ANZ has released research showing that a large number of Kiwis are moving to Australia for better job opportunities.
“The labour market is slowing much faster in New Zealand, with the unemployment rate up 1.1ppt since its post-COVID trough”, noted ANZ senior economist Blair Chapman. “In Australia, the unemployment rate has only increased by 0.6ppt since its trough”.
“The RBNZ is forecasting the unemployment rate to increase to 5.1% by mid-2025, while we and the RBA expect Australia’s unemployment rate to peak below 4.5%”.
“Last financial year, net migration from New Zealand to Australia was at its highest since 2012-13, which was the last time its unemployment rate was above Australia’s”.
“More timely New Zealand data on migration suggests that the number of New Zealanders coming to Australia was even larger in 2023-24”, Chapman wrote.
Chapman also noted that the “higher levels of net migration from New Zealand… will add to labour supply, reducing upward wage pressures, especially as New Zealand has similar qualifications, institutions and language to Australia”.
As shown in the following chart, Australia’s unemployment rate was lower than New Zealand’s in the first quarter of 2024.
This represented a change from the average rate from 2014 and 2018, when Australian unemployment was 0.7 percentage points higher than New Zealand’s:
Furthermore, while the Australian economy is struggling, New Zealand’s is significantly worse.
New Zealand’s per capita GDP in Q1 had fallen by 4.3% from its peak in late 2022, following six consecutive quarterly falls.
High-frequency labour market indicators in New Zealand are even worse than in Australia, with job advertisements crashing and applications per ad skyrocketing:
With macroeconomic data like that, who can blame Kiwis for leaving?
