By Paul Spoonley*
(This article is part of Interest.co.nz's Election Series).
COVID-19 has provided something of a welcome pause to a number of things, not the least, immigration. In the 2006-13 period, the total net gain was 35,000. Large net outflows, especially to Australia (remember the loss of 53,800 departing permanently for Australia in 2012 alone) has been followed by a period of the highest inward migration ever, and the highest net gains : 330,000 between 2013 and 2018. There was a dip as the Labour-led government began to impose new rules on arrivals but by 2019, the net migration gain was as high as it ever been.
To put this into perspective, New Zealand’s net gain last year was 11.4 migrants per 1000 population; Australia is around 6 while the UK or the USA are around 4 per 1000. Apart from these very high rates, there were also shifts taking place. There had been a much higher emphasis on temporary migrants, everything from the Recognised Seasonal Employment scheme for the horticultural sector (which had been increased to 14,500 this year although, because of COVID, only 9000 arrived) through the various temporary work schemes (the Holiday Working Visa) to Essential Skills visas. On top of this are the student visas, more than 100,000 of them, who can work up to 20 hours per week. At the time of lockdown, there were 310,000 people in New Zealand on these various visas.
The result is that the overseas-born proportion of the New Zealand population has been increasing (27.4% in the 2018 census) while more than 40% of Auckland’s residents are overseas-born. Over the last 20 years, but especially since 2013, a number of sectors and employers had become reliant on migrant workers. New Zealand’s annual population growth has been around 2% (again since 2013) with two-thirds of this growth coming from net migration.
COVID presents a moment when some questions can be asked about the role and rate of migration in New Zealand over coming years and decades, although these issues should not be (in my opinion) addressed in isolation from general population issues which I will come to in a moment. But this discussion about migration needs to factor in what is happening elsewhere, both in relation to mobility and border control and to population trends more broadly. I notice that British Airways recent assessment is that air travel will not look anything like pre-COVID rates until 2023 and even then, there are questions about numbers and where.
The last decade has signalled some major changes to New Zealand’s population. Baby boomers started arriving at age 65 in 2010 and they will double the numbers in this age group to over 1 million in the next decade (the numbers aged over 85 will triple). But at the other end of the life cycle, fertility is dropping and is now at a sub-replacement rate in New Zealand. (The number of births in New Zealand last year was insufficient to replace our existing population). Some talk about a fertility implosion or baby bust. Th effect of these two changes are that we seeing an inversion of the typical population pyramid of mid-last century. Soon there will be more over 65 year olds compared to those aged under 15.
This raises some critical policy and funding questions. One is about the size and nature of the prime working age population and whether it is adequate (in terms of skills, location, availability) to meet our labour demands now and in the future. The second is the cost of an ageing population – do we have adequate healthcare facilities? Are the current superannuation arrangements (funding, universality, lack of means testing) appropriate and/or able to be paid for, especially in the future? Let me offer one example. In the next 6 years, we will need somewhere between 12,000 and 20,000 additional Long Term Care (LTC) beds in New Zealand to care for our rapidly ageing population. Currently, the government pays the majority of the costs for LTC. Who is going to build these facilities (and where) and who pays?
There is one other element of New Zealand’s population that needs to be acknowledged : the growing concentration of the New Zealand population in the top half of the North Island and especially in Auckland. We are forecasting that 60% of New Zealand’s population growth through to 2040 will occur in Auckland, with overspill into Hamilton and Tauranga. This need not happen but it is. There is a modest outflow from Auckland to other regions (mostly to Northland and Waikato) but the arrivals (returning New Zealanders, young adult migrants from the regions, immigrants) easily outnumber this outmigration from Auckland and contribute to one of the highest city growth rates in Australasia.
This is made even more stark by the population stagnation – and decline – of two-thirds of New Zealand’s territorial authorities. There is modest growth in the major towns in the regions but once you get to Kawerau, Ruapehu or Wairoa, then there is already population decline - as there is for the West Coast. These parts of the country are experiencing an annual population loss of 1%, which does not sound much but it becomes significant over the longer term. And the population that is left is ageing (often 30% or more of the local population). This rural or regional depopulation is common in high income countries and New Zealand is late to the party, as it has been in relation fertility decline. But it is here now and will become more apparent by 2030.
