This article by Kirk Hope originally appeared in the 17 January 2022 edition of the NZ Herald (Business)
Life as we knew it was turned on its head in 2020 with the arrival and elimination of Covid-19 in New Zealand.
A year later the Delta variant sent us all back to lockdown threatening to redefine “business as usual”.
While this pandemic remains the largest issue business owners face, that doesn’t mean that leading issues pre-Covid have disappeared. The challenges we face in the new year are compound and varied.
Immigration and skills shortages, discussions around fair pay agreements as well as supply chain issues and business burnout – here’s a rundown of some of the issues which are top of mind for business owners in 2022.
Preparing for the next stage in the fight against Covid-19
Business owners will be seeking reassurance that New Zealand is prepared for the next round in the fight against Covid-19.
Currently, that means getting clarity from the Government around what is required of businesses to safely operate before the highly infectious Omicron variant finds its way into the community.
We were in a similar situation not long ago with Delta. This time we’ve been given a second (or third) chance to ensure we’re ready for a new wave of infection by including the effective tools for managing spread based on what’s worked in other places.
These are well known by now; Vaccines, testing, boosters, mandates and ventilation on top of rigorous personal hygiene practices.
Covid-19 introduced border restrictions and MIQ for travellers. The Omicron variant has further delayed plans to open the border to New Zealanders living in Australia this month. Businesses looking to recover or even stay afloat will be thinking about these settings going into 2022.
As we continue to navigate this pandemic, we can reduce risk while also enabling more cross-border travel. Business needs to know when border restrictions will be easing – as far ahead of time as possible.
Self-managed isolation is a safe and more attractive alternative to a mandatory stay in unfamiliar surroundings.
By offering it as an option to business travellers rather than everyone returning to New Zealand you have an additional safeguard built into the arrangement.
If employees enter self-isolation during a business trip, they do so as representatives of their company. Breaking isolation rules then becomes a health and safety risk for that business – not to mention the reputational risks associated with misbehaving.
There are self-isolation models being used internationally to make sure people stay put by using technologies like geolocators, mobile phones and wristband monitoring. Businesses are keen to employ these as added measures to ensure isolation can be completed safely, outside of an MIQ facility.
Immigration and skills
Immigration policy will have a significant role to play in whether we sink or swim post-Covid. While businesses might have products and services and the customers to buy them, they may not have staff with the expertise to operate effectively. New Zealand must compete for the best and brightest globally, and the war for talent has only intensified.
The current border exception process adds layers of complexity to an already struggling immigration system that does not meet the needs of business. The Government must give businesses greater certainty on their plans for the border and immigration system so that companies can plan for 2022, including when the border exemptions regime can be wound down in favour of returning to a prioritised immigration process.
The focus going forward needs to be on how to safely facilitate movement at the border to maintain New Zealand’s economic momentum – particularly as we see easing of Government stimulus and inflation pressures in the year ahead.
New Zealand had a skills shortage issue before Covid, and with record low unemployment, this is now looming large as one of the biggest barriers for business.
While it is positive to see apprenticeship rates booming and many individuals choosing to upskill in the face of uncertainty, immigration will be a critical connection to ensure skills and talent (many of which we simply don’t train for in New Zealand).
The international knowledge and networks that migrants bring with them can again be fostered to grow our export connections and assist our economic recovery.
Fair pay agreements and industrial relations policy
The discussion around fair pay agreements (FPAs) continues to be a major issue as in 2022. The implications it has for business in New Zealand cannot be overstated.
In December, Business New Zealand formally rejected the Government’s offer to be the default bargaining party for employers in the FPA scheme, stating that we will not be part of a compulsory scheme that was out of touch with modern ways of working.
Compulsory FPAs are unlawful under both current domestic and international employment laws and are totally out of step with how we need to work in 2021. They aren’t needed, they remove the flexibility and autonomy of modern workplaces and won’t improve pay and conditions for hardworking Kiwis.
Business New Zealand will continue to oppose any compulsory scheme put forward by Government.
Supply chain issues
Further to skills shortages, when Omicron and the “big sick” hits, we’re going to find ourselves in the midst of a supply chain crisis. With the infectious nature of the variant, many people will need to take time away from their jobs to isolate and recover. Gaps in our supply chain mean bottlenecks and stalling will be a recurring issue in 2022.
Many businesses will be thinking about how they can prepare for a squeeze on the supply chain, to minimise the impact and keep their shelves stocked as best they can.
Business owner and employee burnout
The past two years have been hard on us all. Business owners, particularly those who endured extended lockdown restrictions in Auckland, have put up with enormous pressure throughout multiple, extended lockdowns.
I sympathise and commend business owners who have done anything and everything in an effort to keep the lights on, customers happy and their staff employed.
Many workers and employers will be experiencing burnout as we enter the third year of Covid restrictions. Businesses and their people have endured so much stress, unknowns and countless adjustments – all of which is taking a toll on the workforce.
As we prepare for Omicron’s arrival in New Zealand, businesses understand the importance of a mentally and physically well workforce and will be seeking opportunities to maintain one.
For business owners, making the tough decision to abandon a business and find other work is a blow with far-reaching negative impacts. It’s essential they remember to take care of themselves in continued challenging circumstances.
I have an enormous amount of respect for those businesses who have gone above and beyond to support their people while doing their part to manage the spread of Covid-19 by getting vaccinated, complying with mask mandates, and providing a safe environment for staff and customers.
While these issues are top of mind for businesses in New Zealand, they aren’t insurmountable. I look forward to tackling these challenges with you, to make sure we can recover from what I’m sure you’ll agree has been a rough start to the Twenties.
Here’s to a new year full of progress, new opportunities and growing prosperity together.