Bernard Hickey calls for a Productivity Commission Inquiry into whether record high migration actually improves per-capita GDP in the long run. The latest data suggests it's not working for the economy or the Government

Bernard Hickey calls for a Productivity Commission Inquiry into whether record high migration actually improves per-capita GDP in the long run. The latest data suggests it's not working for the economy or the Government

By Bernard Hickey

On the face of it, migration seems an unambiguously good thing for both society and the economy.

The migration boom since the late 1990s has undoubtedly made New Zealand a culturally richer and more diverse place. Could we imagine Auckland now without a Diwali festival or a Chinese New Year celebration? Could we imagine a night out without some delicious combination of Asian, Pacific and European food? I'm old enough to remember what Auckland was like in the 1970s and 1980s and it was a much less vibrant and varied place.

New Zealand's economy in the 1970s and 1980s was also much smaller and per capita incomes were much lower. But house prices were also much lower in actual terms and relative to incomes, and the motorways and trains and hospitals and schools in Auckland in particular were also much less crowded.

There has been a broad political consensus until now that migration was an unalloyed good thing, particularly the type of migration New Zealand pursued through the 2000s up until 2013, which was focused mostly on finding skilled migrants to fill the employment gaps in a mostly fast-growing economy with low unemployment.

Both sides of politics agreed to take in around 90,000 to 100,000 new permanent residents every two years. That is slightly different, however, to the number of long term migrants measured by Statistics New Zealand, which totalled 221,741 in the last two years to the end of August. That included students able to work during term time and on holidays after the rules were relaxed in October 2013. It also included holidaymakers and others on temporary work visas, who aren't subject to the same more exacting skills-based assessment for permanent residency.

Debate is now growing about the effects on wages of this surge of temporary workers and students, who are often taking low wage jobs in hospitality, tourism and dairying. Wages have been stagnant at the lower end of of the jobs spectrum for the last couple of years despite strong economic growth. Meanwhile, the record high net migration of 60,300 in the year to August has been a factor in Auckland's 25% house price inflation over the last year.

The economic theory suggests that bringing in skilled workers to fill the gaps that can't be filled by local workers should lift the overall productivity of the economy, and ultimately the wages and well being of everyone over the long run.

But a few people are now having second thoughts, particularly now that so many of the migrants - albeit many of them only for a year or two - are in lower skilled jobs and Auckland's housing supply remains constrained.

Two data points published over the last fortnight challenge the conventional thinking. Firstly, per capita GDP actually fell slightly in the first half of 2015 despite overall GDP rising 0.2% in the March quarter and then a further 0.4% in the June quarter. Hourly wage inflation is mired under 2%.

Secondly, the migration into Auckland in the year to August of 27,900 meant that migrants effectively soaked up all the 9,300 houses built over that period. That meant that Auckland's housing shortage of about 25,000 was not whittled away at all by the recent building boom. If anything it got worse because Auckland's population also grew naturally due to births outnumbering deaths by around 15,000. Auckland's population is currently growing at almost 3% per year, which is stretching all sorts of resources and forcing the Government to ramp up building of schools, hospitals and roads.

Strong migration has artificially juiced up GDP and house prices, at least in the short term. But does it actually work in the long run to make everyone richer?

The economists inside the Treasury have begun asking that question and the answers are a little unsettling.

Economist Julie Fry wrote a working paper published by The Treasury in July last year, which concluded that the benefits of high migration over the past couple of decades for productivity and per capita growth had been modest. It may even have diverted resources from more productive activities and worsened the pressures in Auckland's housing market, where supply was not nearly responsive enough.

Fry argued that the 'least regrets' policy would be to tailor the migration policy to take into account the economy's inability to build enough houses and schools and roads quickly enough to cope without a blowout in house prices and interest rates.

"If this (housing and infrastructure flexibility) cannot be achieved, there may be merit in considering a reduced immigration target as a tool for easing macro-economic pressures," Fry wrote.

She argued that more work was needed to assess whether more migration actually obtained the assumed benefits to per-capita GDP, or whether a lower migration target could help reduce interest rates, lower the exchange rate and produce more balanced growth.

This isn't a new or outrageous idea. Australia's Productivity Commission held a formal Inquiry in 2006 into whether a surge in migration would boost per-capita incomes. It found such an increase was unlikely to help much.

