Once seen as a beautiful and forward-thinking country, New Zealand’s weak economy has forced many of its citizens to leave. High costs, steep interest rates, and rising unemployment have led to a record number of people moving abroad. In the past year, up to June 2024, 131,200 people left New Zealand, with 80,200 of them being citizens. This is nearly 70% more than the number of people who left before the pandemic in 2019.
According to Nick Tuffley, chief economist at ASB Bank, the combination of economic problems and the desire to experience life abroad has led to a large number of millennials and Gen Z Kiwis leaving. Government data shows that over half of the people who left between 2023 and 2024 were aged between 20 and 39, with the largest group being between 25 and 29.
At the start of the Covid-19 pandemic, New Zealand implemented strict lockdowns and made it mandatory for people entering the country to stay in isolation for 14 days. This helped eliminate the virus, and New Zealand was praised for its quick response.
However, those subsidies have since ended, and many small businesses that closed during the pandemic have not reopened. Inflation has also reduced the buying power of New Zealanders. In June 2022, inflation reached 7.3%, the highest in over 30 years. While inflation has since dropped to 3.3% in mid-2024, it remains above the Reserve Bank’s target of 1% to 3%.
Housing costs, including rent and mortgages, are still very high, with CoreLogic data showing that housing affordability is worse than long-term averages. In the past three years, mortgage payments have taken up over 50% of household income, compared to just six quarters during the global financial crisis in 2007-2008.
Australia is the top destination for New Zealand emigrants, partly because its economy is stronger. New Zealand citizens can move to Australia easily under a special visa. Since July 2023, New Zealanders who have lived in Australia for at least four years can directly apply for citizenship.
The Australian government has also actively sought Kiwi workers for its public sector, even placing full-page ads in New Zealand newspapers offering “warmer days and higher pays” to Kiwi police officers. A salary guide by recruitment company Hays found that jobs in Australia often pay significantly more than in New Zealand. For example, a construction foreman in Sydney can earn over 60% more than one in Auckland.
While New Zealand has relied on immigration to fill labor shortages, rising unemployment suggests the country may now be facing a mismatch between available skills and jobs.
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