This leaves immigration. We changed our policy approach and framework in 1986-87 but the experience through the 1990s was not great. Lianne Dalziel as the minister made major modifications after 2000. We modelled much of what we did on the Canadian and Australian systems although we share more with Canada these days and less with Australia, especially in relation to the politicisation of migrants and refugees, the withdrawal of various rights for New Zealanders living and working in Australia and the insistence on testing values and adopting citizenship.
Given that the last major review and changes to our immigration framework took place just after 2000, it is time to have another look at our policy framework, especially given the implications of COVID-19 (the need to adjust our training and labour market matching to get New Zealand residents back into work, the significant net population gain that will arise from returning New Zealanders, something that has been extremely rare in our migration history, and the need to think about the mix of migrant work skills and where they might go – sector but also residence). Immigration will remain important for the future of New Zealand, partly in order to fill skill and labour gaps, partly to contribute to innovation (see the work by Dave Maré and others) and partly to compensate for the major demographic transformation that is occurring.
A quick look at the party manifestos does not inspire confidence that this complex set of factors and influences, or in anticipating the future that we are facing is going to considered (or considered adequately) and that there are policy options on the table. This is partly because there are some immigration policy statements missing (Labour) while some are confusing in terms of having some interesting talk points but detail is either limited or there are elements that appear not to be informed by the available evidence. I am puzzled by ACT’s New Zealand values test (which values are we talking about?) or the focus of National on tertiary students but no indication of numbers in relation to particular visa categories more generally. The Greens have the most comprehensive statement on immigration.
Immigration is part of a complex shift in our population structure that is occurring. It would be helpful to talk about the implications of both ageing and declining fertility alongside the redistribution of the country’s population as well as immigration. We need to talk about growth rates (in relation to various population elements rather than an overall population number), the pipeline and source of skills and productivity, and regional dynamics. Taking a long term view would all be helpful. But I want to end by talking about global trends.
New Zealand, as I have already said, is near the back of the queue in terms of fertility decline, ageing and the depopulation of regions, although at the head of the queue in terms of net migration gain. The 2020 UN report on population trends makes the point that the demography of countries and the world will change dramatically this century. The global population will grow until the 2060s but will then decline. Already, countries such as Poland, Japan, Italy and Portugal are likely to halve in population size, and well before the end of this century. As this population contraction – and ageing – occurs, more and more countries will look to attract qualified workers to make up shortfalls. And some of the current talent pools will not be able to supply. China already has a much lower fertility rate than New Zealand and will be the first country to age before it becomes rich. China has moved from experiencing demographic gains to demographic deficits after 2015.
All this suggests that we need to have a comprehensive and informed discussion about population change and options – but it might not be the right moment during this election period unfortunately. But we do have to have this discussion and sooner rather than later.
*Distinguished Professor Paul Spoonley, Massey University, has just published a book, The New New Zealand. Facing Demographic Disruption (MUP, August 2020). He is a lead researcher on the Capturing the Diversity Dividend of Aotearoa New Zealand research programme (2014-2021) and a Senior Affiliate at Koi Tū : Centre for Informed Futures, a newly established research centre led by Peter Gluckman. He is a Fellow of the Royal Society and Auckland Museum. He is a Visiting Researcher at the Max Planck Institute for the Study of Religious and Ethnic Diversity and was a Senior Fulbright Scholar at the University of California Berkeley.
81 Comments
Lower birth rate for the educated, high for those who are not.
A welfare system that encourages breeding to gain greater access to the goodies.
Why is dealing with this shambles of a welfare system always considered an attack on these people? It's not their doing as such...their's is a rational response to short sighted policies.
Very true. I know many folk who are young, pretty well paid professional couples yet they are only having one child because 1) it took too long to achieve financial stability initially, pushing their childbearing years later in life, and 2) they just couldn't see the financial viability of having more children. All because we've had the central government and bank pushing house prices up for the last decade or two.
