Both big and small companies are scrambling to hang on to their workforces, with thousands of temporary resident visas set to expire - all at once.
Anyone in the country with a work, student, visitor, limited or interim visa, with an expiration date of between 2 April and 9 July, was given until 25 September to renew their visa.
Temporary residents who were overseas when their visas expired had not been granted the automatic extension, and would also need to reapply.
There were about 350,000 temporary visa holders in the country during the lockdown, and the government estimated more than 200,000 of them had work visas with conditions that might need to be varied.
However Immigration New Zealand was not renewing or issuing any new visas until it was satisfied there was no citizen or permanent resident available to do the applicant's job.
Association for Migration and Investment chair June Ranson said employers were desperate for an answer on the looming deadline, and were concerned the government was delaying visa decisions for political reasons.
"I think we've got a disaster on our hands on September 25th, simply because we don't know what the plan is. I mean you've got thousands of visa applications, all coming to expire at the same time.
"We're saying, what is the plan ahead? We've got silence, we haven't got a plan," Ranson said.
Employers who wanted to keep temporary visa holders on as staff must readvertise their jobs, interview applicants and then offer any qualified candidates the position.
They would also need to satisfy Immigration they had done a thorough job and made a genuine effort.
Some of those roles would also require a skills match test, which was another time-consuming and potentially costly process.
The government had fast-tracked the Immigration (Covid-19 response) Amendment Act, to allow a 12-month timeframe to impose, vary or cancel conditions for groups of temporary visa holders, including the ability to extend expiry dates and waive any regulatory requirements for certain classes of application.
However, Immigration Minister Iain Lees-Galloway said he was taking a cautious approach to using those temporary powers, which would expire next May.
"These are very broad and significant paths for one minister to hold, and that they need to be used justly and carefully, so as soon as the legislation was passed I immediately sought advice on the types of things that it might be appropriate to use those additional powers for.
"I've received that advice, we're working through our possible options and I anticipate making announcements about those in the very near future."
The minister would not say when an announcement would be made, but cautioned that migrants need to be realistic about what opportunities will be available.
"In recent years we've had a labour market that has been highly dependent on the migrant workforce, and people could anticipate that visas would simply be rolled over because the work was there," but he said that had changed with growing unemployment in New Zealand.
Unemployment was just 4.2 percent in the three months ended March, but Treasury estimated the unemployment rate has since climbed to 7.3 percent in the three months ended in June, and would peak at 9 percent, later this year.
"We always put New Zealanders at the front of the queue for jobs, and so people will need to look carefully at what is going on, what the prospects look like, and obviously make decisions for themselves about what's right for them," the minister said.
Ranson said the delay in making a decision was becoming critical for some businesses.
"Well some businesses are going to have shut down, because they can't get labour.
"They (the government) seems to think that they can retrain everybody. Look it doesn't quite happen like that."
Ranson said the dairy industry had been hard hit by the difficulties arising from keeping trained migrant workers.
"The dairy workers are saying look this is going into our busiest time. We need to have the people here, able to do the work, and the only ones that are around to do it are migrants, and we would like to extend their visas. Some of them have been in New Zealand over seven years."
The hospitality sector, which was the last to fully emerge from the Covid-19 lockdown, and also employed a large proportion of temporary residents in low-skilled jobs, was facing the prospect of replacing a large number of staff in the next three months.
Hospitality New Zealand chief executive Julie White said a recent survey of members found one in five were currently advertising positions.
She said they were attracting many applicants, but few had the training and experience necessary to fill the positions, which were currently occupied by even low-skilled migrants.
"Our members are telling us that it's really radio silence for Immigration New Zealand," White said.
"And for those people who have actually got through to Immigration New Zealand ... it's a carte blanche 'no'," she said, adding that long-term migrant workers were treated the same as those who had been in employment for just a few months.
White said she doubted whether Lees-Galloway could address the needs of the sector, considering the industry had not been consulted.
"He hasn't been connected with Hospitality New Zealand, so if he is going to extend some relief, well, is that the right relief?" she said, adding the organisation had not had any contact with the minister, but had just submitted a paper setting out its concerns.
White said the industry was keen to hire and train more New Zealanders and permanent residents, but it was not something that could be done overnight.
"Some of our suggestions are to restore hospitality tourism to local education subjects. We think this needs to start early.
"We see hospitality tourism is not currently given the weight and attention it deserves, keeping in mind we actually contribute $40 billion to the economy," White said.
She said the recent establishment of regional skills leadership groups to develop labour market plans, including education, immigration and social development priorities, was a good approach to addressing the longer-term issues.
However, she said it would make little difference to the current situation facing employers, as the groups were not expected to report their initial findings until October, which was after the September deadline.
