Four-day weeks, social outings and weekends away are among benefits on offer from companies competing for workers in a tight labour market.

Photo: RNZ / Tom Furley

Unemployment fell to 4.9 percent in the first three months of the year, while the number of people in work has risen by 29,000.

The construction, food and accommodation sectors accounted for more than half the growth in jobs.

Analysts said the fall in unemployment reflected a strong economy, bolstered by high migration numbers.

But Cobalt Recruitment representative Guy Davidson said the labour squeeze was starting to hurt businesses, as they found it increasingly hard to woo workers.

"I've heard this construction boom being referred to as the profitless boom because margins are so tight - it's the supply of funding for projects, it's the supply of materials and it's the supply of human resource that's creating so much strain."

Increasingly, employers had to go offshore to find talent - and it was not just money they were offering, Mr Davidson said.

"The most creative thing is employers moving to a four-day work week," he said.

"That here is something that's been spoken about for many, many years, but actually seeing employers break with the status quo and move to a four-day work week, I think's incredibly creative."

Employers were also trying hard to make their work culture more enticing, he said.

"There's a lot of little things that employers will do - extending your leave entitlements ... going away for weekends, social events, it might be the environment in which they're working."

RDT Pacific director Simon Wilson was looking for six people with at least five years' project management experience to join his construction consultancy.

He recently approached a New Zealander with 10 years' project management experience just days after he had returned from New York, but the person had already been snapped up.

"He arrived back on the Sunday. He'd had two interviews and offers on the Monday and Tuesday and they were so compelling [that] by the time I got to meet him on Thursday he said, 'Simon, if you'd arrived at the airport with a sign saying, sign up and here's the terms, perhaps you could have got me.'"

In the months it took to find the right people, mostly from overseas, his company was missing out on opportunities to grow, Mr Wilson said.

"It's definitely the most severe shortage that I have [seen]."

About 75 businesses were at yesterday's JobFest in Auckland offering a record 1250 jobs, in an attempt to tackle critical skills shortage in construction, tourism, hospitality and technology.

Ian Rivett, a worker for glass-maker and installer Viridian, said he had been looking for someone to take an entry-level warehouse role for six months now.

"They only thing I need them to be able to do is drive a class 2 vehicle, and I can't find that in the Auckland market at the moment."

Work agency AWF representative Stuart Floan said the labour shortage was stunting growth.

"I had a customer who hasn't used an agency in 10 years contact us last week and said, we have 15 positions we can't fill - and they weren't skilled positions."

Westpac senior economist Satish Ranchhod said the pressure on pay was confined to tourism and construction for now, as high migration levels was still depressing wages in other sectors.

But he expected that to change this year.

"Right now things are all pointing to stronger wage growth over the coming year."