In a recent post I alerted readers to a significant rewrite of Work Visa policy for those who complete New Zealand qualifications.  Last Friday the Government rolled out the new scheme which will take effect in November.  While it was largely what we expected, there are a few interesting tweaks, too.

Focus on Degrees

To say that Immigration has “tightened the rules for foreign students”, according to the NZ Herald, is an oversimplification.  It is true that people planning to do a sub-degree course lose the ability to apply for a 2-year Employer Assisted Work Visa, and are reduced to a 1-year “Job Search” visa to allow them to look for work.  However, those who commit to a Bachelor’s degree or higher will in future be entitled to an open 3-year Work Visa upon completion.

That’s a distinct improvement on the current scheme which requires them to secure a specific offer of employment after the first year under the Employer Assisted visa policy.  This was leading to significant distress for people whose job offers were not deemed to be “relevant” to their qualification.  Immigration was declining these on a large scale, sometimes with absurd rationales for doing so.

Naturally enough, the Universities are pleased.  The sub-degree education sector will not be so thrilled.  They have already seen a significant drop-off in numbers of Chinese students coming in on visas.  Changes to the points-based Skilled Migrant Residence system last year have made it harder to score enough to apply.  While the Minister may deny that the Government’s policies have had much to do with the fall in demand, there is no doubt that a major driver for people coming to study in New Zealand is the promise of being able to get Residence someday.  Now, doing anything less than a 3-year degree, or a full-time post-grad course, is not going to be a very attractive option.

The Tweaks

An add-on which has now appeared since the policy proposals came out in May is an incentive for people to study outside Auckland.  They can get a 2-year open Work Visa if they do a 2-year Diploma (at Levels 4 – 6 on the NZ Qualifications Framework) – or 2 such progressively higher qualifications over a total of 2 years.  Those who can’t bear to leave Auckland will only get the 1 year.

This feeds into the Government’s stated agenda of encouraging migrants to work (and settle) outside New Zealand’s biggest city.  And it is at a time when employers in the regions are warning of serious problems in getting Kiwis to work for them.  If someone from India or the Philippines spends a couple of years studying in a given city, they’ll start to feel at home there.  Over time, friendships and networks develop.  They are more likely to look for work in the same locale, and ultimately to settle there.  So goes the theory, anyway.

There is also a nod to occupations where registration is required, which are usually professional or skilled trades jobs.  Someone working toward registration can get an additional year’s open Work Visa, even if they are based in Auckland.

There are sunset provisions built into the new policy.  For example, people who are already on Employer Assisted Work Visas can ask Immigration to remove the name of their job and employer from their visa.  This will allow them to change jobs without having to seek a Variation of Conditions, which up till now was becoming a real headache for many people in case their application for VoC was rejected.  Meanwhile, those who are currently on a 1-year Job Search visa can next get a 2-year open Work Visa.  That is truly a windfall for them.

The Acid Test

What remains to be seen is whether student migrants take full advantage of the freedom to work wherever they like.  For all its shortcomings, the present Employer Assisted policy forces people to look for jobs that are aligned with what they studied, and to demonstrate that their qualification encouraged the employer to take them on.  Without that, there is a risk that people will settle for whatever work they can find in a competitive labour market.

Almost every week we talk to those who have taken up employment in a dead-end job in order to secure the Work Visa.  They have stopped looking for better.  We have to tell them that this will not be skilled enough, or high-paying enough, to get them Residence.  And by the time we see them their Employer Assisted visa has nearly run out.  I fear that this scenario will play out in an even more extreme fashion under the new scheme.  I hope I am proven wrong.  If people can switch jobs without having to get a whole new visa, this may encourage much more upward mobility than we have seen so far.

The key is to get advice early about what is really needed to find a secure path to Residence, or face having to return home after spending years, and tens of thousands of dollars, following the dream that was sold by colleges and education agents at the start of the New Zealand experiment.

The other thing to look out for is continued exploitation at the lower end of the scale.  A migrant group has already warned that the new policy will not stop abuse by employers, as the Government hopes it will.  In my view, those most at risk are those doing a sub-degree course who only get the 1-year open Work Visa.  A year is not a long time.  The pressure will be on them to take a job which will pay their way, but must also set them up to be able to either apply for Residence straight away, or go for the Essential Skills Work Visa at the end of that year.  Getting the Essential Skills visa is harder than the present Employer Assisted visa, partly because the job must be advertised, and also because the salary being paid determines how long the visa will be (only 1 year if it pays less than $20.65 per hour).  It’s even tougher applying for Residence, where the pay must be at least $24.29 per hour, or over $50,000 per year.  There is arguably even more temptation for unethical employers to make the applicant “buy their job” – that is, pay back some of their wage under the table as the price of getting the job offer.

Again, the saving grace here is that someone caught in that situation can simply go to another job without having to change their visa to do so.  But how many will know that, or continue to fear the revenge of their employer if they leave?