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As strange as it sounds, New Zealand will prepare itself for the post-Covid-19 rebuild by tackling some of the fallout from the 2008 Global Financial Crisis.
The global recession closed countless businesses and left hundreds of building sites empty. Livelihoods were lost and jobs evaporated as quickly as global markets tanked.
There were casualties just about everywhere but some of the most enduring, long-term damage was done to the flow of new workers needed to help rebuild the economy.
The nation’s apprenticeship training schemes were hit hard and struggled to recover. By 2013, there were about 50,000 fewer trainees than before the recession.
Government intervention, in the form of a $2000 bonus to new apprentices and their employers, helped stem the flow but the slump’s effects are still felt today.
They were annoyingly acute for some sectors of the otherwise booming southern economy well before the business-imperiling response to the Covid-19 pandemic.
From the residential subdivisions on the Taieri Plain and in Central Otago, to the engineering firms and milk factories in Waitaki and Southland, skilled workers were needed just about everywhere. Demand for goods and services was hardly a problem; the problem was finding people who could do the work.
Skills shortages were a handbreak to growth, then — and they may threaten the pace of the recovery, now. New Zealand did not immediately capitalise on its last recovery, and it cannot be found wanting when it fights its way out of what could be the most significant downturn since the 1930s Depression.
The Government’s new trades and apprenticeships training package, announced in last month’s Budget but detailed further this week, must be considered through this lens.
On one hand, elements of the $1.6 billion spend can be considered another tranche of the social support offered to people who lose their jobs because of the pandemic. Retrained, they will be ready to move to where their prospects are better to both add to the recovery and reduce the additional Government support they need.
On the other, providing new opportunities will finally tackle skills shortages in many areas capable of the most growth. Applied well, and reviewed next year to make sure the right sectors are targeted, it could train the workforce needed for a years-long Covid-19 recovery.
The $320 million training fund will make apprenticeship training, and courses and training for a suite of targeted industries, free. Trainees may save between $2500 and $6500 a year, and start work without the student loans that might once have stopped them completing their apprenticeships.
The South stands to benefit from a targeted industry list that includes many of the sectors previously hampered by access to good, skilled staff.
Agriculture, construction, manufacturing, engineering trades and road transport are on the list, as are social services such as perennially understaffed elder care and youth work.
But the most significant, short-to-medium-term impacts may be felt from the $412 million allocated to support employers to retain, and keep training, their apprentices. Details of that spend have yet to be released, but it is hoped such a subsidy would further insulate trainee jobs as employers cut their cloth ahead of a potentially difficult time. Jobs, and long-term career prospects, may be saved.
Master Builders Association Southern region spokesman Allister Saville this week suggested the changes could reverse the previously necessary trend to employ, and then retrain, overseas-trained staff. Now, apprentices would be available and less expensive to train.
The slip that started with the apprenticeship ‘‘reforms’’ of the early 1990s, and was exacerbated by the Global Financial Crisis, may finally be addressed.
Otago Polytechnic and the Southern Institute of Technology are expanding their trades training programmes to reflect the Government spend and, crucially, what is happening in their region.
The South had lost more than 4300 jobs by the end of the month, and more will follow when the first round of the wage subsidy payments comes to an end. The region needs to be ready to support them into work, and into vocations that will grow a more secure future.