It is ridiculous and abhorrent that scarce regard has been given for the negative effects on society of pushing house price and household debt increases. People have only constantly celebrated this decline of living viability in NZ because it's benefited them personally, with little regard for wider and longer term effects on NZ society.
Completely wrong. Why the poorest people on earth have so many more children? it is the much higher expectations of wealthier, higher educated women that prevents them (on average) to have many children. Women like their financial independence and that would require committing to their careers. Even when they love to have children, it means that they will realistically will have 1-3 kids. Some will have none.
If you do not have high expectations for yourself, your spouse and your offspring, you can have children at any time and as many as you like.
See 'Factfullness' by Rosen - good explanation with plenty of data that argues absolute poverty equates to as many children as possible but just raise income from <$2 per day to say about $10 then they are still very poor but their children get education and family sizes drop to roughly 2 or 3 per family. Examples are drastic reduction in family sizes in Iran, some Indian states and parts of Africa. At present the number in absolute poverty has dropped and did so faster than expected by the UN - however there are about 1 billion in absolute poverty, 1 billion wealthy similar to average in NZ (>$32 per day) and 6 billion in between. It is the in between that gives us hope - typically they aim for small educated families.
It's a good book. I've also seen it first hand working in the development sector in a developing country in a past period of my life. A little bit of opportunity and a little bit of empowerment with control over one's reproductive cycle at the same time, and things can change quickly.
Wrong. Lower birth rates are the result of women being able to control their own fertility, their ability to become educated and their ability to follow other paths than motherhood, and given those choices a good many of them do not choose motherhood. The planet needs way fewer of us, this is something to celebrate.
Economic common sense demands that we need more young people to pay for the old people. Clearly, we must import or breed humans until the entire planet is a pulsating ball of human flesh. The economic consequences of not doing so would be disastrous -- high taxes, low growth, asset depreciation...
Im not sure this article says much apart from being another pro-immigration propaganda piece by Professor Spoonley. At the end of the day, for the large part, we have been running a mass immigration program that is far too large for the last 30 years, making existing NZ'ers poorer as a result. This is no disrespect to immigrants, all of whom are just looking for a better place to live for them and their families. But we will never have a shortage of people wanting to live here, we are a relatively rich (although slipping comparatively) country with a good standard of living. If NZ as a whole wants to help those looking for a better life, then raise the refugee quota and stop hiding behind some rubbish "skills based" quota system that is apparently economically based.
Time to have a reset for sure.. to much lower levels.. regardless of demographics/outward migration/global trends. Really is that simple.
To be fair, I was expecting it to be 'another pro-immigration propaganda piece by Professor Spoonley'. But I was pleasantly surprised, I don't think it was that at all.
He canvassed issues such as re-training kiwis in this covid world, which implies a move towards less immigration.
:) you think skilled migration is an alternative for refugees? next time you went to hospital or your medical center, just see how many of them are born overseas.
Go look at skilled immigration list and let me know which one of them are not needed.
I think you are confusing the fact that a lot of people get work visas for things like restaurant management and retail management with the skilled immigration path. See medical practitioners, IT, science category, engineers, trades etc standards that are needed for skilled immigration.
It is an absolute boon for NZ to get skilled immigrants.
Not confusing anything. Again.. i have nothing against the immigrants themselves and have benefited from the care/knowledge/skills of many. My issue is that instead of allowing wages to adjust to efficiently allocate resources, we allow businesses to lobby govt for access to foreign labour that suppress wages in that area. Rampant population growth puts massive pressure on limited resources.. half the jobs on the long term skills shortage list are to try and catch up the infrastructure deficit we are in as a result of immigration left unchecked.
""It is an absolute boon for NZ to get skilled immigrants."" that is true but only 27% of permanent residents fit that criteria and INZ does class chefs and tourist guides as 'skilled'. If they were truly skilled then they would earn above the average wage and on average they don't.
