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Lure Of Australia Remains Strong As Kiwis Leave In Record Numbers
Susan Edmunds, Money Correspondent
A record number of New Zealand citizens left the country in the year to September, and about half of them went to Australia, Stats NZ says.
It has released new data showing the country had a net migration gain of 44,900, sharply down from a provisional peak of 136,300 recorded in the year to October 2023.
Stats NZ said the number of people moving to New Zealand was down and departures had increased.
There was a net loss of 54,700 New Zealand citizens in the year, driven by 79,700 departures and 24,900 arrivals.
ASB economists said it was likely that departure numbers would remain historically high as people looked for better opportunities elsewhere.
Chief economist Nick Tuffley said there was a chance that the number of people leaving the country could exceed those coming in next year.
"Until we start seeing that outflow start to slow, there is that risk that net migration figures get quite weak.
"Arrivals have been slowing steadily for some time and we are yet to see a clear peak in the outflow of New Zealanders. It is turning those figures around very rapidly."
An improvement in the economy next year could help retain people, but there was a challenge posed by the labour market being tough, he said, while Australia's was comparably healthier.
Australia was likely to remain a pull for New Zealanders for a while.
"We do need economic conditions in New Zealand to be a bit more favourable to help hold on to people. That outflow of New Zealanders has been very strong and we're still not seeing material signs of it turning around.
"For the next while we would expect to see net migration figures continuing to weaken. New Zealand is not as attractive to new arrivals and you still have that challenge of a high outflow of people. That's likely to remain fairly elevated until we see the economy turn around and give a stronger reason for people to stay."
But Westpac economists said the outright number of departures of New Zealanders had slowed in recent months, although they were still well above pre-Covid levels.
'The slowdown in departures is notable given that job prospects in Australia remain significantly more positive than in New Zealand," said senior economist Michael Gordon.
"However, some of the surge in departures will have reflected catch-up activity after the border was reopened - and perhaps to a greater degree than we had assumed."
ANZ economist Henry Russell agreed monthly departures seemed to have passed the peak but remained elevated.
"What's behind the sharp fall in net migration inflows is the relative weakness of New Zealand's labour market. Declining job prospects have curtailed arrivals and seen New Zealanders leave in droves in search of better opportunities abroad.
"Australia remains the largest destination for outgoing Kiwis, where labour market conditions are stronger. Employment growth in Australia remains fairly robust, up 3.1 percent year-on-year as of September. In comparison, employment in New Zealand is contracting, down 0.4 percent year-on-year as of the September quarter.
"We expect annual net migration inflows to continue to decline into next year, consistent with the broader economic cycle. With the Reserve Bank now in cutting mode, and emerging evidence that the economy is already responding to lower interest rates, things are looking brighter, but given the labour market lags the broader economy, the New Zealand labour market is expected to continue to weaken through to the middle of next year."
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