New migrants a different breed

By JULIE MIDDLETON Career Editor

The number of people migrating to New Zealand is heading for record levels.

But what appears to be a spectacular brain-gain will not be enough to push up house prices to the figures seen in the mid-90s, or prompt a national spending spree.

Young, less skilled people without families had led net migration - permanent and long-term arrivals minus departures - over the past 18 months, said WestpacTrust senior economist Paul Conway.

"Net migration is as strong now as it was in the mid-90s," he said.

In the January 1996 peak, 4855 people arrived to stay. Last November, 4020 migrants arrived but their impact on New Zealand life will be a lot different to the 90s influx.

In the 90s, the arrival of big-spending, middle-aged professional people with families was fuelled by political uncertainty in countries such as Hong Kong, Taiwan and South Africa. Southeast Asia's new-found wealth was also a big factor.

"This time it's not really the case," Mr Conway said.

Arrivals from North Asia made up much of the latest increase. Their skills were across the board rather than just professional.

Many of the new faces were students who regarded New Zealand as a safe and inexpensive place to be educated - 57 per cent of the increase in North Asian arrivals were aged 15 to 25.

They would spend a few years studying and then head home.

"I would see that as exporting education.

"They live frugally and disappear - they don't buy houses," Mr Conway said.

"They go flatting or stay at a hall of residence, and are less inclined to put pressure on the housing stock."

New social welfare rules passed in Australia in May making it tougher for jobless or redundant Kiwis to get benefits had forced many to stay at home.

This contributed to the improvement in migration figures.

When the economic going got tough in Britain and Australia, as was now the case, New Zealanders tended to come home.

Although wealthier and wiser than when they left, they did not spend large amounts on housing and goods as did new migrants.

But the margins of the housing market would still benefit, he said.

There would be less pressure on the labour market, giving employers more choice in a country with 5.2 per cent unemployment.

The education focus of many migrants would mean they were spread more around the country, rather than concentrated in Auckland as in the 90s.

"The migration change that we are seeing will be usefully counter-cyclical," he said. "The New Zealand economy is set to slow down a bit because of the world recession. But more people coming in will give the economy a lift."

WestpacTrust said that New Zealand was well on the way to reaching its annual target of 45,000 permanent-residence approvals, despite the Government's increase in the number of points needed to live here.

However, the bank said it was unclear how lifting the bar was compatible with the Government's proposed skill shortage work permit and the new talent visa - which would work outside the points system and was aimed to recruit foreigners who would earn at least $45,000 a year, probably in high-tech sectors.

Recruits would be eligible for permanent residency after two years.

Employers have welcomed the talent visa. The latest TMP Job Index Survey, which gauged employers' hiring plans for the first six months of this year, showed 54.5 per cent of them felt that the policy would have a positive impact on their ability to hire skilled staff.

Employers in the media, electronics, telecommunications, engineering and food industry were enthusiastic.