Labour Leader Andrew Little was careful this week not to call for lower migration, but he agreed an Inquiry by New Zealand's own (and new) Productivity Commission over the economic impacts of high migration would be useful. Finance Minister Bill English said he wasn't contemplating launching such an Inquiry, but he did note the recent surge of short term and low skilled migrants might be having an impact on the low end of the job market.

More importantly, for Mr English, it may also be preventing some of the 148,000 unemployed beneficiaries from getting off the benefit and into some of those low-skilled jobs. It's also an expensive headache for the Government as it scrambles to quickly build new schools and other infrastructure in Auckland.

It's time New Zealand revisited the assumption that high migration is naturally good for the economy and the Government's budget. Not all migration boosts the economy and it's not all good. A proper Inquiry would test those assumptions and allow a better set of choices to be made that would lift per-capita incomes over the long run and make our housing and infrastructure more affordable. 

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A version of this article first appeared in the Herald on Sunday. It is here with permission.

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14
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Bill English is not even interested in finding out what is really going on with the effects of his Governments immigration policy. Falling GDP per capita, unaffordable housing, infrastructure shortages and marginal Kiwi workers getting squeezed out of work but she's all good in his eyes. It's becoming quite clear that the immigration policy is a failure, we're not getting needed skills at all according to the analysis by Michael Reddell http://croakingcassandra.com/
Who or what are this governments constituency?

It's pretty easy to blame immigration for aucklands housing prices, but of course if the council and government had actually allowed enough houses to be built we also wouldn't have had a problem. Having to build houses shouldn't be seen as a negative thing; it is of course a huge economic stimulator and employer.
I personally think Auckland is only just getting big enough to be a proper global city that can compete for skilled employees. If it was still say 1 million it would be too small. Of course traffic and density are all part of being a decent sized city - if people don't like it there are plenty of smaller cities in nz.

11
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Internal immigration in New Zealand is net out of Auckland Jimbo. More choose to leave than move there. That seems to be a vote. If you are finding Auckland too small for you you could try Melbourne, Tyoko, Mumbai.

A lot of people would have moved out of Auckland either to cash up and buy a cheaper house elsewhere or because they can't afford to buy their first house - but like I said you can't solely blame high house prices on immigration.

Likewise you could try Detroit or Kansas.

I personally pay much more than my fair share of tax in this country - as do a lot of people in my industry. If a lot of us went overseas in search of a proper city you might find the country would be left in a bit of a pickle.

25
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Why do pro-migrationers hate NZ so much that they have to change it?

Key hates NZ as it is. He hates our flag. Hates our built heritage (Chch Cathedral etc). Hates our native population (wants to fill us with non-natives ie those not born here).

There is nothing wrong with NZ being small. There is nothing wrong with NZ not being cosmopolitan.

NZ is NZ stop trying to change it.

Fact is that we are better off without migrants, they lower wages, drive up house prices and cause infrastructural mayhem.

I give Invercargill as an example of how NZ can be. It has had a stable or declining population for nearly 60 years, yet employment is high, cost of living low and people's lifestyles easy and comfortable. Imagine if NZ had 1 million fewer people? There would still be lots of us, but we could have not only the best country to live in but the best affordable lifestyle and quality of life.

Change is needed, starting with the end of the student visa scams.

I don't hate NZ at all - but that doesn't mean I don't think it could be better. I have travelled and lived in other countries and seen some of the really great things they have that we don't currently possess - I'm guessing you've never left Invercargill and assume that is the pinnacle?

...then go back there.

Why should I? I love living in NZ. I'm not the one bitching and moaning about NZ - that would be everyone else on this forum.

...no, just just seem transfixed with he idea we need more people...and if that what you want, move elsewhere I say.

12
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No, I have long left Invercargill, but it is still a wonderful city.

I have lived in Auckland (Ponsonby), Wellington (Kelburn), Dunedin (City Rise) and currently Christchurch. They are all fabulous places to live and we own property in all those cities (and several others) all except Wellington.

Jam packing these places with more people makes them worse, not better. If you want to be jammed in go and find that somewhere else.

Don't force me to be fenced in...

