The labor supply situation in Fiji has shown signs of improvement, as indicated by the latest economic analysis from the Reserve Bank of Fiji (RBF). The recent report notes that while demand for labor has lessened, the supply has stabilized, partly due to a significant 27.3 percent reduction in Fijians emigrating abroad in January compared to the previous year. This trend is attributed to tightened migration policies in Australia, which have restricted opportunities for Fijians seeking work overseas.
In addition to the decrease in emigration, the number of foreign workers in Fiji fell sharply by 66.5 percent year-on-year in January, although there was a notable annual increase of 31.2 percent in 2024. The RBF highlighted a 34.6 percent decline in job vacancies compared to a year earlier, with sectors such as community services, retail, hospitality, and manufacturing experiencing the most contractions.
This reduction in job vacancies aligns with formal labor statistics from the Fiji National Provident Fund, which reported a modest two percent annual increase in formal employment last year. The growth was primarily driven by increased registrations in wholesale and retail, motor vehicle repair, and accommodation and food services.
Fiji’s labor market challenges have largely stemmed from high migration rates, where around 25,627 Fijians migrated overseas between 2022 and 2023, the highest rate since records began. Economists previously predicted that as Australia and New Zealand enforce stricter immigration policies, the outflow of Fijians would slow down. Recent data indeed suggests that this trend is taking hold, with a 33.1 percent decline in resident departures since March 2024.
The overall labor market remains in a delicate state, with employers having expressed concerns over retaining skilled workers. In response, many have raised wages; in fact, there was a significant wage growth of 10.3 percent reported, accompanied by a 24.5 percent rise in collections from Pay As You Earn (PAYE).
Overall, while Fiji’s labor market continues to grapple with challenges, the stabilization of labor supply and tightening of emigration suggests a potential shift toward a more resilient and robust domestic labor force. As Fijian workers return to the country, there could be opportunities for growth and renewed stability in the economy. This situation could ultimately offer hope for brighter prospects for the labor market in Fiji moving forward.
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