New Zealand is experiencing a significant outflow of residents as economic hardships push many toward more prosperous shores. Among them are Corey Ngaru and his partner Elian Lellimo, who recently relocated to Australia’s Gold Coast in search of better job opportunities and higher wages. Their departure reflects a growing trend, as 128,700 people left New Zealand permanently in 2024, marking the highest emigration rate on record.
Economic Challenges Fuel Mass Migration
New Zealand is currently facing its worst economic downturn since 1991, excluding the pandemic. The nation’s economy struggled in 2023, with HSBC ranking it the worst-performing developed economy of the year. Low productivity, poor policy decisions, and unreliable economic data have compounded the crisis, leading to widespread business closures and rising unemployment. The jobless rate has reached a four-year high, while the workforce saw its largest annual decline since 2009.
Meanwhile, across the Tasman Sea, Australia presents a stark contrast. The country’s economy remains strong, with unemployment near record lows and robust job opportunities, particularly in construction and mining. These favorable conditions have made Australia an attractive destination for many New Zealanders. Since 1973, citizens of both countries have enjoyed the freedom to live and work in either nation, leading to a long-standing migration pattern that has primarily favored Australia.
Currently, over half a million New Zealand-born residents live in Australia, and the recent surge in emigration suggests this number will continue to rise. Despite an overall net immigration gain, the numbers have dropped sharply, with only 27,100 net immigrants in 2024 compared to 128,300 in 2023.
Flawed Data and Policy Missteps Exacerbate the Crisis
New Zealand’s early pandemic response—marked by strict border closures and economic stimulus measures—initially appeared successful. However, these actions later contributed to surging inflation and skyrocketing housing prices. In response, the Reserve Bank of New Zealand (RBNZ) implemented aggressive interest rate hikes, leading to an economic downturn.
Shamubeel Eaqub, chief economist at Simplicity, compared New Zealand’s response to Australia’s more measured approach. While the Reserve Bank of Australia maintained relatively moderate rate increases, the RBNZ pursued a strategy that deliberately induced a recession. By May 2024, this goal had been achieved, leaving businesses and households reeling.
Further complicating matters, Statistics New Zealand has revised its data, revealing that the economy experienced more severe contractions in mid-2024 than previously estimated. The lack of real-time accurate data has made economic forecasting and policy adjustments more challenging. RBNZ Chief Economist Paul Conway acknowledged these difficulties, stating, “If we had perfect, accurate real-time data, it would affect how we communicate. Unfortunately, it’s not physics.”
Rising Costs and Social Struggles Intensify Migration
Economic instability has heightened financial hardship for many New Zealanders. A recent Salvation Army report indicated that 400,000 people required welfare support, the highest level since the 1990s. Food insecurity and homelessness have both increased, further straining social services.
Murray Edridge, city missioner for the Wellington City Mission, highlighted the severity of the situation: “There’s only a handful of occasions when life has been tougher for people than it is today. There’s talk of economic recovery, but for those struggling, relief feels very distant.”
Despite government efforts to address these challenges, relief remains elusive. The conservative administration’s latest budget focused on debt reduction rather than economic stimulus, leading to spending cuts. Lower tax revenue has also forced the government to abandon plans for budget surpluses over the next five years.
What Lies Ahead?
Both the RBNZ and the Treasury predict that upcoming economic data, set for release on March 20, may show slight growth in the final quarter of 2024. However, experts warn that any recovery will take time to reach ordinary households. The government is advocating for policies aimed at boosting economic growth, such as regulatory reductions, mining support, and tourism investments. Finance Minister Nicola Willis has emphasized the urgency of these efforts, stating last month that addressing economic challenges is a top priority.
For now, many New Zealanders are taking matters into their own hands by seeking opportunities abroad. While Ngaru and Lellimo plan to return home once they achieve financial stability, their departure underscores a broader reality: for many, economic survival means leaving New Zealand behind.
For further updates on New Zealand’s economic landscape, visit Daljoog News.