I actually agree with you JimboJones. New Zealand is already a pretty insular, staid, parochial place and I cannot imagine living here back in its supposed Golden Age. I malign the neoliberal revolution just as much as anyone, but some form of dramatic reform was necessary to snap the populace out of its smug self-satisfied complacency.

It truly would be in my view, a thoroughly dismal place if the whole country were like Invercargill.

The great thing they have overseas is what?

Overcrowded cities

If you prefer an overcrowded city there are plenty to choose from - don't make another

you may say they have "overcrowded cities", I may say they have more energy, culture, vibrancy, interest, dynamism...
yes Auckland's traffic is ugly, and property prices are stupid compared to 20 yrs ago. but....there's more choice, culture, vibrancy, etc etc. If people don't like Auckland, there's plenty of Invercargills for people to migrate to. So I don't know what the fuss is all about.

Well I left London for space and a life.....ie no more severe rat race. Its dead easy to jump on a plane and go to any city of your choice in the world.

Fair enough...so isn't it about choice? Akld becomes our big city, that's where you go if you want energy etc. There are plenty of smaller cities and towns to live in if you don't like a bigger, more vibrant Auckland.
So what's the problem everyone????

so, you assign higher priority to

energy, culture, vibrancy, interest, dynamism

over

Housing, education, transport, health, welfare

They aren't mutually exclusive

Trouble is cities super-scale (Ted talks) , ie the bigger they are the more there is to them.

Invercargill is also incredibly boring, small minded and repressive. Give me exciting, multi coloured, multi flavoured Auckland any day. Having said that, I've long thought immigration intake is too high. Somewhere in the middle please.

I have never lived in Invercargill, but stayed there a lot for business. The people there all very much enjoy their life and appear to involve themselves in active outdoor pursuits. After all they have some of the most beautiful countryside in the world close at hand. They seem very sociable and have a strong community that enjoys its fair share of amenities. The weather can be a bit rough, but then it can be lovely too. Much the same as Wellington. I always get alarm bells when somebody says that somewhere or something is boring. To me it says more about the person. You get out what you put in and it is a pretty shallow existence if you want to go through life with external parties taking responsibility for your enjoyment and entertainment. I suspect that you will be on the edge of boredom anywhere in the world with that attitude.
Further, that community of 50-60,000 that you find so boring, contributes in the order of 20% of the GDP. Further more it is a real wealth contribution like primary produce exports, aluminium and power, not the rather doubtful activities in Auckland like importing and distribution, financial and speculative manipulation and providing the housing and infrastructure for the Auckland population growth Ponzie economy. The good folks of Invercargill are bankrolling more than their fair share of the Auckland money hole.

Dead right - more often than not posts do say more about the person who is writing it, than what they are trying to convey

Worth repeating. Southland. 90,000 people actually. 20% of GDP. Work it out folks.

I think you've got the wrong figures there KH, according to StatsNZ, Invercargill contributes less GDP to the country than even Northland. Even with major State financed infrastructure like the Tiwai Point smelter and Lake Manapouri hydroelectric dam.

http://www.stats.govt.nz/browse_for_stats/economic_indicators/nationalac...

22
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Sorry but size isn't everything.
Filling Auckland up with imported petrol pump operators, $2 shop proprietors, taxi drivers, property speculators and sex workers is not a recipe for a truly successful city.

Correct, I wasn't advocating for that. We shouldn't have a problem attracting decent migrants though.

so, why aren't we attracting (to use your words) decent migrants

What is your recommendation on how to attract decent migrants?

what is your solution to the imported petrol pump operators, $2 shop proprietors, taxi drivers, property speculators, $2 per hour chefs, and sex workers problem

Abolish the minimum wage. Those "professions" that you have listed are attractive because they pay disproportionately highly relative to the amount of value added to society. By abolishing the minimum wage you'd get market forces determining how much petrol station operators are worth and in all likelihood a reduction in the number of people willing to migrate for that job.

Genius logic sadr001. Do you know what else will happen? Poorly paid Kiwis will have even more of an incentive to join the exodus to Australia, where pay is already far higher than in New Zealand. Who will clean your toilets, vacuum your plush office carpets, and wipe your butt in the retirement home once age renders you incapable to do it yourself?

It's supply and demand and what many people are forgetting here is that you need a product (any product) to sell to make a living....so Sadre is correct if you intervene in the free market in any way it becomes distorted and once it is distorted it affects other areas.

