Photo Source: Anna Tarazevich
New Zealand businesses facing severe labour shortages are set for relief as Immigration Minister Erica Stanford announces the removal of the median wage requirement from the Accredited Employer Work Visa (AEWV). This overhaul is effective from March 2025 and is expected to ease hiring pressures across a range of industries.
A Welcome Change for Employers
The AEWV was introduced to streamline the recruitment of skilled and unskilled migrant workers to fill workforce gaps. However, the mandatory median wage requirement had created hurdles, with employers often forced to pay overseas workers more than their New Zealand counterparts.
Katherine Rich, Chief Executive of BusinessNZ, noted that the policy had been inflationary and placed businesses at a disadvantage.
“In some cases, employers were having to pay over and above local workers to do the same job, which you can imagine creates some friction as well as inflation,” Rich said.
Retail NZ echoed these sentiments, with Chief Executive Carolyn Young highlighting how the policy had particularly affected businesses reliant on minimum wage roles.
“The need to pay median wage has been a barrier to using migrants to fill these roles,” she explained, emphasising the necessity of migrant labour in sectors with limited domestic workforce availability.
Further Adjustments to the AEWV
Minister Erica Stanford announced a series of adjustments to the Accredited Employer Work Visa (AEWV).
“Earlier in the year, we made initial changes to the AEWV to get unsustainable net migration under control and reduce migrant exploitation,” said Stanford.
The changes are part of a wider push to modernise New Zealand’s immigration system and address migrant exploitation concerns. “Since then, Immigration NZ has also made operational changes and focused on upskilling immigration officers to mitigate risk, significantly increase productivity, and speed up AEWV processing.”
Additional adjustments include reducing the minimum experience requirement for lower-skilled migrants to two years, introducing new seasonal visa pathways, and increasing the visa duration for certain roles. These measures aim to enhance flexibility for businesses and provide more opportunities for migrant workers.
Strong Support from Key Industries
Industry reaction to the government’s AEWV changes has been overwhelmingly positive, particularly from the hospitality and tourism sectors.
Steve Armitage, Chief Executive of Hospitality NZ, described the median wage rule as “an arbitrary benchmark equating pay rates with skills that are needed,” praising the government for its decision to remove it. He also noted that eliminating the 21-day advertising rule would ease recruitment during high-demand periods.
Rebecca Ingram, Chief Executive of Tourism Industry Aotearoa, lauded the government’s responsiveness to the sector’s needs. “Fixing parts of the AEWV scheme is something we have advocated hard for,” she said, highlighting how these changes would benefit employers seeking skilled international workers.
Economic Benefits for Businesses
The removal of the median wage requirement is expected to provide significant relief to New Zealand businesses by lowering hiring costs and enhancing their competitiveness.
Joanna Hall, Senior Policy Advisor at the Employers and Manufacturers Association, noted that reducing compliance burdens would benefit employers. “We’d like to see an AEWV system that is well designed for all users and doesn’t impose undue compliance processes and costs onto employers,” Hall said, emphasising the need for New Zealand to position itself as a prime destination for skilled workers.
Challenges and Improvements
The recent changes to New Zealand’s immigration policies have garnered positive reactions, but some stakeholders are calling for further adjustments. Katherine Rich emphasised the importance of maintaining a well-functioning, efficient system without unnecessary barriers.
Joanna Hall also urged the government to continue refining its approach to ensure New Zealand stands out as an attractive destination for skilled migrants.
“These changes are positive steps, and we look forward to further moves by the government to help employers secure the skilled migrants that will increase the country’s economic wellbeing,” she said.