The much-vaunted brain drain to Australia is no worse than it has ever been, and is actually smaller as a proportion of New Zealand's total population than it was 40 years ago, a major study by the Department of Labour has found.

That's despite 44,000, or 1 per cent of the country's population, leaving for Australia in the year to June 2011, following a tough year of recessionary conditions and the worst of the Christchurch earthquakes, the report, Permanent and Long Term Migration: The Big Picture, says.

At the end of the 1970's, the departure rate to Australia was equivalent to 1.4 per cent of the then population of around 3 million, compared with around 4.5 million today.

The report also shows more people have been arriving long term in New Zealand than departing since the 1990's, with the loss of New Zealanders to other lands being made up by migrants from elsewhere.


Released this morning, the report concedes New Zealand has been losing about 4000 more people than it gains in the short term this year, but that this is likely to reverse early this year, particularly as the Australian economy slows.

"Departures to Australia are forecast to ease later this year," said the general manager of the department's Labour and Immigration Research Centre, Vasantha Krishnan. "We forecast a return to a net migration gain of about 6000 during mid-late 2012 and early 2013."

As to longer term trans-Tasman migration, the report says "New Zealand's population growth provides context to the relative size of migration flows to and from New Zealand but is often overlooked."

"This paper shows that when population size is considered, trans-Tasman departures relative to New Zealand's population are lower now than they were in the 1970's".

Still, some 495,000 Kiwis are now estimated to be living across the Ditch, around half the 700,000 to 1 million who live outside the country, meaning one in 10 New Zealanders live in Australia.

The report's long term migration flows analysis also shows a 10 year cycle which has become established since the late 1940's, in which net population losses have peaked around the end of each decade, followed by periods of net inflow.

The highest net losses were between 1976 and 1982 and again at the end of the 1980's - both of which were periods of economic stagnation.

"The period from 1990 onwards has been characterised by net gains rather than losses, although there was an end-of-decade net loss between 1999 and 2001," the report says. "Since 2002, net migration has been positive".


Separately, the department's latest migration trends and outlook report, also released today, finds India is now the second largest source of new long term or permanent migrants to New Zealand, thanks to a combination of skill shortages and arrivals by international students for multi-year courses of study.

The trend comes as the government embarks on negotiations for a free trade agreement with India.