No one should ever be stuck in their thinking that higher wages are better or an improvement of some description.....it all all about the product or service that you sell !!!

If nobody wants to clean toilets then guess what the price for cleaning toilets goes up.....all the minimum wage does is stops the gold fever people who under the free market wage would change their product or skills to what the market wants.....and that in turn ensures the bureaucracy can maintain a false level of power over everyone it is the stuff of dictatorships Anarkist, and something I thought your namesake would understand!!

"It's supply and demand and what many people are forgetting here is that you need a product (any product) to sell to make a living....so Sadre is correct if you intervene in the free market in any way it becomes distorted and once it is distorted it affects other areas."

I hate to tell you this, but a free market has never and can never exist. Market based exchange has always been inextricably bound up with government and modern scholarship has found that authorities in the Medieval period took a keen interest in imposing their own particular brand of morality on market exchanges and regulated them with the objective of sanctioning what was in their view abberrant social behaviour.

"James Davis examines the interaction between moral perceptions, inspired mainly by the teachings of the Church, and market regulation and market practice in late medieval England. Davis focuses on the retailers and craftsmen that provided the main link between producers and consumers. Christian ideology did not hold these petty traders in high esteem: they were suspected of avarice and damage to the "common good." Market regulation was influenced by these suspicions: rules echo the desire to restrain such undesirable behaviour and protect consumers from its effects. But at the same time the vital contribution of petty traders to the sustenance of society was acknowledged and even accommodated. Legislators often took market considerations into account and, even more importantly, enforcement practice provided considerable room for flexibility."
http://scholarworks.iu.edu/journals/index.php/tmr/article/view/17668/23786

And then you have money; a token that is generally acceptable in a specific territory as simultaneously, a unit of account, a store of value, a means of exchange, and a standard of deferred payment. Money has always been a creation of a terrirory's or community's governing body, whether it be a tribal chieftain, a Medieval monarch, an ecclesiastical court, a Sumerian temple or a modern nation-state.

I really don't understand the degree of antipathy that capitalists feel towards the State when they are by far its greatest beneficiaries. What would all their wealth be worth if it wasn't protected by the police? How would squatters be excluded from lands owned by absentee landlords without the threat of State sanctioned violence? How would a stable, generally acceptable monetary system function without it being provided by the State? How would contracts between economic actors with little trust in the other be enforced without the State justice system? How would public infrastructure be built without State involvement, eminent domain, or compulsory purchase?

I just think its absurd to take away one of the few social mechanism which provide a modicum of protection for the economic welfare of some of the most vulnerable people in society, without addressing some of the more fundamental structures within our society which causes injustice and allows the dominion of one man of another in our society..

And your reply should tell you much about the people who work the system.....and just because there has always been intervention does not mean that intervention is the right and correct thing to do....you could go home and give your wife/partner etc a beating every night (intervene in her rights to be a free person)because that is what has been done throughout history ..... it is actually the people who refuse to change that ends up keeping others as slaves or in servitude!! Sorry to inform you but the right of an individual is Supreme!! It is the starting place of a decent fair society!!

Don't give me the capitalists are the greatest beneficiaries nonsense.....that is socialist propaganda spouted from the mouth of Nanny State.....by the way the last time I called the police for a burglary they didn't bother turning up....we found our stolen goods for sale on line....gave the cops the name of the person and a contact number and still the useless sods didn't show up......so not only am I forced to pay taxes and put up with incompetence I must pay for further security etc......Oh yes and on one of the occasions I rang the cops to update them I was told to hurry up because the female cop wanted to make it to the Briscoes sale.......when the cops can ping you 300 m from home for not wearing a a safety belt but can't turn up for a crime then the system is completely stuffed.

As for your last paragraph....how can you honestly say and with a straight face that the lives of the vulnerable have been improved by the social mechanisms in place???
IF these social mechanisms worked - then quite simply we would have a small Government, bureaucracy and public services as there wouldn't be large numbers of people needing assistance would there??? The only people getting anything out of this are those who are the highly paid (real beneficiaries) administering these services.........

