1 in 4 people born in New Zealand live elsewhere by age 30

Some fascinating research by Tim Hughes and his team at Treasury reveals that "25-30% of people born in New Zealand are living elsewhere by age 30."

We find that only about a third of emigration each year is of the NZ-born, and about 40% of NZ-born emigrants return to live in NZ again. Those with the highest qualifications are most likely to leave but also the most likely to return. Those who return earn more and pay more tax than those never to leave.
    Yet much emigration is permanent and the diaspora is still substantial, with 25-30% of each birth cohort living elsewhere by age 30. Approximately $4b of public investment in human capital [sic] each year is ultimately lost to emigration, needing to be replaced with migration from other countries.

Complementary research further reveals that this "human capital [sic] is replaced via migration of people born elsewhere. 

Foreign-born residents contribute a disproportionate share of personal tax revenue, reflecting their age structure and other factors.
    In 2024, foreign-born NZ residents made up 32% of the population, and paid 38% of the personal tax.
    This analysis helps demonstrate the growing importance of migration policy settings for fiscal sustainability.

[hat tip Eric Crampton]

"Kiwi Exodus"

The Economist has discovered all is not well down here in this sleepy authoritarian backwater.

From afar [says 'The Economist''s promo], New Zealand always seemed like an ideal destination. Beautiful nature, friendly people, relatively sane politics. And if you’re a fan of Tolkien, you can visit the film home of Bilbo Baggins.

But New Zealanders are leaving their country in record numbers. Almost 129,000 residents emigrated last year—40% above the pre-pandemic average for this century. Holy Shire, what’s going on?! Our report looks at why Kiwis are moving out, where they are going and how their government may struggle to reverse the trend.

It's not so much a "report," however. More just a few pessimistic paragraphs under the heading 'Kiwi Exodus' riffing on the failure of a lacklustre National Government to stop the rot...

New Zealanders ... are leaving their country in record numbers. Almost 129,000 residents emigrated last year—40% above the pre-pandemic average for this century. It is not a case of last in, first out. The majority of those leaving were New Zealanders, rather than immigrants returning home, creating a net loss of 47,000 citizens. ...

Its small economy and relative lack of opportunity have long driven young New Zealanders towards what they call the 'overseas experience,' fanning fears of brain drain. Proportionate to its population of 5.3m, it has one of the largest diasporas in the OECD ...

Recently, New Zealand has been in a rut. The economy is in recession and unemployment has risen. Outgoing Kiwis grumble about costly housing and a crime surge.
 
Unlike most, they have an alternative when times get tough: they are free to live and work in Australia, and vice versa. Almost 15% of them are now based across the ditch”. It is not just that Australia’s economy has weathered the cost-of-living crisis better. The income gap between the pair has been growing for decades. Adjusted for purchasing power, Australia’s per person GDP is about a third higher than New Zealand’s. Its pensions are more generous, and its centre-left Labor government has made it easier for Kiwis to get passports and benefits. By comparison, New Zealand is 'a sinking boat,' says one transplant on a Facebook group for Kiwi expats. Australia is 'best for [an] easy life,' writes another.

In the past, fears of brain drain have proved overblown. Young expats have generally returned, and governments have offset losses by letting in immigrants from countries such as India and China. The result was a 'brain exchange,' says Paul Spoonley, a sociologist at New Zealand’s Massey University. But there is a risk of that changing, he argues. First, he says, it is no longer just young New Zealanders who are leaving, but more experienced professionals and extended families. Second, inward immigration is now slowing. After a post-pandemic spike, it plunged by around a third last year, though the population is still growing. Christopher Luxon, the prime minister, says the solution is 'to build a long-term proposition where New Zealanders actually choose to stay.' But that has not proved easy. In 2009 John Key, then prime minister, set out to 'match Australia by 2025.' In Wellington, the capital, some now joke that a more realistic goal would be to 'beat Fiji by 2050.'

"In short New Zealand had better prepare for a significant socio-economic brain drain."

"So, what have I found this year? 

    "The first is that only a very tiny proportion [of uni students], from first year to third year, see any sort of future for themselves in New Zealand over the next five to ten years. It is not just, as some readers may wish to state, that these students wish to leave Christchurch. The fact is, they overwhelmingly want to leave New Zealand, citing housing, the cost of living and higher wages and more opportunities overseas as the central drivers. 

    "I have never encountered such a widespread and deep sense of despair and despondency across tertiary-educated young people as I have in the first six months of this year. The Covid years came close but there was still a residual hope that things could – or would – get better. This has collapsed. 

    "In short New Zealand had better prepare for a significant socio-economic brain drain."

~ sociology lecturer Mike Grimshaw, from his post 'No hope and no choice? Snap polls on New Zealand…'

Emigration again?

“My view [says economist Tony Alexander*] is when the borders open a generation of young Kiwis will depart our shores for Australia for the higher wages on offer and lower cost of living, and to embrace some freedom after two years being locked up.”

Discuss.

* Hat tip Bob Jones.

Red and Blue Teams are both driving people away

Record number of Kiwis head to Aust ... the highest in nineteen years.

