dry homes in Northland(external link) — Kainga Ora

By the same token, if employers do not want to repeat the mistakes of the past, they need to commit to growing the capacity of their current workforce. We expect this will be easier going forward as tertiary providers are now providing a range of study options that allow learners more flexibility.

What are the labour market gaps?

The top 5 detailed occupations in Northland Region are expected to account for 26% of all job openings between 2021 and 2027. Replacement job openings for these are expected to make up 22% of overall job openings in this sector. The members see this as an excellent opportunity to attract taitamariki as well as wāhine into the sector and broaden the sector’s diversity while also increasing capacity to meet demand. To do so, it is essential that a range of accessible training across the rohe is made available.

The Group wanted to understand construction and infrastructure workforce and skills needs so we consulted workers, and employers, and education/ training providers from across the rohe. Since September 2021, this collaborative approach has seen the Group provide support to a range of initiatives including:

• BCITO hui in Kaitaia, Kerikeri, Kaikohe and Whangārei where over 20 representatives came from tertiary education providers, businesses, and agencies to discuss the challenges, opportunities and potential solutions.
• Over 20 key informant interviews with industry employers from right across the region for research commissioned by the Regional Public Service Commissioner, to support the regional public service strategy (He Orana) focus on housing and workforce development. The interviews were conducted by the Ministry of Social Development, Northland Inc, and NorthTec, to support an immediate response.

“We need to wrap pastoral care and support around people as they start their apprenticeship journey, not wait until they fall off the cliff. As an employer it is easier to deal with a small problem than try and solve a big problem at the bottom of the cliff when everyone is hurting.”

– Rick Lunn; Director, Smart Trade Solutions Limited

“Our younger whānau within our communities have said they prefer employment opportunities where they can earn and learn at the same time and the reasons are obvious, but the genuine opportunities are still too few.”

– Annie Tothill, E Tu

Taitamariki have a poor perception of the industry and those interested generally have to travel to Whangārei for up-skilling. Provision for local training and earn as you learn will enhance the reputation.

Pastoral care in this sector can be improved to reduce worker churn and increase productivity, especially if it is aligned to cultural beliefs and practices. Having a stronger connection to schools will increase understanding of both employers and youth, as well as teachers about what the sector can offer. Civil Contractors New Zealand (CCNZ) have an initiative to address this, discussed below.

Developing a skilled civil construction workforce [PDF 1.8MB](external link)

Another key barrier for both taitamariki and employers are driving licences. Workers struggle to get to where the work is, and employers can’t support workers to upgrade their licences to meet the demand for class 2, 4 and 5 licence holders across the sector. The members are in support of initiatives to increase access, while secondary schools are investigating provisions. Far North REAP  deliver driver licence support services, with MSD and Waka Kotahi collaborating. As Hon. Minister Damien O’Connor stated: “Increasing rural community access to driver licensing training will open up more job opportunities by equipping our rural people with skills sought by many employers.”

AA driver and vehicle licensing(external link) — Far North REAP

Government backs rural driver licensing support programme(external link) — Beehive website

The top 5 detailed occupations in Northland Region are expected to account for 26% of all job openings between 2021 and 2027.

The general perception of the sector is outdated, with the view that it is currently male dominated. As with taitamariki, wāhine/women view the sector as having long and inflexible work hours, unattractive work culture and site hygiene factors, and requiring physically demanding activities. The members support clarifying pathways to attract more wāhine and young people into the sector. Civil Construction New Zealand continue to address this with their recently released plan citing industry-wide programmes like Women in Trades, Girls with Hi-vis and Women in Infrastructure.

Developing a skilled civil construction workforce [PDF 1.8MB](external link)

“Work has the potential to add a great deal of meaning and richness to our lives; at the same time, it has the capacity to wither our souls in a way that few other life activities can match.” Members have notes that mahi perceived as adding purpose and meaning, and contributing to Kaupapa, is attractive to people. This combined with the ability to access training regardless of location will increase the sector’s attractiveness to workers.

The Perception Barrier to Construction Careers(external link) — Concove website

"If you want to just come and dig a hole – go elsewhere. If you want to have a purpose, come and work for us." 

– Ida-Jean Murray, North Drill Limited

< Our region's workforce | Construction and infrastructure >