NZ is farming poor people and poverty using structures that strip these people of their wealth and resources and that is where the injustice is......a bureaucracy and politicians having dominion over all private persons!! Politicians and bureaucrats are to scared to let the rope go and allow people the opportunity to take care of themselves.....and that is why NZ is so highly regulated....there is not one industry that you don't need some license for, or some annual inspection/s....or a plethora of paperwork to complete....we live in a screwed up environment - one where people think they need big government and bureaucracy to have morals.......but a fact is that if people cannot tell the difference between what is right and what is wrong they lack sympathy/empathy and not Nanny State.

If laws and regulation were what is necessary then quite simply we wouldn't need more rules and regulation!! If you don't want vulnerable people stop protecting policies, laws and regulation that make them vulnerable.

You wanted to reduce the number of people coming into NZ, presumably you believe that we are too crowded already? If so losing a few to Australia is a good thing. Australia can complain about the migration problem if they feel like kiwis are taking their jobs.
If too many kiwis move then demand will go up in areas that we have skill shortages in and wages in those areas will go up attracting people into the country. It is called supply and demand.

What do you think will happen when wages will go up? Employers will be given further incentive to import cheap labour into New Zealand. Perhaps houses and workers will be cheaper, but likely you'd have more difficulty understanding your neighbours or the cashiers at the local supermarket. Perhaps things will be cheap enough to overcome those petty inconveniences.

"For the countless Syrians, Afghans and Eritreans fleeing war and oppression in their home countries and seeking refuge in Europe, Germany is their chief destination, as it is for Kosovars and Albanians.

"If we can integrate them quickly into the jobs market, we'll be helping the refugees, but also helping ourselves as well," the head of the powerful BDI industry federation, Ulrich Grillo, said this week.

Europe's top economy expects to receive 800,000 asylum seekers this year — a record figure.

Beyond the humanitarian imperative to offer protection, businesses are increasingly seeing an economic case to keep the asylum seekers, particularly since Germany's rapidly ageing population and low birth rate are slowly depleting its pool of skilled labour. "
http://www.abc.net.au/news/2015-09-06/german-business-makes-case-to-welc...

Perhaps then you could complain about the amount of social security which the taxpayer will have to pay to allow underpaid workers a dignified standard of living. This has been the experience of the German public, which has led to Merkel and her Christian Democratic Party to capitulate to the demands of their coalition partner to introduce a minimum wage in Germany for the first time in its history.

"The total number of employed recipients of welfare, which underwent a massive reform in Germany 10 years ago, has stayed about the same over the past four years at 1.3 million. Roughly half of those people had a so-called "mini-job" -- one that pays so little it is exempt from social insurance contributions.

Outsourcing Salaries to the State?

Critics say the welfare trend is evidence that employers are partially outsourcing their labor costs to taxpayers. The Süddeutsche Zeitung said in a related editorial that many companies are capable of paying their employees more, but are instead holding down wages because of the availability of welfare -- and in some cases even counseling their workers on how to apply for state benefits."
http://www.spiegel.de/international/germany/report-cites-rise-in-low-wag...

"The wage will be set at 8.50 euros (£6.80) per hour, which is higher than the equivalent in the US and UK.

Angela Merkel's Christian Democrats approved the new policy as part of a power-sharing deal with the Social Democratic Party (SPD)."
http://www.bbc.co.uk/news/business-28140594

I am pretty sure that like Mac-pak most employers who want to will have already off-shored.

Macpac has retail outlets here though selling overpriced outdoor equipment. A friend of mine from South Africa who was here on a working holiday visa worked in one of the stores and had to take a second shift in a restaurant to make ends meet.

double post

"Decent standard of living" is what attracted people here. Market wage without consideration for standard of living will reduce the number of people who want to move here.

Tortured Logic - How low can you go

Not sure it's anything to do with hourly pay rates, and not sure imports come here specifically to undertake $2 per hour jobs - the abysmal pay-rates are a by-product of something else

From what I have seen and read, many imports, including overstayers (eg asian sex-workers), get themsaleves trapped and then blackmailed into accepting $2 per hour rates of pay in order to circumvent migration and visa requirements

Have you ever seen any of these ascendent employers who exploit and blackmail these people being charged with blackmail? - because that's what it is - a crime - and they get away with it

NZ Herald
Indian Restaurants $2 per hour
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=1150

I know that a local Japanese restaurant who pays below minimum wage to a Japanese girl, because she wants to live here with her Kiwi boyfriend who can't be bothered going through the partnership visa application. Its the only way she can stay here and her boss exploits the fact.

