It will now be tougher for would-be migrants to gain residency under the skilled migrant and family sponsored categories.
Immigration Minister Michael Woodhouse today announced that fewer residence approvals would be planned for the next two years, with levels down to 85,000-95,000 from 90,000-100,000.
The number of points required for residence will also be raised from 140 to 160 points under the Skilled Migrant Category and the number of places for the capped family categories would be reduced to 2000 per year from 5500.
Last year, 52,052 were granted residency, up from 43,085 the previous year.
The changes were made following a review of the Government's New Zealand Residence Programme (NZRP).
The programme sets a planning range for the total number of people approved residence over a multi-year period, and determines the proportion of residence places allocated to the different residence streams.
"Increasing the points required to gain residence from 140 to 160 will moderate the growth in applications in the Skilled Migrant Category and enable us to lower the overall number of migrants gaining residence," Woodhouse said.
"Changes to the Family Category, including temporarily closing the Parent Category to new applications, will also reduce the total number of migrants being granted residence."
Around half of those approved under the residence programme came through the skilled migrant category.
"Raising the points will also prioritise access for higher-skilled SMC migrants, ensuring we strike the right balance between attracting skilled workers that allow companies to grow and managing demand in a period of strong growth," Woodhouse added.
New Zealand Association for Migration and Investment chair June Ranson said compulsory English language testing would make it an uphill task for people from non-English speaking countries to gain residence.
"The new English language requirement will almost certainly count Indian and Chinese chefs out," Ranson said.
"This change will also eliminate those who do not hold a qualification and do not have occupations on the skill shortage list.
"We are concerned that companies trying to recruit tradespeople will struggle."
Ranson said the temporary closure of the parent category would also be problematic.
"Many highly skilled migrants will want confidence in knowing that they could sponsor their parents in the future," she said.
"Strong family units are vital for social objectives."
David Cooper, director of client services at Malcolm Pacific Immigration, said those without any university qualification would struggle to reach the required 160 points "no matter what experience" they had.
"A 50-year-old chief executive who may have run big public companies or multi-national companies overseas ... without a university qualification there is a good chance they will not qualify for a visa right now," Cooper said.
But BusinessNZ chief executive Kirk Hope welcomed the changes and said it would help prioritise the more highly skilled immigrants.
"Increasing the points required ... will help sharpen the annual intake towards higher-skilled people," he said.
"Today's announcement is an encouraging sign of progress towards a migration system that benefits the workforce and New Zealand generally."
Hope said employers would also like to see the system sharpened further to ensure that in-demand skills remained a priority.
"More work is needed to ensure the criteria weightings of the points under the skilled migrant category deliver long-term economic and social benefits to New Zealand," said Hope.
The changes include:
• Changing the planning range for residence approvals for the next two years to 85,000-95,000 (down from 90,000-100,000)
• Raising the number of points required for residence from 140 to 160 points under the Skilled Migrant Category
• Reducing the number of places for the capped family categories to 2000 per year (down from 5500)