The 230,000 people working in retail provide an essential service to New Zealanders.
Finding an estimated 13,000 employees for the retail sector over the next 12 months requires joint action from Retail NZ, retailers, and the government.
- Retailers currently employ 230,000 New Zealanders, around 9% of the total workforce1 and an estimated 13,000 employees to be recruited over the next 12 months. Of these 12,000 are replacements and 1,000 roles are for retail sector growth2.
- The retail workforce is diverse:
- one third shop floor, one third managers, the other third including digital and data analytics (the greatest shortage), other professional capabilities, logistics, procurement, security, and entrepreneurs
- 53% have tertiary qualifications.
- Pay and training have increased:
- the average retail wage is well above the minimum wage, and it has increased 30% over the past six years.3
- 45% of employees get regular upskilling and training opportunities.
- Retailers need fit for purpose, stable, predictable employment laws that are easy for business owners to navigate and comply with, creating an environment where businesses can prosper, and entrepreneurs can develop and grow new businesses.
- The current regulatory environment for retailers is complex with frequent changes. It includes the Minimum Wage Act, Employment Relations Act, Holidays Act, Holidays (Increasing Sick Leave Amendment) Act, Pay Equity Act, Health and Safety in Employment Act, Fair Pay Agreements Act, Parental Leave and Employment Protection Act, Human Rights Act, Matariki Public Holiday Act, Worker Protection (Migrant and Other Employment) Act, and potentially modern slavery laws.
What’s the problem?
Retailers report problems in recruiting to fill vacancies:
- The public perception is that retail jobs are on the shop floor, and that retail does not provide an exciting, rewarding and long-term career pathway. The problem persists, despite wage increases as above.
- Skill shortages persist, including in support roles such as digital and data analytics.
- Retailers’ access to talent in the skilled migrant workforce is restricted by current immigration settings which requires employers to recruit at the median wage. This wage level restricts recruitment and employment opportunities for some migrants, including young people with a range of backgrounds and skills that are not within the skilled migrant category.
- Migration of capability in both early stage and senior roles requires rebuilding internal capability or buying talent from overseas.
- Immigration New Zealand does not have sufficient resource or incentive to process visa applications quickly, such that some talent is more attracted to other countries.
- There is a cost to retailers of ensuring work readiness in the light of decreasing levels of literacy and numeracy in young employees, that is not recognised in the current starting out minimum wage.
Complexity of and frequent changes to employment legislation are creating uncertainty and costs for recruitment.
- The minimum wage has been increasing at a rate faster than growth in revenue across the retail sector. Ongoing minimum wage increases, at the same rate as over the last six years, would be unsustainable for retailers.
- The Holidays Act provisions for sick leave for part time workers have complex implications for businesses.
- Fair Pay Agreements create significant complexity and significant costs for business owners, which reduces funds available to recruit the staff they need. The retail workforce will be covered by multiple Fair Pay Agreements requiring employers and unions to negotiate minimum mandatory terms and conditions for multiple sectors and/or occupational workforce groups. These will remove flexibility for employers to agree terms and conditions with their employees that fit their specific experience and skills, and the needs of the business (while complying with other employment legislation).
What’s the answer?
If you have any questions about the Retail NZ Workforce Position Statement, please email [email protected].
Published by Retail NZ in November 2023.
1 Statistics NZ, Business Demographic Survey, to February 2023.
2 Ringa Hora 2023.
3 Retail NZ, Wages Guide 2022/23.