Boyfriend can't be bothered going through the partnership visa application... Probably not worth having as a boyfriend....

agree

Its not exactly a cheap or trivial exercise. I have a few friends in the process as we speak. Not a process for the faint hearted.

so, she is travelling under the radar, he is paying her in cash, off the books, no paye, no kiwi-saver-super, no holiday pay - nice

Just the tip of the iceberg. The horticulture industry is especially horrendous. You wouldn't believe the staff turnover, with the orchardists and contractors firing workers left, right, and centre until they get a worker capable of fulfilling their ridiculous piece rate based contract pay rates.

The problem is the roads and sewers etc needed....and the huge cost of those.

16
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Excellent question Bernard. Another good question is whether higher population is good . I think the place could be marvellous to live in with population of one million.

At one million the country would have no industry other than farming. There would be no city of any real scale. The economy would have been booming 2 years ago - but it would be interesting to know what it would be like now.
Youth would have no option but to work on a farm or orchard for little pay or move overseas.

Tourism, Software Industry, Wine Industry...NZ is not all about farming Jimbo

One million - depends on what's meant, Auckland alone or New Zealand as a whole

Whoops. Should have been clear. One million or less for New Zealand.

Yes and all of those require temporary migrant labour even with an official population of 4.5 million. I know this first hand as I've worked in two of the three and know people who work in the other.

Jimbo. Farming has carried the country for a hundred years now. Looks like it is going to have to for another hundred years yet. I would cheer if the IT champions or other technocrats managed to pull off a major new industry. But they have been trying for quite a while now, without any great result..

Hmm, so milk prices have halved to the point where almost all dairy farms are making a loss and yet we aren't in recession (yet) and the government's tax take has hardly dropped at all. Are you sure farming is carrying our country?

15
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Maybe Auckland should become a city state with big fences to the north and south and then see how well it does with a free migration policy while the balance of NZ become migrant free.

I know what the outcome would be. Within a few years the balance of NZ would be one of the richest countries on earth with the best quality of life, whilst Auckland would be a cess pit of indebtedness and inequality.

Or is that already the case?

Chris J, if you are a landlord with multiple properties you can't honestly say you haven't benefited substantlally from immigration in the last 20 years? Of course you have.
I don't want my children to lose out from a no growth Green agenda.
It's all very well for people to talk about a "new economy" but its bollocks. NZ's economy, like most, is propelled to a significant extent by population growth, for better or for worse.
I have two teenage children, and I don't want them to lose out whilst people like Chris_J have gained a lot from the policies they say they now despise.
It's very hypocritical!!!

Is it my fault that I bought investments which sky rocketed in value?

I would prefer prices to be lower so I could have bought more property with better returns.

My view is far from hypocritical. If we are relying on immigration for growth, then our country is screwed. Growth needs to help everyone up, not just a select few property owners.

Even 4 is OK IMHO, 8million? hmmmm. 20million? no.

How many cows and sheep do we have? More sustainable to base an economy on local human consumption than one based on dead animal based protein export.

20
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I would welcome a formal Inquiry into the short and long term effects of our loose immigration policy's. And stop the flood of migrants into the country immediately whilst it is being conducted.

15
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Stop the flood - it's a Tsunami

Don't know how much attention Bernard gets in the halls of the beehive
Do they listen to him or simply regard him as an irritation

because

The proposition of closing the doors while the mess is cleaned up is not new
It has been around here for 6 or 7 years - and Bernard has been aware of that

I often wonder if the wallah's in wellington ever read these pages

Seems odd that you would live in Puketepapa if you are so anti immigration! Puketepapa is the most ethnically diverse areas of NZ (and perhaps one of the most in the world). Why not move to the shore if you only want to see white faces?

How many times has racism been used to shut down debate about immigration (which is about a host countries right to choose who and how many)?

What right did the Maori have in deciding who and how many European settlers came? Absolutely none.

The race card
Jimbo must have sucked on a lemon this morning - he's on fire today

Who said anything about the colour of peoples faces

This is about logistics and all inbound migration - regardless of the colour of their face

As Bernard keeps pointing out, over 200,000 arrived in 2 years
Meanwhile Auckland cannot build enough houses to keep up, let alone mark time
Falling further and further into arrears
To the disadvantage of all

To be fair there are some reasonably racist comments on here, not necessarily by yourself.

