Key Takeaways:
- New Zealand’s economic downturn, marked by rising unemployment and job losses, prompts 2,000 Kiwis monthly to move to Australia.
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Record migrations hit New Zealand, with a net loss of 52,500 citizens in a year; job competition intensifies.
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Higher wages and better job prospects in Australia draw Kiwis, coupled with a new four-year pathway to citizenship.
Economic Struggles in New Zealand: Why Are Kiwis Moving to Australia?
What is the Current State of Employment in New Zealand?
New Zealand’s economic downturn has led to increasing unemployment, which is projected to reach 5% by the end of the year. This situation has prompted many Kiwis to look abroad for better opportunities. Indeed, Australia is now witnessing an influx of approximately 2,000 New Zealanders each month.
Economists predict that the economic conditions in New Zealand are likely to worsen before they get better. Job losses are becoming more frequent as the government slashes budgets, major media companies shut down or reduce programming, and employers in various sectors, such as food manufacturing and fashion, close their doors.
New Zealand’s technical recession, witnessed twice over the past 18 months, is part of the post-COVID recovery struggles. High inflation led the central bank to raise the official cash rate, contributing to increased living costs and interest rates. This economic scenario is now evident in the rising unemployment rate.
How Are Job Losses Contributing to NZ Unemployment?
The expected full budget from the new right-bloc Coalition government is anticipated to reveal further public service cuts, potentially impacting around 4,000 jobs in over 30 agencies. Moreover, numerous significant job losses are on the horizon as Warner Bros Discovery plans to shut down Newshub, causing 200 staff to lose their jobs. Similarly, TVNZ will shed nearly 70 jobs, and companies like fashion brand Kate Sylvester and a food manufacturer have announced closures.
Infometrics’ Principal Economist Brad Olsen remarks, “We are going to see those [public sector job losses] show up in the unemployment numbers later on in the year.”
The job market has been shrinking for a while, with Seek New Zealand data indicating a steady decline in job advertisements since 2022. This tightening job market and an increase in net migration mean more workers are vying for fewer positions. New Zealand-based ANZ economist adds, “There’s just been more people in the country chasing fewer jobs.”
Why Are Record Numbers of Kiwis Leaving New Zealand?
Many factors are driving Kiwis to leave New Zealand. Since early 2022, the number of migrant arrivals has surged, intensifying competition for jobs. The population growth rate has been the fastest since World War II, leading to an increased number of job seekers and significantly fewer job ads—down 30% and 17% below pre-pandemic levels, respectively.
The recent migration data echoes these sentiments. More than 78,000 Kiwis left New Zealand in the year leading to March 2024, mainly heading to Australia. Meanwhile, fewer than 26,000 New Zealanders returned, resulting in a net loss of 52,500 citizens—the highest recorded to date. Stats NZ Population Indicators Manager Tehseen Islam highlights, “This is the first time the annual net migration loss of New Zealand citizens has exceeded 50,000.”
Mr. Islam further emphasizes, “That equates to 1,000 more New Zealand citizens departing long-term than arriving long-term each week,” with over half these migrations directed towards Australia. The reasons for this exodus include the challenging job market and stagnant wage growth in New Zealand.
Economist Mr. Russell explains, “Businesses are expecting to offer lower wage settlements or lower wage increases than what inflation expectations are, so based on that, consumers or households or employees are going backwards in New Zealand.”
Why Are Kiwis Moving to Australia for Jobs?
Australia presents an alluring proposition for many Kiwis. Both countries face cost-of-living crises, yet wages are significantly higher in Australia. The most recent data for 2022-23 shows the highest migration of New Zealanders to Australia in a decade—41,000 in that period, with an average of 33,000 annually in the five years before the pandemic.
Brad Olsen points out that between July and September 2023, the net loss of people from New Zealand to Australia was 6,000, highlighting how Australia gained 2,000 more New Zealanders each month. “Those are some of the worst numbers that we’ve seen in terms of people moving from New Zealand to Australia since around 2013,” he notes.
What Lies Ahead for the New Zealand Economy?
Economists agree that New Zealanders must brace for tough economic conditions for an extended period. The Reserve Bank of New Zealand increased the cash rate starting in October 2021, and it currently sits at 5.5%, with no cuts expected this year. The ongoing efforts to reduce inflation are taking longer than projected.
Mr. Russell notes, “It has become clear in the past couple of months that the economy has deteriorated pretty significantly.” The labor market has been resilient so far, helping households weather aggressive tightening cycles. However, the landscape is shifting. Olson warns, “It’s getting to the tougher end of the inflation fight. It is crunch time.”
Is There a Future Incentive for Kiwis Moving to Australia?
Moving to Australia offers not just the prospect of higher wages but also a new four-year pathway to citizenship. This double incentive has driven many New Zealanders to make the leap across the Tasman. By choosing Australia, Kiwis can benefit from better job opportunities, higher wages, and an eventual path to citizenship. For any updates on the Australian immigration processes or to understand the requirements, official resources like the Australian Department of Home Affairs provide comprehensive guidance.
This massive movement from New Zealand to Australia marks a significant shift in the labor landscape of both countries. While New Zealand faces challenging economic times, Australia offers a beacon of hope with its higher wages and opportunities for a new beginning.
Learn Today:
Glossary of Immigration Terms
- Technical Recession:
A period of economic decline marked by two consecutive quarters of falling GDP. New Zealand has experienced two such periods over the past 18 months. -
Net Migration:
The difference between the number of people entering a country and those leaving it. New Zealand has witnessed a significant net migration loss, with more citizens moving out than returning. -
Inflation:
The rate at which the general level of prices for goods and services is rising, eroding purchasing power. High inflation in New Zealand has led to increased living costs and higher interest rates. -
Unemployment Rate:
The percentage of the labor force that is jobless and actively seeking employment. New Zealand’s unemployment rate is projected to reach 5% due to economic downturns and job losses. -
Pathway to Citizenship:
Legal processes or criteria through which an immigrant can become a citizen of another country. Australia offers a new four-year pathway to citizenship for New Zealanders, making it an attractive destination for those seeking better opportunities.
This Article In A Nutshell:
New Zealand’s economic struggles and rising unemployment have driven many Kiwis to move to Australia. Higher wages and better job prospects attract approximately 2,000 New Zealanders monthly. As New Zealand faces a challenging economic recovery, Australia offers hope and new opportunities for those seeking a better life.
— By VisaVerge.com
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