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New Zealand tightens work visa rules

Short on time? Here are the highlights:
  • The New Zealand government has introduced new rules that will make it harder for foreign workers, including foreign graduates, to qualify for the Skilled Migrant visa category
  • This will in turn make it more difficult for foreign graduates who cannot meet the new requirements to stay and work in New Zealand for an extended period after their studies or to pursue permanent residency in the country
  • The new visa rules are expected to impact international student recruitment, particularly for those students in below-degree-level programmes

Earlier this month, New Zealand Immigration Minister Michael Woodhouse introduced a package of new rules that will tighten access to work visas for those hoping to stay and work in the country. In particular, the new guidelines introduced on 19 April, will change the way that skilled employment and work experience are assessed for purposes of qualifying for a work visa.

Under the revised scoring system for Skilled Migrant category visa applicants, greater weight will be given to skilled work experience and advanced academic qualifications, and those aged 30-to-39 will also benefit from some additional scoring for their age group.

Perhaps most notably, the new rules also establish higher income thresholds for purposes of scoring current in-country work experience as well as the offer of skilled employment in New Zealand.

Visa applicants with jobs classed at skill levels 1, 2, and 3 in the Australian and New Zealand Standard Classification of Occupations (ANZSCO) scheme will only be awarded points if they are paid at or above NZ$48,859 per year (US$33,513). In other words, those paid below that level will no longer qualify in the Skilled Migrant category.

Applicants with jobs that are not classed at ANZSCO 1, 2, or 3 will not be assessed as being in skilled employment unless they are paid at least NZ$73,299 (US$50,270).

Those who are unable to qualify for the Skilled Migrant category, but who obtain a visa for lower-skilled work in the Essential Skills category, will only be allowed to stay and work in New Zealand for a maximum of three years, after which they must leave the country for a minimum “stand down period” before being eligible to apply again for another lower-skilled work visa.

Immigration Minister Michael Woodhouse announcing changes to the Skilled Migrant visa category, April 2017.

“The Government is committed to ensuring inward migration best supports the economy and the labour market,” said Mr Woodhouse. The Minister acknowledged as well that “the Government has a Kiwis first approach to immigration and these changes are designed to strike the right balance between reinforcing the temporary nature of Essential Skills work visas and encouraging employers to take on more Kiwis and invest in the training to upskill them.”

The new policies set out this month also make the path to permanent residency more challenging and less certain for those who are unable to meet the new Skilled Migrant requirements. A recent article in the New Zealand Herald highlights the example of Kary Chung, a 22-year-old restaurant manager who has been in New Zealand for five years. Originally from Hong Kong, Ms Chung completed both her high school and degree studies in New Zealand but is concerned that her current income will not meet the new threshold for the Skilled Migrant category.

“I bring with me skills such as cultural knowledge and being fluent in Cantonese, Mandarin and of course English, which is vital in the hospitality industry here these days,” she said. “But the fact is, people in hospitality are not highly paid, and my current income will not meet the NZ$49,000 mark. If skilled employment is now being defined by how much a person earns, then it is impossible for me to qualify even if I get the top position in the restaurant.”

The new rules will come into effect on 14 August 2017. Applications submitted up to that date will continue to be assessed under the current rules.

How this relates to education

Education New Zealand Chief Executive Grant McPherson has acknowledged that the new rules are likely to impact international student recruitment in New Zealand.

“It is expected that the Skilled Migrant residency changes will have a short-term impact on international student recruitment, particularly for providers targeting students at below-degree-level qualifications, who are more likely to be affected by the changes,” writes Mr McPherson.

“The recent announcements do send a clear signal that permanent residence after three years of post-study work experience is not always a realistic expectation.”

Indeed, the changes announced this month take on a new significance when we consider that a large proportion of New Zealand’s enrolment growth in recent years appears to have been concentrated in below-degree-level qualifications. In our earlier reports on enrolment trends over 2014 and 2015, we noted, “Looking back over the last two years, most of the overall growth in foreign enrolment has been concentrated in two sectors – Institutes of Technology and Polytechnics (ITPs) and Private Training Establishments (PTEs) – and it has been largely driven in both sectors by increasing numbers of Indian students.

ITP enrolment climbed by nearly 42% over the two years, and by 23% between 2014 and 2015 alone. The PTE sector includes language schools and, while English Language Teaching (ELT) enrolment has been essentially flat over the last two years (+2% between 2014 and 2015), overall PTE numbers are up by more than 45% (including nearly 19% between 2014 and 2015). Increases in Indian enrolment accounted for just over 80% of overall ITP growth last year and about 60% of PTE gains.”

In a related development, a recent study by New Zealand’s Ministry of Education highlights that roughly seven in ten international students who complete an academic qualification in New Zealand remain in the country in the period immediately following graduation to pursue employment or further study. The study also found that five years after graduation roughly 30% of foreign graduates are still employed in New Zealand.

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