Another question is about per capita GDP. A GDP might be rising but the life experience of inhabitants might be deteriorating because of that.

"hourly wage inflation mired at under 2%" (1.6%)...So inflation (read, interest rates) is being held low by migration and yet wages growth is running at 4 times the rate of inflation ? How can we get some more migration thanks ?

But apparently we would be better off being more like Japan with no growth! And they are lucky they had a pretty good base to start with, imagine if we had no growth since the 80's!

Japan is a great place for the inhabitants Jimbo. People like you struggle to explain what the problem you see with Japan. Your argument is "Japan is doing it tough because there is errr. 'No growth' and that is bad because there is. errrr. ummmh. 'there is no growth'
Population is stable too. What a great advantage it is to them.

And all those arguments about a diversity dividend didn't apply to Japan. They became a major trading nation without it.

Japan is about the size of NZ and has 80 odd million people. Tokyo itself has five times the number of people than our entire country. Yes it is a great place, I've been there a couple of times. But due to no growth their inhabitants have to work crazy hours with little to no holidays to keep up the spending habits that they got used to back when they had growth.

11
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I hate to break it to you but Japanese work less hours than New Zealanders according to latest OECD stats. The population in Japan is around 125 million not 80.

https://stats.oecd.org/Index.aspx?DataSetCode=ANHRS

I don't understand what your fixation with 'growth' is, what do you want to achieve with it? The appeal of NZ to many is that it has a lower population density than many of the other countries in the world. Contrary to your view there is are limited amounts of resources and land available, increasing the population just splits it between more heads. Less for all.

Also, what is the point of chasing arbitrary GDP growth? Are people today happier and better off than there fore-bearers were in the 60's and 70's? Half of the younger generation can't even afford to buy a home anymore, yet you want to bring more and more people into the country.

I don't believe for a second that they work less than us. When I was there it was rush hour on the train at 9PM with people returning home from work.

NZ will always have a low population density, and there will always be places to live in NZ with low density. If Auckland is too cramped for you try Wellington. If that's too cramped try Nelson. But there are obviously also going to be people like myself who would like a decent population density in at least one city - I find not having many people around boring.

They've also got a really nasty ticking time bomb...ageing population. With no population growth, that's going to come back to bite very soon.

A stable population will always have more old people that an expanding one Thomas. And what actually is the problem with that. Are you seriously believing that population can expand forever. There is a problem with that one you might have missed. Think it through.

I guess it's about what the objective is . Is it the betterment of New Zealanders or something else?

All this argument about immigration has been known for a long time but has been ignored and suppressed.
Radio NZ's coverage is atrocious as is TV3's (TV One let the cat out of the bag on Q and A). A sure way to get bumped off a left-wing blog is point out where Labour or the Greens are on this issue or a right-wing blog by suggesting that the property industry is leading the government by the nose .

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TV One let the cat out of the bag on Q and A

Are you referring to that Aussie economist who suggested the property sector was the GDP 'growth' alternative to the mining sector? And backed up that statement by pointing out "look at our house price growth"?

"There has been a broad political consensus until now that migration was an unalloyed good thing"
I am sure the French, the Germans and the Brits will agree with this statement.

Whilst on the subject of Q & A....there appears a need for more social workers at the Coal Face to actually make our Social Policies that are not 'Working' actually work. Is it a Solid Energy default or a bigger trend.

It appears on the surface that there is more management by de fault than is truly warranted. The faults appear to be multiplying.

It seems to me to be a similar pattern in most of the State Run enterprises.

Laying off staff, but acquiring more Social Workers to not make the grade.

Is this a fault of "too many cooks spoil the broth" or is this a Government policy, not working.

Is this a National strategy or a world wide one. Is it a birth defect or a lack of work ethic.

It appears to be common fault this policy of not working as planned.

Is this due to poor planning or poor Management.

Is this due to poor housing, not being addressed or poor education or poor lack of Management by poor choice of Leadership at the Beehive and elsewhere.

Because all I can see is poor management getting ahead of itself,but not achieving their goals, no matter what they claim, but benefiting by staying in charge.

