New Zealand Immigration – at the cross roads4 Oct 2024

New Zealand has historically experienced cycles of very high migration, followed by big falls, with migrant numbers driven by policies set according to the then current pressures and demands. However, and as we all know, planning for health, education, infrastructure and housing is based on the level and composition of our future population, and it is very difficult to plan ahead when we have such boom-and-bust immigration cycles.

New Zealand’s current net migration boom peaked last year with a record net 136,000 new migrants in the year to October 2023. The latest statistics for the year to July 2024 confirm we are currently on a strong downward trend with net annual migration falling to 67,000. Commentators are now expecting monthly net migration to turn negative during 2025 and this will almost certainly be the case. This is due to lower migrant arrivals and more departures as the job market tightens and it is more challenging for new and existing migrants to secure or maintain work. This is particularly the case for lower skilled workers, who previously made up the majority of work visa migrants, and for whom immigration policies have since been significantly tightened. Many migrant workers already in New Zealand will also now be planning to leave as they no longer have a clear pathway to residence - and there is a 3- or 5-year limitation on the duration of their work visas. And, we also have New Zealanders continuing to leave the country – and this applies not only to New Zealand born citizens but also to new citizens who can obtain their New Zealand passport after holding New Zealand residence and living here for 5 years (81,000 New Zealanders departed in the year to July!).

We have very significant Immigration NZ fee increases from 1 October with the main skilled migrant residence application fee increasing from $4,290 to $6,450. These increases also have the potential to dampen migrant demand.

Less migrants arriving, and more departures, will impact on the demand for health, education, housing and general infrastructure. Today we need more teachers… but tomorrow?

New Zealand needs migrants.

The country’s current fertility rate of 1.56 births per woman is well below, and has been for over 10 years, the 2.1 birth rate required to naturally replace our population. This population is also aging with the number of people aged 65 years and older expected to hit 1 million by 2028 and, consequently, we have 1,000 people retiring from the workforce each week.

New Zealand not only needs to maintain positive net migration, but it needs migration policies which fundamentally address New Zealand’s long-term needs – i.e., our aging population and long-term skill needs. Relocating to a new country is a major decision, and requires long term planning which, in turn, requires policy settings which have longevity and reliability, and which are set on the basis of New Zealand’s long-term interests – a New Zealand “Green Card?”. These policies should be differentiated from short term policy settings, set in reaction to short term needs, which will still be required but should not form the main focus of our long-term migration planning.

We are nearing the immigration crossroads, and some decisions must be made on what long term direction to take. A New Zealand “Green Card” could be an interesting option…and also, potentially, a way to retain some of those migrants who have already made New Zealand home?

Link: First Published in the Waikato Business News, October 2024 Edition, Page 10