New Zealand net immigration sets another record in November

New Zealand's net immigration rose further in November, having topped a net 6,000 people for the first time in October. The acceleration in the last two months from already-high levels has largely been driven by a drop-off in departures, and to a lesser degree by a pick-up in overseas arrivals. The balance of trans-Tasman migration rose to a net inflow of 240 people, the strongest since 1991. 

Ongoing low departures and strength in arrivals will cause New Zealand's annual population growth rate to reach its highest pace since 1974. High population growth is helping to maintain a semblance of strong GDP growth. But at the same time, the preponderance of people in the labour market is keeping wage growth lower than it would otherwise be. 

Net immigration is expected remain strong for some time yet. But the current strength will eventually moderate. Many of those who arrived on student and temporary work visa will start to leave over the coming years. In addition, the balance of trans-Tasman job opportunities is now shifting, with Australia reporting strong jobs growth and a lower unemployment rate than New Zealand. If this trend continues, New Zealand will eventually become a less attractive destination. 

The tourism sector's strong run continued in November, with arrivals up almost 4% to a new record high in seasonally adjusted terms.