The BulletinJune 13, 2024

‘Brain drain’ déjà vu as New Zealanders leave the country in record numbers


Over 81,000 New Zealand citizens left the country in the year to April – a 41% increase on the previous year. Stewart Sowman-Lund looks at why, in this extract from The Bulletin. To receive The Bulletin in full each weekday, sign up here.

Leaving home

Back in 2020, The Spinoff produced a six-part podcast series called Coming Home. It was focused on the influx of New Zealanders returning to Aotearoa during the Covid-19 pandemic, and it had a pretty optimistic tone. It’s still worth a listen if you missed it, but that podcast could not be made today. Because new figures from Stats NZ show people are leaving the country in record numbers. Eva Corlett at The Guardian has the key details, reporting that the 130,600 migrant departures was the highest on record for an annual period (though net migration showed a gain of 98,500, up from 85,800 a year ago). However, of those leaving the country long term, about 81,200 were New Zealand citizens – a 41% increase on the previous year. “With 24,800 New Zealand citizens arriving during the period, that put the net migration loss of citizens at 56,500 – exceeding the previous record of 44,400 in 2012,” Corlett wrote.

What reasons are there for the drop in migration?

These latest numbers aren’t a particular surprise, given there has been an ongoing trend with migration data in the aftermath of the pandemic. Last month, Q+A’s Jack Tame analysed the May data that showed more than a thousand New Zealanders were leaving the country every week. The headline on Tame’s piece was fairly provocative, asking “who could blame” people for deciding to leave. But he posits a number of reasons for the rise in international migration. The job market, for one, with rising unemployment. Then there’s the high cost of living here, specifically for those renting. “This renting generation, coincidentally, is the same generation most likely to have left New Zealand,” wrote Tame. In late April, rents were recorded at an all-time high, according to TradeMe. Conversely, house prices have “plummeted”, according to Newshub – though let’s remember Hayden Donnell’s view on reports like that. Economist Brad Olsen told The Guardian a number of younger people will be leaving the country for an overseas experience, but some will have been lured abroad with the promise of better housing and job prospects. Enter, the “brain drain”.

We’ve been here before

While you will probably picture the early 2000s when you think of the brain drain, a quick search through Papers Past reveals it’s been a concern on many prior occasions. In 1969, for example, The Press reported that “3,863 professional and skilled workers left New Zealand for more rewarding opportunities overseas” while “2,000 immigrants helped offset this brain drain”. Prime minister Christopher Luxon was quick to remind people yesterday that we’ve been here before. “You’ll remember in the early 2000s there was a massive exodus of New Zealanders to Australia, and other parts of the world,” Christopher Luxon told reporters at Fieldays. “Our job is to build a long-term proposition where New Zealanders actually choose to stay in this country.” As this Stuff report from 2011 illustrates, the political response at that time was similar. Former finance minister Bill English said: “We know roughly what the recipe is, policies that support businesses that want to employ and create opportunities, that provide people with skills and reward those skills,” he said. Compare that to what Luxon said yesterday: “By building good economic management, a safer society, better public services, New Zealanders came back.”

Last month, RNZ’s Giles Beckford looked at the latest round of unemployment data, reporting that the number of unemployed people was estimated to be 134,000 – or 4.3% of the working population. As he wrote, the rise in unemployment can be linked to a slumping economy. “Throw in inflation pushing through 7%, and the Reserve Bank hiking interest rates to slow it down, the economy was bound to slow,” he wrote. A few days later, his colleague Susan Edmunds reported that the peak of unemployment could see a further 26,000 without work.

Is the grass really greener?

With high unemployment usually comes a struggling economy, something I’m sure will come as no surprise. A statement from Kiwibank’s economists yesterday said 2024 hasn’t got off to a good start. “We continue to expect the rest of 2024 to be a year of low growth, as high interest rates continue to depress demand,” they said. Social development minister Louise Upston told RNZ’s Giles Dexter in March that the economy being in recession could see our “best and brightest” choose to head across the ditch, something that’s been picked up on in Australia. We talked recently about the concerns Australia was attempting to poach New Zealand workers, especially from areas like education and law enforcement. The Spinoff’s Shanti Mathias looked at that in-depth almost a year ago. According to the Herald’s Liam Dann, there was a provisional net migration loss of 24,200 people to Australia in the year ended September 2023.

This report from the ABC last month (which was before the coalition’s first budget) focused on the state of our economy, the growing job cuts in the public sector and growing unemployment, concluding that “the appeal of higher wages in Australia and a chance at citizenship has seen the number of Kiwis making the move increase”. RNZ’s Susan Edmunds took a look this week at whether the grass really is greener in Australia, reporting that the average full-time weekly earnings were A$1,953.70 in November last year, compared with $1,558 in New Zealand.

Keep going!