Our Changing, and Challenging, Immigration Landscape

New Zealand’s immigration settings are evolving rapidly, and the implications are both promising and problematic. While recent reforms aim to address labour shortages and economic growth, the broader trend of declining immigration is beginning to bite.

Historically, New Zealand’s economic and population growth has been driven by high immigration. But the latest Stats NZ data shows a sharp reversal: net migration fell to just 13,700 in the year to June 2025, down from 70,400 the year before, and from a peak of 136,700 in the year to October 2023. This slowdown is well below historical averages and is already impacting sectors reliant on migrant labour. With fertility rates below replacement levels and an ageing population, migration is the primary driver of workforce and population growth—and its decline can only constrain productivity and regional development.

Recent changes to the Accredited Employer Work Visa (AEWV) scheme, including the removal of the median wage threshold in favour of market rates, have eased hiring processes. In August, ten new trade roles, including welders, fitters, and vehicle painters, were added to the Work to Residence pathway. While these additions provide a more certain path to residency, the payrate thresholds, of up to $43.63/hour for some roles, are often unattainable for regional employers and may force migrant workers in these roles to leave for higher-paying jobs in larger cities.

The new Parent Boost Visitor Visa, from late September, will allow parents of New Zealand citizens and residents to stay for up to five years, with the option to extend for another five. While not a pathway to residence, it offers long-term family reunification and supports migrant retention by strengthening family ties. The Government was forecasting between 2,000 and 10,000 applications per year, however this is a relatively complex policy and the financial support and mandatory health insurance requirements may limit applicant numbers to the low end.

To help achieve its goal of doubling the value of international education, The Government is increasing the work hours students can work and is also considering new short-term post-study work visas for pre-degree qualifications (NZQF Levels 4–7). This move may boost enrolments in vocational programmes and support industries facing skill shortages, particularly in regional areas, but this cohort is likely to present challenges if they cannot quickly transition to long term work visas. A trial beginning early November to enable Chinese nationals, holding certain Australian visas, to travel from Australia to NZ will also, and immediately, boost visitor numbers.

The revamped Active Investor Plus (AIP) visa, launched in April 2025, is a shining light with already close to 300 applications under the new settings, representing over NZD $1.6 billion in potential investment. The AIP, which requires applicants to invest either $5m for 3 years in active investments or $10m for 5 years in more passive investments, is on track to achieve $2.5m of committed new investment into NZ by the end of this year. While the numbers are low compared to other visa categories the potential impact of the AIP provides a very welcome and meaningful catalyst for the NZ economy.

While policy changes offer new opportunities, the broader trend of low migration is here to stay. In fact, net migration may worsen before it improves with some 200,000 new residents becoming eligible for New Zealand citizenship in the next two years, and who will then be in a position to “cross the ditch” in search of better opportunities.

Low immigration, stagnant house prices, sticky inflation and low productivity are all combining to keep the handbrake on the New Zealand economy. However, there is one promising avenue to increase productivity: Artificial Intelligence. AI can help offset labour shortages, drive innovation, and boost economic performance. AI is not a silver bullet, but it may be the best lever we have to unlock productivity and prosperity in a low-immigration era.