Higher unemployment and election year populism may be the recipe for a sharp tightening of immigration policy, according to a leading academic.
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One in 10 workers is on a temporary visa, but with jobless figures rising, immigrants and businesses may find it harder to pass labour market tests designed to give preference to New Zealand staff.
Demographer and pro-vice chancellor at Massey University Professor Paul Spoonley told Nine to Noon continued use of overseas labour would present political problems.
"The government are going to have to talk very carefully to sectors to work out where they can retrain or transfer New Zealanders, and then where they're going to have to continue to rely on migrants," he said.
"And that's going to be an interesting conversation in an election year, because there's going be some strong feelings out there in the community about why you would bring people into the country when you've got unemployment."
He questioned how quickly sectors which had become reliant on overseas workers would be able to adjust.
"Are we going to be able to move people around the labour market so those people who have been made redundant in areas like Air New Zealand, how many of those are we going to be able to shift and of course it's not simply shifting jobs, it's probably mean shifting where you work in New Zealand.
"You can envisage that they might be retrained but that's not going to occur anytime soon. It's been a bit like a drug. This country has relied on migration for population growth and there are sectors that absolutely rely on migrants for labour and skills, and how quickly can we turn off the drug supply?"
When it comes to the future and skills shortages, there will be thorny questions ahead, he said.
"How do you turn that tap on again?" he said. "That's partly a technical issue, but it's also a political issue, it's about how people are going to feel about that because I think there are going to be some very strong opinions expressed about the desirability of having migrants come in and take jobs that you would prefer New Zealanders to have.
"And I think New Zealand will be like most other countries and we're going to privilege or prefer our citizens as against migrants."
A population policy was needed to see what immigration would look like in the future, alongside initiatives to retrain New Zealanders and make them mobile, he said.
"Are you going to be able to get people in the right places? For example, take somewhere like Mount Cook - are there going to be New Zealanders who are going to want to go and live and work in Mount Cook now ... because if there aren't then those businesses - because they can't access migrant workers - are going to have a real struggle."
Immigration lawyer James McLeod said immigrants who had spent many years in education and work here were fearful of what lay ahead if their interests were pitted against New Zealanders'.
Forecasts suggested the economic downturn caused by Covid-19 may last only 12 to 24 months, and immigrants were key to the recovery and the future workforce, he said.
"On the one hand, there's going to be a need to look after New Zealanders, particularly if there's a significant increase in unemployment versus obviously the need to consider migrants and particularly the fact that longer term we will still need them to keep the economy going," he said.
