Skills and Labour for the Canterbury Rebuild and

RecoveryA Presentation to the Built

Environment Skills Strategy (BESS)

• More than 10,000 earthquakes have occurred since the first 7.1 magnitude earthquake struck Christchurch on 4 September 2010

• 22 February 2011 earthquake resulted in 185 fatalities and caused widespread damage

• Recovering from a natural disaster on this scale in New Zealand is uncharted territory for individuals, communities, businesses, councils and government

• Successful recovery requires leadership and partnership between central government, local government, Te Rununga o Ngai Tahu, NGO’s, communities and business

Setting the Scene

4.35 am 4 Sept 2010 26 Dec 2010

12.51 pm 22 Feb 2011 2.20 pm 13 June 2011

• More than 70% of CBD buildings severely damaged• 124 kms of water mains and 300km of sewer pipes

damaged• 500,000 tonnes of liquefaction silt removed• 600 kms of roads seriously damaged• 50,000 road surface defects• 55% of secondary students sharing with other schools• 13 out of 36 hotels operating• $25b - $30b estimated cost• 185 lives tragically lost• 459,000 EQC claims (104,000 closed; 355,000 open)

Consequences of the Earthquake

• 1,500 workers fixing roads and the three waters

• 100% of the city has normal reticulated water access

• 100% of the city has normal kerbside waste services

• 100% of the city has access to functioning sewerage, chemical toilet or portaloo

• 92% of parks open• 11km of large diameter pressure

mains replaced• $3.33b paid and 23% EQC claims

closed

• 600 11kV power cable faults - now repaired

• 600+ people in the CBD red zone every day

• 1,320 buildings demolished, out of

1,609• 180,000 homes in green zone

• 7,779 residential red zone properties

• 6,491 red zone owners have purchase offers

• 5,834 homeowners have signed S&P Agreements

• 37 zoning decisions remaining

Progress So Far

• A futures model has been developed that considers the work generated by the rebuild and also the on-going activity of the regional economy

• It is important to remember……

The model shows the consequences of a defined scenario – it DOES NOT

predict the future!

Understanding the Need

• Originally developed to understand the implications of workforce growth / decline as a result of economic changes.

• Adapted following the September 2010 earthquake to understand the implications of the earthquake on the local labour market.

• Now informing our understanding of the dynamics of the rebuild and when labour may constrain the pace of rebuild.

Model History

• Insurers• Project Management Offices• Construction Sector• Government• Developers• Community

Developing the Intelligence

Central City Blueprint

• The total cost of the rebuild, based on current estimates is around $30bn

• Approximately this equates to– Residential – 40%– Infrastructure – 10%– Government – 10%– Capital Assets – 10%– Commercial – 30%

Scale of Demand

• There is still a large degree of uncertainty in the marketplace– When will the rebuild really get underway?– How big will it get?– Will insurance continue to cause delays?– Can we really find all the workers we need?

• The outputs of the model are de risked by applying a range of scenarios that give the most likely consequence of future demand.

Operating in a dynamic environment with little certainty

• The earthquakes have had an effect on the normal activity in the region.

• Normally the workforce undertakes this BAU activity

However• Things have changed• Normal activity is not what it was prior to the

earthquakes• There is lots of new activity as a direct or indirect

effect of the earthquake

Business As Usual

% of BAU TimeframeResidential New Build

60% -

Residential Repairs 0% -

Commercial 30% -Infrastructure 20% -

Consensus Scenario

Construction Labour Requirements for Rebuild Activity

% of BAU TimeframeResidential New Build

60 + 2 years

Residential Repairs 0 + 2 years

Commercial 30 + 2 yearsInfrastructure 20 + 2 years

Delayed Rebuild Scenario

Construction Labour Requirements for Rebuild Activity

Proportion of demand met by relocating

2% scenario 5% scenario 7% scenario 10% scenario

19% 35% 44% 55%

Labour Supply

Proportion of demand met by relocating

Occupation

2% scenario

5% scenario

7% scenario

10% scenario

Carpenters and Joiners 5% 12% 16% 23%

Painting Trades Workers 7% 17% 24% 34%

Concreters 3% 6% 9% 13%

Other Miscellaneous Labourers 100% 100% 100% 100%

Plasterers 5% 14% 19% 27%

Bricklayers and Stonemasons 6% 14% 20% 28%

Wall and Floor Tilers 6% 14% 20% 29%

Building and Plumbing Labourers 25% 62% 86% 100%

Plumbers 13% 34% 47% 67%

Truck Drivers 100% 100% 100% 100%

Electricians 18% 44% 62% 89%

Roof Tilers 9% 23% 33% 47%

Additional Workforce for Rebuild - Unconstrained and Constrained by Accommodation Availability

(6,000 annual)

Additional Workforce for Rebuild - Unconstrained and Constrained by Accommodation Availability

(4,000 annual)

Additional Workforce for Rebuild - Unconstrained and Constrained by Accommodation Availability

(3,000 annual)

• A joined up approach between government, iwi, business and the community to overcoming systems issues in the Greater Christchurch labour market.