Although I agree with your list (in fact I have a relative by marriage who is an immigrant consultant Electrical Engineer) it is noticeable that some successful countries manage to fill these skilled positions with far fewer immigrants than NZ - something to do with training and pay incentives.
So I was happy when immigrant medical staff saved my wife's life with her cancer treatment; not quite so happy when a court case discovered immigrants working in a local restaurant earning under $6 per hour for 60 to 80 hour working weeks. The owners were prosecuted but escaped punishment.
Yes I agree with you. And as said before, that is crazy. No one will die because there are less number of Burger Kings around. It will possibly be the opposite. It is crazy if they are let in as "skilled immigrants" where the shortage list does not even have them. So I do not understand how can they be designated as such?
But you still cannot equate that with refugees.
All i was saying that that at the moment, we let in thousands of ppl under the guise they are "skilled." They arent (of course there are skilled ppl, but they are the minority), and the net macro effect over a long period is that existing NZ'ers get poorer as a result than they would have otherwise been. So if NZ decides they they want to do this (ie be a good global citizen.. as i can see that being the only good reason), then increase the refugee quota (probably get some highly skilled ppl while we are at it) and dial back the residency approvals.. as there arent enough willing highly skilled applicants to fill the spaces..
It was informative and rational but left out issues that are part of the immigration/population debate. Most importantly the issue of exploitation of low-paid immigrants; this was described by Prof Christina Stringer's 2016 report. Secondly the negative effects low-paid immigrants have on the native low-paid workers in terms of wages, opportunities and training - this has been described by reputable liberal economists such as Paul Klugmann and Herman Daly but is just common sense. These are moral issues and therefore more important than a discussion of how New Zealand's prosperity is advanced or held-back by the number of immigrants.
Great article, and agree fully - that we need a discussion. (Just seem Timmyboy's comment - yes, we are overshot. Yes, it's on the basis of draw-down. Maybe this fellow isn't thinking of that, but in opening up the discussion he's on the right track)
I have a slight quibble about projecting to-date graphs forward 'We are forecasting that 60% of New Zealand’s population growth through to 2040 will occur in Auckland' but bring it on.
Look forward to this being progressed. Even if he's about immigration himself, the discussion will move on from there. Carrying-capacity is the criteria and by the time we've finished, a lot of 'givens' will have gone out the window.
Carrying Capacity is the "ultimate" test
In the 20 years since 2000 the gap between rich and poor has increased
Does that mean immigration has not produced the expected dividends?
What were the expected dividends?
Sure, the nabobs can squeeze another million in - at what cost? - that gap will increase
So, whats the point
Immigrants are great. These are people who want to become *like you and to respect your culture and values.
Colonists are not so great. These are people who don't want to become like you and who despise your culture and values.
New Zealand should not accept colonists. Ask the original immigrants to these lands how that worked out for them. //
*"like" does not mean "identical to."
The issue with 'informed discussion' and 'earnest consideration' - chiefly by academics and Gubmint pooh-bahs (but I repeat myself) is that these fora are emphatically not the places where actual decisions about reproduction and immigation/emigration take place. Yes, there are the Policies re immigration which act as a very broad-brush filter - more of a Colander, really - on incoming headcount and skills. But the real decisions outside that realm are made in private circumstances, on- and off-shore, have long lag times before effects show up in mass stats, and are irreversible in some cases (births of humans or births/deaths of businesses). These private decisions are influenced by a plethora of factors, mostly not under Gubmint control or even surveillance: climate, family, business niches, the Four Horsemen, and of course culture, biological urges, and risk appetite.
Good luck with the talk-fests, but they miss the nexus......
The nearest lever the Gubmint has can be summed up in the phrase 'you get More of what you Pay for'......
Prof Spoonley's extrapolations are must be based on the assumption that our benefit system will remain unchanged. Currently it is strongly biased against the two parent family.
Recently I was trying to help a neighbour with financial woes. She has a child and her partner both have a child from previous relationships and they had a child of their own earlier this year. She is on maternity leave but used to earn above the average wage and he earns less. He resides in Hamilton and she is in Auckland. Using the WINZ benefit calculator [ https://check.msd.govt.nz/ ] if they are in a 'relationship' she gets a total of $421pw which is way less than her rent but just declare her as a single mother and she would get $939 . This does not encourage the traditional two parent household.
