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NZ net migration continues slow in July as long-term visitors pack up and leave

Tuesday 21st August 2018

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New Zealand's inbound net migration continued to slow from a peak last year as a growing number of long-term visitors leave the country, on top of more Kiwis departing for Australia. 

Net migration was 63,800 in the year ended July 31, down from 72,400 a year earlier, Statistics New Zealand said. A net outflow of 5,300 people in the month of July continued the declining trend, and reduces the economic impulse of an expanding population. 

A net outflow of Australians, Chinese, and Brits contributed almost half the turnaround of the past 12 months, especially Chinese people on permanent and student visas. Filipinos on permanent residence visas also registered a sharp reversal. 

"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 in a statement. "Smaller countries like New Zealand and Ireland tend to have larger swings in net migration rates simply because they have a small population." 

New Zealand's inbound migration figures have been flattered in recent years by a lacklustre Australian economy. Kiwis have typically sought a better life across the Tasman, but have tended to stay home over the past five years as New Zealand's economy has hummed and jobs have been relatively plentiful. 

The headline net migration figure was often cited by politicians on last year's campaign trail as putting stress on domestic infrastructure in need of upgrading. International students, in particular, were singled out, despite accounting for about 20 percent of arrivals with many only staying for the length of their study. 

Westpac Banking Corp senior economist Satish Ranchhod said the increase in departures and shrinking net migration mirrored "the increase in arrivals of those on temporary work and student visas that we saw in previous years" with many of those people departing after three-to-four years. 

"We expect that migration will continue to ease back over the next few years, pulling population growth down in the process," Ranchhod said. "This reinforces our expectations for a period of soft demand growth over the coming years."

New Zealand's strong tourism has also been blamed for the added strain on infrastructure. Today's figures show short-term arrivals rose 1.4 percent to 251,000 in July from a year earlier, for an annual increase of 3.6 percent to 3.79 million, equivalent to about 78 percent of New Zealand's population. 

ASB Bank senior economist Mark Smith said the trend in visitor arrivals suggested the numbers have plateaued at historically high levels, with capacity stretched at peak periods given the tourism boom.

"The lower NZD/USD will help boost incomes but stronger growth in tourism capacity and better utilisation of the NZ tourist offering in the shoulder and low seasons will be needed to underpin incomes in the sector going forward," Smith said. 


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