• A plan that puts the aspirations of business at the core of what we are trying to achieve.

• A once in a lifetime chance to do something a little different – to apply acceleration to usual market forces.

Labour Market Recovery Programme

• Labour market fragmentation• Government agencies were previously uncoordinated

– At a local level provision is heading in multiple directions– No one was looking at the big picture

• Some macro conditions are not helpful– Population loss– Wage inflation– Marginalisation of disadvantaged groups

• Some sectors will not respond effectively to market needs

Why Do We Need One?

• A consolidated and coordinated plan• A vision that provides direction• Leadership• Clear integration between business need and

central government policy• Efficiency gains in funding interventions• Appropriateness of response

What Will Be Achieved As A Result Of The Programme?

Priorities: – Attracting and retaining skilled and talented

people in Greater Christchurch– Developing skills and capabilities– Engaging disadvantaged and unconnected groups

into work– Enabling better linkages between schools, tertiary

providers and businesses– Assisting businesses to achieve improved skills

utilisation and labour productivity gains

The Strategic Response

– Agribusiness– Knowledge Intensive Manufacturing– ICT– Professional Services– Health– Construction

Priority Sectors

• Flows out of the Recovery Strategy and the Labour Market Recovery Programme

• Industry-led, and about what industry can do• Sector leaders group met twice to discuss

issues and options (MBIE as scribe)

Construction Sector Workforce Plan

• Considerable uncertainty about when the rebuild will accelerate

• A lack of collaboration and coordination resulting in inefficiencies, which raise costs and compound uncertainties

The Burning Issues

1. Clarifying the scale of the additional labour demand2. Principles of Cooperation3. Better Information4. Establish a Good employer Scheme with a Training

Commitment5. Skill shortages6. Social issues7. Health and Safety8. Accommodation9. Quality of workforce10. The Licensed building practitioner scheme

Key Themes

• Very keen to hear ideas of industry led initiatives that will make a difference

• Plan will be posted on the Canterbury Employment and Skills Board website at the end of next week – www.cesb.org.nz

• Feedback directed to Nick Montague at the Ministry of Business Innovation and Employment – by 1st February 2013

How Can You Engage With the Plan?

The Canterbury Skills and Employment Hub

Skills Hub Website

• Hub now open for business• A number of ways to contact the Hub:

• 0800 Canhub• Email: Canty_skillshub@msd.govt.nz• www.opportunitycanterbury.org.nz• Visit by a Skills Broker

• To be evaluated for applicability to rest of New Zealand

Contacting the Hub

Sourcing Labour – An Immigration Response to the Canterbury Rebuild

• Used where:– you have not yet located a candidate, and/or – you have more than one position vacant

• Employer applies for ‘approval in principle’ to recruit workers from offshore.

• When approved, employer has confidence that can bring in the people needed for the job.

• Immigration NZ are now referring interested employers to the Canterbury Skills and Employment Hub to check if there are any suitable New Zealanders available.

Approvals In Principle

• Revised early November 2012, live on Show Day• Thirteen occupations added:

• Note that these are skilled jobs at ANZSCO 3, with qualifications and/or experience

Solid Plasterer

Painting Trades Worker

Wall and Floor Tiler

Fibrous Plasterer

Brick Layer Carpenter Roof Tiler Joiner

Glazier Floor finishes Stonemason Drain layer

Carpenter and joiner

The Canterbury Skills Shortage List (CSSL)

• Immigration NZ can provide you with support offshore

• The London-based marketing team is responsible for putting skilled UK/Irish/Dutch migrants in touch with NZ employers and recruiters. We do this in three ways:

1. Attending events in UK and Europe 2. Supporting NZ employers and their recruitment agents when they

are in the UK 3. Providing a web-based forum for NZ employers to meet skilled UK

migrants.

• The London branch can be contacted by e-mail at: ian.riddle@dol.govt.nz

Offshore Marketing and Recruitment