Strong Case For Mora Skilled Immigrants

Press, Volume CVI, Issue 31209, 5 November 1966, Page 23

Strong Case For Mora Skilled Immigrants

Increased general immigration into New Zealand in present circumstances would be inappropriate, says the Monetary and Economic Council’s report on “Increased Immigration and the N.Z. Economy” released today.

But, says the report, If the immigrants ' have special and . scarce skills, the case i for encouraging them 1 is very strong. 1 An introduction to the 27 ' page report says that addi- ( tional immigrants would add : to the demand for imports : jo that even if the labour 1 shortages were to be met by ’ immigration, the still more sensitive problem of the supply of imports could bei made worse. •These two kinds of unsatisfied demands for labour and for imports—must therefore be considered together,” says the report.

It points out that the employer does not have to provide the housing and the other social capital that the immigrant and his family will need. “Thus the enthusiasm of the employer (for more immigrants) is completely understandable,” the report said. The council has made an analysis of the amount of additional spending that would arise from an inflow of an extra 4000 immigrants a year into New Zealand. “For years, the effect of the immigrants would be to intensify the labour shortage rather than to ease it,” says the report on the analysis. Disparity ‘This analysis also reveals, in current circumstances, a disparity of interest between the economy as a whole and the particular employers who obtain the immigrant labour. ‘Their’s is the benefit in output enhanced, a vacancy filled, and local and direct pressure to bid up wages relieved. “But since the over-all demand in the economy will have been raised by more than the immigrants can supply, these pressures in the rest of the economy must be intensified. “It is this effect on the economy, as a whole, to which Government must give overriding attention.”

The report says that increased assisted immigration is likely in the future to yield fewer immediate entrants to the labour force in proportion to total persons assisted if, as appears probable, numbers can only be made up by taking more married men with families.

If this is so, the capital expenditure for housing involved in their establishment will be increased. Present difficulties in paying for imports needed for present employment, says the report, should be overcome before such additional demands as 4000 extra immigrants are contemplated. On the subject of increasing the flow of skilled workers, the report says that their arrival often makes possible an increase in output that may substantially exceed the demands they themselves make upon the economy. Two Cases

it says there are two kinds of cases where it appears desirable to make special efforts to obtain skilled immigrants. The first is where the skill is necessarily the product of many years of special training and where the shortage of such people is the limiting factor in establishing or expanding some important activity.

The other general case is where the numbers required to possess the important skill are too small to make it economical to set up training facilities within this country. A main conclusion given by the council in its report is that a higher rate of general immigration in present circumstances would generate further pressure on resources in the economy and would cause increased difficulties without balance of payments. “These are already the two ■ key weaknesses in the ; economy," says the report. | “Nevertheless, we see an I increased inflow of assisted

skilled Immigrants as likely, on balance, to be advantageous to the economy even under present circumstances, provided that the kind of skill they possess and the New Zealand demand for those skills satisfy certain tests of economic importance.” In a foreword to the report, in the form of a letter to the Minister of Immigration (Mr Shand), the chairman of the council (Mr E. D. Wilkinson) says that, paradoxically, immigration will confer its greatest benefits on the economy when there is no obvious labour shortage.