The govt website has an interesting definition of 'relationship'. My social worker family member tells me her clients are strongly recommended to not admit the father's name - that may be to prevent his ever having to pay child support as well as greatly increasing benefits. I recommended just trying that benefit calculator imagining any young couple with kids and you soon find govt policies do not help preserve traditional family structures. The only solution I can find is a generous universal child benefit (which would put taxes up so no party supports).
Do we need more skilled young people that want to live and pay tax here...sure, note that is not cooks, bottle washers and taxi drivers. Our tax loss to date raised youth have been looking at the property ponzi here and job opportunities in front of them, and simply voting with their feet. Elsewhere. Clearly this is a limited option at the moment. Do we need and infrastructure plan before we add another million that no one voted for.
Opening the flood gates again is taking the path of Sweden - goodby grandma and grandpa. No one will want that and will vote for it. National policy is flood gates open to protect the banker profit and asset speculation, Labour is probably the same, NZF talk low numbers but in the last cycle have been proven to "totally porky pied" their bottom line promise.
Who does that year with an alternative. Read the TOP immigration policy.
"Fertility is dropping and is now at a sub-replacement rate in New Zealand. (The number of births in New Zealand last year was insufficient to replace our existing population). Some talk about a fertility implosion or baby bust."
Partly incorrect. It's not that fertility is dropping, It's that the cost of living in NZ is far too high particularly in our larger cities is deterring women from wanting children, so they're having to put off having children to much later in life when they can just about afford it which results in less fertility. And couple deciding well we can't afford them anyway so why bother.
What we need to do on immigration-
- Cut down the amount of PTEs that exist only to issue students with useless level 5-7 qualifications. So many of these on Queen st. Student Visas should only be available for universities
- Tougher test on skill shortage criteria and work visas. Apart from rural/seasonal workers work visas should be for jobs that pay double the median wage. No more tourist bus drivers coming in on work visa. This should be combined with increase costs on application for a work visa
- Rejig the point system so you get more points if you spend the first 5 years of your new life in NZ outside of the big centres
In some European countries any profession that becomes dominated by immigrants is identified and immigrants prevented working it that area. That helps to stop exploitation. Of course Indian restaurants will tend to be staffed by recent Indian immigrants but it should be possible to find more restauraunts run by NZ born staff. Note this is mainly a low-paid issue - I'm not so troubled with the many PI professional rugby players on large salaries.
I am puzzled by ACT’s New Zealand values test (which values are we talking about?)
How about values like respecting the human rights of gays? As opposed to throwing them off rooftops. 50% of a particular immigrant group LIVING IN THE UK believe that homosexuality should be illegal. No thanks to that.
It's good that we might finally get some control over our population growth. We need to think about how many people these islands can support (e.g. land per capita, ability to offset the greenhouse gasses people emit etc.) That would be a truly sustainable way to think about our future.
Interestingly, the crowd he's associated with put this out:
https://informedfutures.org/wp-content/uploads/The-Environment-is-Now.p…
As with their food one, they don't do energy well (the food one didn't mention Ag's reliance on fossil fuels, this one conflates a renewable grid with renewable everything - amateur errors). But by and large, same thing; good starting-point for the debate we need to be having. I particularly liked this from p12: "Systems thinking is needed rather than seeking individual silver bullets for different sectors and issues".
Bring on the discussion
The gift that kept on giving
Immigration NZ just kept on giving this guy permission to import low paid workers 107 times
Bottle-O baron accused of exploitation obtained 107 visas for migrant workers
https://www.stuff.co.nz/business/122386866/bottleo-baron-accused-of-exp…
What Paul failes to acknowledge is that western populations are exploding due to high immigration rates because of the debt based asset inflation economy. Why in a world with more technology do we need huge population gains.
