NZ firms with lean workforces will struggle if Omicron hits

Dileepa Fonseka is a Stuff writer covering business and politics.

OPINION: Companies are scrambling to figure out how they will be able to cope with Omicron better than other countries have. So far, things are not looking good.

The problem isn’t so much the variant itself as the way it is taking out huge chunks of the workforce, a characteristic that has seen it labelled “the big sick” by some.

In the United Kingdom they call it the “pingdemic” – named after all the people being put into isolation when their Covid-19 app pings at them to say they have been in contact with someone who has the virus.

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It has taken out a quarter of the workforce in industries like rubbish collection, which most people think very little about, until the rubbish bags pile up.

Ia Ara Aotearoa Transporting New Zealand​ chief executive Nick Leggett says his members are not just expecting shortages and delays from truck drivers getting sick, but from the unpredictable effects of staffing shortages within government departments.

To keep trucks and freight flowing, vehicle warrants need to be current, and forms need to be signed off.

But of course, a lot of the disruption will still come down to a shortage of drivers, something which has been a problem both internationally and here, even before Omicron.

“The thing is, driving a heavy vehicle is not just something you can jump into the cab and away you go. It’s a skilled job,” Leggett says.

For Migrant Workers Association president Anu Kaloti, the panic around Omicron, and how we will cope with it, has a whiff of lost opportunity about it, mixed in with a sense of pointlessness.

Kaloti has been advocating for migrant workers locked out of the country, who have valid visas but no rights to be let back in.

Other countries, such as Canada and Australia, have allowed their temporary workers to come back little by little. But last year Kaloti told me some of those migrants waiting to return here are facing awkward questions from their families about whether they are just making up this whole “closed borders” thing.

As migrants in places like India and the Philippines have started packing their bags to head back to Canada and Australia, temporary migrants to New Zealand have not even been eligible to put their names in a lottery to return.

In the grand scale of things, these workers are not a massive chunk of our workforce, but they are an important one, because they are willing and able to move to regions most New Zealand-born workers could not be paid enough to live in. Some have been in the employ of some companies for many years.

Kaloti has never asked that they all be let in at once, just in dribs and drabs as managed isolation rooms have gone empty.

It is one of the funny myths of the pandemic that managed isolation facilities have always been full. In fact, there have been long stretches of time when rooms have been half-unfilled, even before cohorting was introduced.

The lost opportunity part is because the country is now bracing for a phase of the pandemic when we will really begin to feel their absence.

As Leggett puts it: “If you think about the migrant labour force that we need, or the returning labour force that we need, those people are the people that keep the country going as well.

“The idea that we’re keeping them out because we don’t want migrants taking our jobs – well, newsflash, we’ve got more jobs than people.”

There seems to be no way of avoiding many of the disruptions from Omicron unless you have lots of people to pick up the slack.

Almost all the solutions to keeping businesses running smoothly rely on a padded-out workforce, including ones which have workers operating on shifts with little contact with each other.

Even countries with larger labour forces, and greater access to rapid tests, have struggled, and companies in those countries have been piling on the pressure to get their workers back to work as soon as possible – even if they are still sick.

Understandably, Council of Trade Unions president Richard Wagstaff is keen to avoid such pressure being heaped on workers here, which he sees as cutting corners on safety.

For years, unions have advocated for an approach where companies aren’t just run with super-lean workforces to satisfy the shareholder demands of today, but are resilient for the future.

In the same breath they have also been critical of the migration “tap”, a criticism Wagstaff largely sticks by, even if he also believes there is “absolutely a place for migrant workers”.

The experience of Covid-19 has taught a lot of companies they no longer want lean labour forces and supply chains. Unfortunately that lesson may be arriving too late for many in both government and the private sector.