This country may see a net migration outflow of 20,000 by the end of this year as the borders re-open, according to Kiwibank economists.
In their weekly First View publication, Kiwibank chief economists Jarrod Kerr, senior economist Jeremy Couchman and economist Mary Jo Vergara, say that as the country re-opens to the rest of the world post-Covid, the net outflow of migrants "is expected to deepen further before eventually recovering".
They note that NZ citizens can already enter the country without the need to self-isolate. From April 12 "our Aussie mates can do the same" - in addition to people on temporary work and student visas. From May, visa-waiver countries will follow Australia. And by October, the border will fully open to all visa categories. At present, arrivals are still subject to pre-departure covid tests, and the requirement for RATs within the first week of arrival.
"The roadmap is certainly welcomed by tourist operators and education providers. The Government's roadmap is subject to change of course. The planned opening of the border to Australians has already been brought forward for instance," the economists say.
However, they note that the phased timing of border reopening is expected to "throw the net migration figures around" over the next 12-18 months.
"Long-term departures are forecast to increasingly exceed arrivals over 2022," they say.
"The assurance that Kiwis moving overseas can return home without the need for MIQ is expected to rekindle the desire for the big OE.
"Annual net migration outflows could reach 20,000 by the end of the year. That's similar to the last period of major outflow seen back in 2011, when an Aussie mining boom attracted Kiwi across the ditch for prospect of a six-figure salary."
Other economists have been offering similar views about Kiwis likely leaving the nest in considerable numbers with the opening of the borders. ANZ economist Finn Robinson and senior economist Miles Workman said in a recent report that "there’s a real risk that the staggered reopening of the border sees a large net outflow of Kiwis over 2022. This is especially the case given that the outlook for the Australian labour market has improved significantly".
Kiwibank's Kerr, Couchman and Vergara say that in contrast to those people choosing to depart the country, the economists say, long-term arrivals "will be held back" by the gradual reopening of the border.
"Prior to Covid, the top three sources of non-NZ arrivals were China, India, and South Africa. And all three are non-visa waiver countries," they say.
"In fact, applying current visa-waiver settings to non-NZ migrant arrivals data shows that most arrivals pre-Covid came from non-waiver countries (see chart below). The border will reopen to these countries from the December quarter. In the meantime, arrival numbers will be held back. From the December quarter we are picking long-term arrivals will start to meaningfully lift, and eventually lead net migration to return to an average of around 30,000 people per annum.
"That's higher than the long-term average, but well down from pre-covid highs."