Look Paul believes strongly in mass migration and multiculturalism. That's totally fine but he just harps on about we need more people we need more skills. The same way a heroine addicted person needs more as if its a good thing. Drug addiction and addiction to cheap credit is the reason for mass immigration.
As we blow up Assets and debt levels to insane levels we need more and more people and cheaper labor so debt can be serviced and business can survive.
The greatest immigration experiment since Saharto's transmigration to Papua. "To put this into perspective, New Zealand’s net gain last year was 11.4 migrants per 1000 population" in contrast the birth rate in New Zealand in 2018 was 12.635 births per 1000 people. Let's completlely change our population mix with no mandate from the poor old voters.
The writer offers good data that governments do not want to discuss, let alone debate at an election.
Populations and societies are NOT offered a choice about how large they want their pop to be and in addition we are not told in any "public policy debate" (where? on what media? TV is utterly useless as a platform for this and its editorial teams are only interested in advertising revenue shrinking as internet sucks it away). Ageing pop is going to suck demand from lots of things but esp house buying, as the pop of Auckland aged 25-54 is going to fall between 2018 and 2023, never mind the CV19 effect. hence, home ownership and house buying will continue to decline in Auckland.
Good article. I am not sure that this bit: "New Zealand is near the back of the queue in terms of fertility decline, ageing and the depopulation of regions" is correct. New Zealand's natural increase is +0.6%/year, while 25 countries are negative. In the EU, only two countries (Iceland and Ireland) have higher natural increases, and then only slightly. The population debate should also look at its interaction with the environment and the overall need to move to a steady-state economy.
Paul and many commenters here seem to have a fixation with Auckland dominating population growth and want to go against the “laws of nature and economics” and spread population around the country more. The worst thing the govt can do is provide artificial incentives to move people out of Auckland. The agglomeration effect and economies of scale are the reason Auckland keeps growing (coupled with a much too high level of overseas migration imo). Sure, in recent years there has been a smallish exodus from Auckland by NZers but that is consequence of poor planning resulting in congestion and unaffordable housing. Water can be sorted out, recycle the damn stuff if need be. Singapore drinks it’s purefied waste water.
In sustainability terms, Singapore is stuffed and Auckland is seriously questionable. So many don't get the urgency of the cascading issues approaching us. I don't understand anyone who witnessed Deepwater Horizon, Fukushima, the Aussie bushfires, the collapses in so many countries, the refugees streams, the de-focusing of so much western leadership, the climate and the waste-effects, yet makes comments assuming something resembling the status-quo.
Singapore may be stuffed long term sustainability-wise but I'll wager that you'll be surprised how long money and technology can pay off the piper for.
On another note all the woes you mention are merely symptoms of overpopulation. The former is near impossible to solve without addressing the later. My biggest beef with most economists and politicians is their inability to envision and embrace a country or world with a declining human population. Hence why NZ and the west relies on immigration to keep the population growing in order to keep consumption of goods and services growing and total GDP rising. If there is no other way to continuously improve our quality of life we are buggered.
Artificial incentives to move people out of Auckland? Surely it is the reverse that we have lived with for many years. These are the Accommodation Supplement upper limits from the govt website:-
(a) $305 a week, if the applicant resides in Area 1:
(b) $220 a week, if the applicant resides in Area 2:
(c) $160 a week, if the applicant resides in Area 3:
(d) $120 a week, if the applicant resides in Area 4
Guess which area Auckland is in.
On another note I agree this is a relatively balanced piece by Paul and strongly agree that we need an informed discussion on this issue - particularly one where those (like myself) who would prefer much lower levels of immigration are not castigated and shut down but given a fair hearing.
2060 is not that far away really. This is the big monster floating for all in the world and will change the whole world economy when there is no more growth - just renewal and lots more older people who all live in urban areas with less and less people in rural areas. Another chapter in the history of the human species.
Both de-growth and population reduction will be well underway before 2060. And the world 'economy' is beyond 'debt repayable' already.
Interesting times. Well, de-interesting times. Because the trend to - and below - zero interest is one of the indicators of the inability of the planet to underwrite growth, already already.
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