Thousands head overseas, partly because of economic conditions, with departures accelerating and labour shortage feared
Young New Zealanders are leaving in droves as borders reopen and economic conditions tighten at home.
The latest data from Stats NZ found that in the year to March, annual net migration was negative, with 7,300 more people leaving than entering. That loss marks a dramatic shift from early in the pandemic when border closures and the relative safety of Covid-free New Zealand prevented many from leaving. In the year to March 2020 there was a record net gain of 91,700.
Now, many New Zealanders – particularly young professionals and graduates – are heading off overseas once more. Some are driven by tough economic conditions in New Zealand, which is dealing with high inflation of 6.9%, housing unaffordability, and sky-high living costs: petrol, rents, mortgage interest rates and groceries are all on the rise.
Brad Olsen, Infometrics principal economist and director, said the latest figures “demonstrate just how momentous really the shift has been in New Zealand’s migration outcomes”, changing to a net loss from 50,000-60,000 annual net gains in the years leading up to the pandemic. “It’s a huge reversal – and the first time we’ve seen those negative figures since the global financial crisis, the Christchurch earthquakes and the Australian mining boom all combined in the early 2010s.”
Stats NZ, the government’s data and statistics agency, said the losses were driven by young adults, with a particular increase in New Zealand citizens aged 18 to 27 leaving. With unemployment already at a low of 3.2%, economists say the loss of more of the workforce via migration could create ongoing labour shortages.
“The difficulty finding workers is extreme around the country – you have a smaller working age population than the year before, at a time when everyone is desperately calling out for workers. [It] really just exacerbates the pressures that businesses are under,” Olsen said.
In April, government documents estimated that 50,000 people would leave over the next year – but that the number could swell to 125,000 if the many young people who had delayed post-graduation trips during the pandemic left too.
Asked about those projected losses, the prime minister, Jacinda Ardern, said that overseas trips were “part of our history” and a rite of passage for many New Zealanders, noting that she had spent time living in London. “It has been part of our history as a nation to frequently have New Zealanders come and go as part of our overseas experience, building skills and talent.”
Olsen said there were a mixture of contributing factors including pent-up demand from those who delayed leaving over the past two years, high living costs, housing unaffordability, and delays fully reopening New Zealand’s borders, which meant lower numbers of migrants coming in.