Statistics New Zealand said there was a net outflow of 33,300 people to Australia in the year to August. That's the highest figure since the February 1989 year. Some 2900 people packed their bags in August itself, up from 1900 a year ago.

And the Blue Team are still using the departure of some of NZ's best people to damn the present government ... oblivious even now that emigration is a long-term decision, and since National has looked for months like the likely winner come the election, the record number of departures is as  much an indictment of them and of the low expectations of a Key-led administration as it is of the present Clark regime.

Good people are leaving in their droves, and they see nothing from either side of the aisle to keep them here.

That's a real tragedy.

Let the bullshit begin

The National Party's billboard campaign, now started, is singularly weak.  Not because the issue is not an important one -- NZ's loss of some of its most talented people to the convicts on the western island is a slowly unwinding disaster for this country -- and not just because the the billboard's style lacks clarity or force. See:

              

It's singularly weak because National itself must shoulder a fair share of the blame for the continuing exodus of some of our best and brightest, and not just because they were responsible in the past for the likes of the Resource Management Act and the signing of the Kyoto Protocol, but for what people think they'll do in the future -- which in just two words, is very little.

You see, if the Labour Government's campaign against prosperity is what is pushing New Zealanders in their droves to leave in search of something better -- a poll back in May suggested as many as 1 in 10 adult New Zealanders is "fed up with high interest rates, worried about the housing market, and want better wages," and is thinking about leaving the country to get them -- then the National Party's promises and their campaign against their own party's principles is doing nothing to make anyone consider changing their plans -- and I'd suggest National's cheerleaders and their strategists (if such a species exists) reflect on that point. 

If the Labour-led Government is driving them away, then the prospect of a National-led government is doing nothing to arrest the flood.  Ask yourself why?

Emigration isn't a spur-of-the-moment decision -- it's a life-changing decision most people make based on long-term expectations.  For most of the last year those expectations would include the quite reasonable assumption that National will win the November election,  yet that assumption is doing nothing to stem the flow.  

They're not just showing a lack of confidence in what Labour is already doing to the country, they've already factored in their expectations of how little a John Key administration will do to change the country, and they're expressing almost equal lack of confidence in what National will do -- which as we know is to do nothing and change nothing. 

In short, they've realised that Labour-Lite will be just is as bad for their future as Labour was.  And that's singularly tragic.

I'll say no more now, since I said much more back in May.  I'll conclude instead with a line from an excellent piece by one John Gardner, a North Shore voter who's only leaving the country temporarily, but who articulates well the wary plague-on-all-your-houses departing NZers must feel about the politicians who make their lives a misery:

    But come election time and the truth is nakedly revealed. In their heart of hearts they think we are backward infants rather than thinking adults.
    I'm glad to be freed from being treated with such disdain for a while.

Gardner is returning.  1 in 10 won't.  And National has nothing up their sleeve to stop that besides a billboard.

It's not just Labour who shoulders the blame for 'brain drain'

It's just tragic watching New Zealanders with get-up-and-go who are getting up and going to Australia.  These people were New Zealand's backbone -- skilled tradespeople, middle managers, nurses, teachers, young doctors.

With numbers leaving already in their thousands (and the graph at right from Bernard Hickey's site suggests the number is if anything accelerating), a recent poll suggests as many as 1 in 10 adult New Zealanders is "fed up with high interest rates, worried about the housing market, and want better wages," and is thinking about leaving the country to get them.

    Kiwis say New Zealand is no longer the safe and happy country they grew up in and many are fed up with being told how to run their lives, and not enough attention going on law and order and controlling crime.

Since these are all problems either manufactured or made worse by government, it's only natural the 'brain drain' has already become an election issue -- and the National Party DVD in which John Key stands in the middle of an empty football stadium to show the numbers that leave annually for Australia strongly suggests his party intends to make the transtasman exodus a major election issue. But as the Herald points out,

    National's right to point to the increase in the figures is not unqualified: Key may like to remind himself that when National took office in 1990 it inherited an almost-unheard-of transtasman net migration gain of 1200 which it managed to turn into a loss of almost 25,000 by the time it lost the Treasury benches to Labour at the end of the decade. The worst year ever was to March 2001, arguably as attributable to National as to Labour. And he might like to specify what precisely a National-led Government would do to turn the tide...

Precisely.  It's all very well playing "me too" to win an election, but it's no good when it's those very policies they're "me too-ing" that are driving people away.

And here's something that should really concentrate the minds of those in the National Party who want to use the trans-Tasman exodus as an election issue: since most people emigrate based on long-term expectations (and included in those expectation would be the quite reasonable assumption that National will win the November election), they're not just showing a lack of confidence in what Labour is already doing to the country, they're expressing almost equal lack of confidence in what National will do.  They've already factored in their expectations of how little a John Key administration will do to change the country, and they've realised Labour-Lite is as bad for their future as Labour.

In other words, the reason for that empty stadium John Key's using for electioneering is as much him and his party as it is Helen Clark. 

Think about that one.