It also appears to be a Fonterror trend. Our MP's have it sussed too.

When we need more Social Workers to counter problems, are we creating more problems by default to counter the trend of poorer conditions by design.

Does this count to GDP. Does this mean Government is actually working.

Is a poor Middle Class going to counter this trend as per America..

I am at a loss to understand the need for more Social inactivity, but poor social responsibility. Who actually is responsible. Are we still blaming recent imports, or the ones who imported the trend.

There seems to be a lot of talk and not enough action, so I thought I would write about it, instead. Unlike Q & A. I got the picture, straight away.

Maybe I can help. I could write a report. At an enormous fee. It beats going begging.

But what would I know. Not much. But I keep looking on, in horror.

Is this a clown report? We want to be competitive don't we? The western world in general will be running out of workers over the next few decades. We need MORE people in NZ. Perhaps it's not about the migrants but more about the colour of migrants that all the 'we was grown here' kiwis upset. Nah, can't be.

Good attempt to drag the arguement over to a racist, xenophobic lane.
Do you have evidence to contradict the studies mentioned that point to immigration being more positive than negative?

......ha..running out of workers? To do what? All the data points to less work for all....or have you not heard of technology job displacement? You are clearly a man of the times...but you need to put your clock forward about 50 yrs to catch up ... an hour wont do it!

It is the places that are building technology that will be prosperous in the future - San Francisco, Korea, Germany, and maybe even Auckland. The places that resist progress will fail the quickest.

Cue the clowns and their painted faces screaming racist at the very thought of a sustainable steady population, ignoring the fact that in the future we will require less people due to robotics.

Yes Bernard. Productivity Commission. I've had one round with them. Smart guys. Good culture.

Hahaha - first we are told by B&T that offshore Chinese investors represent a few percent of the market.
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=1151...
Now all of sudden the market has changed because offshore Chinese aren't buying and can't extract funds from China. Poor journalism, how about questioning the inconsistencies in B&T's story.

We need to remember that Australia's problems have changed our whole immigration equation. We still have an open labour border with oz. Typically, over 20-30 years our migrant outflows (net) to Australia have required a 'top up' from rest of the world to stop our workforce from shrinking . . A smart govt would recognise that, for now, there's no exodus across the Tasman. So there's absolutely no need for so many new migrants - especially at lower skilled end. Do we really want jobless returnees from oz going straight onto our dole queue, or trying to outbid Indian and Asian students for very low wages?

Excellent as always Bernard, one of the few voices in NZ who doesn't just regurgitate what the other sheep are saying.

It's a belief that People of NZ are more open minded in the world but they not. As a migrants I found them too scary, freaky and worried about their existence! I think If you got a talent then you can achieve jobs, house and everything. Migration brings more competition for everyone and for real progress we need it. America is full of migrants and look at it. It has become super power. We New Zealanders have to be more confident, more strong and more competent. No doubt, we do not want any mess( housing market). If someone is misusing our system then they must be kicked out.

No need for so many immigrants if you stop driving the best kiwis overseas.

I am a migrant from a developing country and I left my country for a variety of reasons , one of which was overcrowding in general and exploitation of labour , I would not want to see same thing happen to NZ and my next generation. I am not saying pull the ladder now as I have climbed the ladder rather to have a balanced approach. It is well known there are education outfits that are bringing in students with implied intent that they can work and work towards residency. The lower wages will turn Nz into the class division society.
Nz should only take migrants that are required in real economy and can be absorbed. Simply to follow what UK and others have done is not a logical reason to follow suit. I am not not anti migration at all but it has be needs driven and when I accepted to become a NZ citizen , I undertook to safeguard its interests .

Congratulations - you are one of the few "migrants" (among the many on here) that I've seen here who have had the honesty to declare the reason they came here - you are to be commended for that

Why do you think our ancestors settled in New Zealand? Do you think they came for the beautiful scenery and job opportunities?

Just to bring more complexity into this study, we need to understand different types of migration and their impact on NZ economy, i.e. do richer and investor type migration contributing more than average New Zealander? should we continue to open our education market to Asian students? recall from news education is the 3rd biggest industry in NZ?
also need to taking into account the world market has changed, i.e. would NZ be able to produce the same GDP without migration in today's economy.