Government defends response to severe staff shortages as hospitality business warns industry in dire straits

The Government is defending its response to severe labour shortages after a hospitality business owner said the industry is in dire straits.

It comes as industries across the country struggle with severe labour shortages including hospitality, healthcare and agriculture.

Despite the staffing issues affecting many industries, Immigration Minister Michael Wood suggested working conditions might be to blame for hospitality's struggles.

"Employers in sectors that continue to pay low wages with insecure working conditions also need to consider what changes they will make to be genuinely attractive places to work," Wood said when asked about chronic labour shortages.

This didn't go down well with business owner Matt McLaughlin who told AM's Ryan Bridge it's disappointing. McLaughlin said the industry has raised pay significantly and put the blame on the Government, saying international workers are desperately needed.

"We work really hard in our industry and the pay rates have gone up. We're looking at about $24 average wage in hospitality across the sector and Queenstown, I'm told it's $26. So, you know, these things are moving. But there's no magic wand for us to be able to wave and say all of a sudden our industry is so much better to come and work in. It's just disappointing to hear that kind of attitude," he said.

Labour Minister Megan Woods, who was filling in for Prime Minister Jacinda Ardern, told Bridge the Government is working hard to address labour shortages.

"What we are in is actually an international shortage. I've just been overseas and New Zealand isn't the only country experiencing this," Woods said.

"We do need to be doing two things. We need to be making sure that we're doing everything to train our own workers for those jobs but we also are doing what we need to do, and that is make sure we get those Working Holiday Visas open again.

"And more than that, we've got our Prime Minister on the road expanding those schemes. We're seeing that with Spain, we're seeing that with the UK in her recent trip. This certainly is an area of focus for us as a Government… We know how important it is."

Woods said the Working Holiday Visas are open for application for the vast majority of people overseas. She conceded a few countries aren't yet able to apply but most can.

It comes after McLaughlin said Working Holiday Visa restrictions meant some people overseas couldn't even apply until next month.

"We're missing out on so many people. We need the borders to be back open. People can't even apply for the Working Holiday Visa until the borders are open next month. Then, you know, the backlog of visas is just making us really nervous about how long it's going to take," he said.

But Woods said as far as she was aware there was "no impediment" for applying for Working Holiday Visas.

"The doors are open and [we're] actively encouraging people to come to New Zealand for their working holiday," she said.

When Bridge asked whether the Minister was aware people living in certain countries can't yet apply for the visa, Woods said it was a small number.

"There are some countries," she conceded. "But the traditional source of Working Holiday Visas - the door is open for those, is my understanding."

According to Immigration New Zealand Working Holiday Visa applications are open for people in the following countries: Belgium, Canada, Denmark, Finland, France, Germany, Ireland, Italy, Netherlands, Norway, Sweden, United Kingdom, USA, Japan, Malaysia, Portugal, Mexico, Estonia, Philippines, Hong Kong, Slovenia, Hungary, Spain, Slovakia, Austria, Singapore, Korea, Poland, Luxembourg, China, Latvia, Taiwan, Argentina, Chile, Czech Republic and Israel.

Malta, Lithuania, Thailand, Turkey, Vietnam, Croatia, Peru, Brazil and Uruguay are still waiting for applications to open.