Pete Wargent blogspot

CEO AllenWargent Property Buyers, & WargentAdvisory (institutional). 6 x finance author.

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Monday, 22 August 2016

Kiwi exodus reverses

Migration to NZ slows

Following a period of strong migration from Australia to New Zealand, largely comprised of Kiwis returning home, this trend has now demonstrably slowed up in recent months, with departures for NZ now in a declining trend. 

About 15,800 New Zealand citizens per annum have migrated from Australia to NZ over the past three years, well above the 35 year average to 2013 of 8,900. 

Despite this shift there are still more NZ citizens departing for Australia permanently than arriving from Australia, since Australia has a larger and more diverse economy, more opportunities, employment, and comparatively high average weekly earnings

The annual number of permanent and long term migrants from Australia to NZ is now slowly but surely pulling back. 

In fact, Statistics NZ actually reported a seasonally adjusted net losses of permanent departures from New Zealand to Australia in July:

"There was a small seasonally adjusted net loss of 20 migrants to Australia in July 2016. 

This relates to the declining trend in migrant arrivals from Australia and an increasing trend in migrant departures to Australia."

Going forward

If you think that Australia's labour force figures are a bit up and down, then this volatility is nothing compared with what is seen in New Zealand! 

The unemployment rate figures for NZ are absolutely all over the place, the latest wild revisions taking the unemployment rate for the March 2016 quarter all the way down to 5.2 per cent, leading to an apparently "steady" quarter-on-quarter result in June.

Technically, therefore, New Zealand (5.1 per cent) now has a lower unemployment rate than Australia (5.7 per cent).

Generally speaking, a comparatively lower unemployment rate should work in NZ's favour when potential migrants are weighing up travel decisions. 

In reality both economies have been impacted by their respective weaknesses in export prices, with New Zealand's dairy industry racking up some alarming losses. 

Both countries are also seeing strong employment growth and inflows of capital to their largest cities, but typically weaker activity in their regions. 

And both countries are pushing immigration from Asian international students as a key demographic policy. 

Brexit impacts

I've previously noted how British permanent migrants to Australia fell to their lowest monthly level on record in June at just 410 down from a record 2,560 in August 2007.

It's been one of the contributory factors in Australia's slowing population growth, with Asian migrants capturing an ever-increasing share.

Britain's recent "Brexit" referendum - resulting in a momentous decision to leave the European Union - is expected to have some impact here, with more Britons expected to seek an alternative status. 

This shock result could potentially benefit immigration in both New Zealand and Australia.

Indeed, it has already been noted that there has been a tenfold increase in British registrants to migrate to New Zealand immediately after the Brexit vote.

10,649 Brits registered to move to New Zealand in the 49 days following the vote, according to the NZ Herald, up from only 4,599 registrations in the corresponding prior year period.