November 4, 2022

Skilled Migrant Category Reopens for Business: What Is the Future of This Category?

While the Skilled Migrant Category reopens under current settings, NZ Government has proposed new changes to help attract more skilled migrants long-term.
Skilled Migrant Category Reopens for Business: What Is the Future of This Category?
Skilled Migrant Category Reopens for Business: What Is the Future of This Category?

NZ Immigration's minister, Michael Woods, announced that the Skilled Migrant Category (SMC) visa will reopen under current settings while the consultation is underway regarding the proposed changes, like introducing the new 6-point system.

"We are resuming the Skilled Migrant Category under the current settings to help attract more workers. The first selection will be at 160 points, and subsequent selections at an increased threshold of 180 points, to better align with the future direction of the category and our rebalance goals."

What Is the Skilled Migrant Category?

The Skilled Migrant Category is a residence pathway for migrants holding skilled job offers from New Zealand employers. Under this category, it awards migrants with points based on their education, work experience, job offers, and personal attributes. The points are compared against a 'Pass Mark'.

Learn more about the category and its residence pathway in our Skilled Migrant Resident visa guide.

The Current Skilled Migrant Category Process

Before the Skilled Migrant Category closed to migrants worldwide, this was considered a two-stage process and will be retained for the meantime until the Government's proposed changes are accepted.

First, applicants submit an Expression of Interest (EOI) and include their points.

Then, INZ draws from all the applications with sufficient points to meet the current threshold of 160 points. 

Lastly, after the initial assessment, INZ sends the submitting applicants an invitation to apply for residence under the Skilled Migrant Category.

How the Points System Works

Until INZ makes any further announcements about the Government's proposal, applicants can claim points for the following:

  • Formal skills that are assessed and align with skilled work experience and qualifications.
  • A job or job offer that meets the median wage or above and fits INZ's definition of 'skilled'.
  • Bonus points for various factors relating to the ability to settle easily or to contribute to other policy objectives, such as working in less populated areas, studying in NZ, and having a skilled partner.
  • Age, with older applicants being able to claim fewer points due to their ages. The maximum age is 55 years.

What Does Rebalancing the Skilled Migrant Category Mean?

The Government is rebalancing New Zealand's immigration system by implementing a shift in the future migrant workforce to increase New Zealand business productivity and rebalance the skills gap to support our economy's growth.


The Reason for Government's Proposed Changes

Before the borders closed, INZ noticed various issues within the Skilled Migrant Category.

Global Skill Shortages

"As the world recovers from COVID-19, labour shortages continue to be a global symptom," Michael Wood stated.

Attracting migrants to New Zealand can be a challenge due to its location and its job opportunities. New Zealand employers are fighting with the likes of Australia to attract talent, as the cost of living and lower wages often detract migrants from our shores.

INZ has proposed new changes to help support a lift in the overall economy. However, this will take time to remedy. Increasing wages to attract top talent lies in the private sector's hands. Some businesses will be able to afford this investment, whilst others will rely on a lower-skilled workforce for the time being. 

While many NZ businesses have gained Employer Accreditation and can support overseas workers with the addition of the Accredited Employer Work Visa (AEWV NZ), the issue still remains. 

The Government hears the concerns of businesses as they continue to find it challenging to recruit internationally in this constrained labour market. More help is needed to help attract more highly skilled applicants, relieve labour shortages, and ensure a competitive edge to attract talent to New Zealand, hence the proposed changes being submitted for consultation.

Increase In Low-Skilled Migrants Becoming Eligible

Many migrants with limited training or experience became eligible for the Skilled Migrant Category. This is inconsistent with the new objective of granting residence to people who can fill long-term skill needs.

The new points system increase is seen to provide a high-value, sustainable migrant population. 

Extensive Backlog of Eligible Applications

A significant backlog of eligible applications and long wait times for decisions because the number of eligible applicants significantly exceeded the places available, and many applications were complex to process under current settings. 

For example, in 2019, only around 40% of all eligible applications were processed and approved. With a high level of applications, there was significant uncertainty for migrants about when and if they would be granted residence. 

Highly Populated by Migrants Without Residence Pathways

There was an increase in the population of migrants who had become well-settled in New Zealand but did not have a realistic pathway to NZ residence. Settling without the rights and protections of residence creates various risks for the migrant. 

What Are the Skilled Migrant Category Proposed Changes?

The Skilled Migrant Category was essentially the main visa for residence in NZ. The overarching objective is to support New Zealand's economic growth by attracting people with skills to fill identified long-term needs and who can deploy those skills in New Zealand through residence.

However, it closed to new applications in April 2020, when the NZ border closed in response to the Covid-19 pandemic. With the proposal, INZ is not attempting to change the objective of the category but instead aiming to ensure it's meeting its objectives and addressing the issues seen pre-Covid.

Skilled Migrant Category Reopens

INZ announced the reopening of the Skilled Migrant Category in October 2022. The Skilled Migrant Category (SMC) visa was reopened and resumed (under the same settings previous to April 2020) on 9 November 2022. However, new and continuous changes are expected, as the Government's proposal has been submitted for consultation before it is implemented.

Points Threshold Increase

The October 2022 announcement included an increase in the points threshold from 160 to 180 from 18 January 2023.

Upon introducing the points system, INZ claimed it was to be adjusted regularly to manage the skill level and volume of applications within New Zealand. However, the reality was that changes have been rare.

The Skilled Migrant Category was reviewed in 2015 and 2016 and resulted in changes to the balance of points, increasing from 140 to 160 points. Therefore, the points threshold increase may support the immigration rebalance and NZ growth objective.

Simplify the Points System

INZ has proposed a simplified points system that sets a clear, fair, and transparent eligibility threshold for skilled residence.

Applicants will need at least 6 points to be eligible, which can be made up from:

  • 3 to 6 points based on professional registration, qualifications, or income. People can choose the skill category that offers the most points based on their circumstances; and
  • 1 point per year of work in New Zealand in a skilled job, up to 3 points.

Simplifying the points system will shift the focus of the Skilled Migrant Category to skills, not specific professions. Whereas the Green List is occupation-based, will likely provide better avenues, and will remain tightly focused on occupations of critical importance to the New Zealand economy. 

The minister says the new system would clarify eligibility in the long term, allow New Zealand to retain the talent brought in via the new Accredited Employer Work Visa (AEWV), and complement the Green List.

Want to Know More About Skilled Migrant Options? Get Advice From Licensed Advisers

Understanding the Skilled Migrant Category visa options and INZ's changes can be stressful, but we can help! Reach out to our experienced immigration advisers for advice and guidance on the process.

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