Kiwis head back to Australia as net migration slows

NZ's annual net migration gain is falling and departures to Australia are on the rise.

Kiwis are starting to head across the ditch to live and work again and that has contributed to the fall in New Zealand's annual net migration gain.

Annual net migration for the year to July 2018 was 63,800, according to new numbers released by Stats NZ yesterday.

That is now down 8,600 from its peak of 74,200 in July 2017 – but still high by historic levels.

While the numbers remain low by historic standards, economists have noted that an uptick in departures to Australia may represent a return to a more traditional migration pattern.

For decades, a steady flow of New Zealanders headed to Australia for better employment and lifestyle options.

This trend last peaked in 2012 when the Australian economy was booming.

Since then the numbers have declined, flatlining (below 2000 long-term departures) since 2014.

In the past two years we've even seen more Australians moving to New Zealand in some of the monthly data.

However since the start of 2018 the traditional trend has started to re-emerge.

"Departures are trending up, reflecting the natural cycling out of previous arrivals, but also, of late, an evolving relative performance of the Australasian labour markets," ANZ chief economist Sharon Zollner said.

"Australian unemployment is at a six-year low (albeit still higher than in New Zealand). Arrivals continue to moderate, but remain high, with the impact of policy tweaks still playing out."

The July data showed that arrivals remained static at 10,600 for the month, the fall to a lower net figure was driven by a lift in permanent and long-term departures.

"How rapidly the migration cycle will ease is a key source of uncertainty for the economic outlook going forward," Zollner said.

"With population growth having provided two thirds of New Zealand's economic growth in the last year, migration is key to watch."

Migration became a political flashpoint in last year's election with critics of the National Government arguing that it was being used to prop up economic growth and was putting too much pressure on the housing market and infrastructure.

Stats NZ yesterday noted that the decrease in the net figure was mainly driven by more non-New Zealand citizen migrants leaving the country, after being in New Zealand for at least a year.

Non-New Zealand citizen migrant departures were up 20 per cent from the July 2017 year to 31,300.

"Even though annual net migration is lower than a year ago, it is still high by historical standards," Stats NZ population insights senior manager Brooke Theyers said.

"Smaller countries like New Zealand and Ireland tend to have larger swings in net migration rates simply because they have a small population. In contrast, countries with large populations tend to have low net migration rates."

New Zealand's current migration rate is almost four times as high as the United Kingdom and the United States. Both had a net migration rate of 3.4 people per 1,000 population in the June 2017 year, he said.

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