Link Business

Businesses for sale

Browse All

Restaurants, Cafes and Bars Fear Future Struggles in Light of Immigration Changes

A recent post detailed New Zealand immigration changes businesses can expect to see in 2017. While changes to the skilled migrant category and temporary migrant rules will potentially impact business across all industries, the accommodation sector is especially sensitive to the changes. Within the niche, owners and managers of restaurants, bars and cafes are especially fearful that the new rules will make it even harder to keep appropriately skilled staff.

While some jobs are on the skills shortage list, including qualified chefs, allowing restaurants to hire migrants at a lower remuneration threshold without impacting visa points, other changes create challenges to maintaining consistent labour.

Reliance on Migrant Workers

With over 29,000 business and skilled visa applications in 2015/16 alone, it's obvious that New Zealand as a whole relies heavily on immigrant labour. Some point to this as an issue for New Zealanders, saying that local residents are being passed over for jobs in favour of migrants.

The reality in the accommodation sector, however, is that there aren't usually enough local workers with the right skills, and that's even more true in restaurant and bar situations. Specialists, such as sushi chefs, take years to hone their skills, and many locally skilled workers chose to move offshore and work elsewhere. The result is a skills shortage, which is one reason the government must make allowances for filling SSL positions at lower annual pay.

Restaurants and cafes aren't just looking for highly skilled workers, either. They need employees with very specific skills. A qualified sushi chef isn't necessarily the right person to work on a clay oven, creating traditional Indian cuisine. If it becomes harder for accommodation businesses to source from a wide range of immigrant applicants, New Zealand establishments may have to stop serving as many options to patrons.

Diversity isn't just beneficial to the menu. Across the entire tourism and hospitality industry, immigrant workers allow accommodation businesses to cater to a wide range of cultural and language needs.

Currently, some restaurants report that three-quarters of their workers are migrants. One owner of a group of eateries notes that his workforce is only 30 to 40 percent migrant, but that his business worked hard to develop local workers so they would have the right skills. It's not something that every restaurant can do, and it takes time to achieve even for those with the ability and desire.

Challenges in Hiring Migrants or Renewing Visas Could Slow Development

Some in the restaurant sector are worried that immigration changes could lead to slowing development in the niche. Without enough skilled workers to run front of house or kitchen processes, restaurants can't meet the needs of patrons in a timely, high-quality way. Businesses that try could risk poor reviews and a downward trend in numbers.

Hiring migrants isn't the only challenges for accommodations businesses. Renewing visas is already an obstacle, and proposed changes, which include a stand down period between three-year visas for lower-skilled jobs, might make it even more of a challenge. Restaurant owners are worried they'll run into problems keeping qualified, happy workers on staff because those same workers can't stay in the country.


For further information about this article, contact your nearest LINK Business Broking office at: