Brian Fallow looks at what exactly is the issue with immigration that's making it an election year issue, and finds three areas of concern

By Brian Fallow*

It is clear immigration is an issue this election year. But it is less clear what exactly the issue is. 

The debate, if you can call it that, is bedevilled by the fact that people have different ideas about what the problem is, which statistics are troubling and what the policy response should be.

Broadly we can distinguish three areas of concern. 

The first we might call the overload problem. Current net immigration flows mean that the number of people living in New Zealand is growing faster than we can cope with, particularly in the areas of housing and infrastructure, but also some public services. 

Polling by UMR Research last month asked people how prepared they thought New Zealand is to accommodate population growth (both immigrants and citizens) over the next few years. On housing 68% said not prepared, on transport 53% and on the health system 52%. 

The second area of concern relates to the labour market. On the one hand, despite high rates of immigration and issuance of temporary visas, business sentiment surveys are recording mounting concerns about skill shortages. 

But that is combined with a belief that immigrants are crowding New Zealanders out of some lower-skilled jobs and suppressing wage growth. Even amongst those in the UMR survey who are positive overall about immigration, 30% agreed it lowered wages and working conditions. 

The third issue might be called nativist angst. It relates to the granting of residence visas, the right to remain permanently in New Zealand and access health, welfare and other benefits. This is boosting the permanent population by about 1% a year, which is more than the contribution of natural increase (births minus deaths) and will over time change the ethnic composition of the country in ways some people have a problem with. 

Among respondents to the UMR survey who were overall negative about immigration, 75% agreed that “It feels like New Zealand isn’t our country any more.” 

On the overload issue, the Government’s line goes like this: We are working on the supply side constraints but a lot of them are local government’s fault and it all takes time. Meanwhile businesses are crying out for skilled labour and, anyway, the big change in recent years has been that far fewer Kiwis are leaving for greener pastures overseas and more expatriates are returning, especially from Australia. And that’s a good thing. 

In this context the relevant measure of migration is Statistics New Zealand’s permanent and long-term (PLT) migration data, based on what people declare on their airport arrival and departure forms. Regardless of nationality you count as immigrating if you intend to be in New Zealand for more than a year, having been out of it for the past year, and conversely for emigration. 

Over the past three years we have seen a net gain of 196,800 PLT migrants (averaging 66,600 a year) compared with just 35,100 (or 11,700 a year) in the previous three years. 

Within that the bigger change – though there is not much in it -- is in the net inflow of non-New Zealand citizens.

Over the last three years there was a net loss of 11,300 New Zealanders, down from 88,000 in the three years to April 2014, driven by fewer leaving for Australia and more returning. 

And over the last three years there was a net PLT inflow of 208,000 non-New Zealand citizens, up from 123,000 in the previous three years. 

So a net increase of 85,000 non-New Zealand citizens on top of a drop of 76,700 in the net loss of New Zealanders.

Only the former is amenable to changes in immigration policy. 

When it comes to the labour market the more relevant statistics relate to issuance of temporary visas which allow the recipient to work. 

It has surged in recent years. In 2015/16 123,000 first-time visas with work rights were granted, or 209,000 when family members are included. 

“Overall the number of temporary migrants has increased almost 50% in the last 10 years,’’ a Cabinet paper delivered in March ahead of some adjustments to the policy settings says. Most of the increase has occurred since 2013. 

“We have seen particularly sharp increases in international students (many of whom can work, but generally only for up to 20 hours a week during term time), working holiday makers and essential skills visa holders….On a per capita basis our temporary migrant inflows are the highest in the OECD.”

The same paper, citing last year’s New Zealand Income Survey, says that across all skill levels recent migrants earned less per hour than their New Zealand-born counterparts – ranging from 6.7% less for those classified as highly skilled to 13.1% less for the lower-skilled. 

These are the sorts of data which on the face of it supports the argument of the Labour Party, and the Opportunities Party, that immigration at current levels is preventing the labour market from working properly and keeping wage growth weak at a stage in the cycle when business is good. 

In the year ended March 2017 the corporate tax take rose nearly $1 billion or 10%. In the same period average weekly earnings of wage- and salary-earners rose 2.2%, or not all in real terms. If this is trickle-down, it is a rather meagre and exiguous trickle. 

If you wanted to cut back on issuance of temporary visas, which look the most compressible? 

Typically more than half (55% in the 2015/16 year for example) are in two largest categories, students and working holiday makers. The latter are often covered by reciprocal international agreements from which New Zealanders on their OE also benefit. 

That leaves international students. 

The Ministry of Business, Innovation and Employment’s most recent Migration Trends report records a growing proportion of international students who five years from getting their first student visa have achieved permanent residence status. By 2015/16 it was 19% for all international students and 37% for Indian students. 

The higher proportion of Indians might reflect that they tend to be older; 77% are in their 20s compared with 51% for all students. 

They are also more likely to study in private training establishments rather than universities, polytechnics or high schools – 61% against 38% for all students. 

These are the sorts of numbers which underpin concerns that what is being sold here is not so much education as a pathway to residence. 

Labour’s recently announced immigration policy expects to achieve around three-quarters of the reduction of 20,000 to 30,000 in net immigration it is aiming for by limiting the number of visas issued to students on “low value” courses, and their ability to work during while studying. These are defined as those below a bachelor’s degree which are not independently assessed by the Tertiary Education Commission and New Zealand Qualifications Authority to be of high quality. 

It will also limit post-study work visas available to those graduating from a course of study in New Zealand to those who have studied at bachelor’s degree level or higher. 

Labour’s policy also includes a new “KiwiBuild” visa to help address skill shortages in the construction sector. It envisages 1000 to 1500 of these at a given time – additional to construction work visas issued under the existing rules -- provided the employers concerned take on an apprentice for each overseas worker they hire, the cost of whom would be subsidised to the tune of the unemployment benefit under its “dole for apprenticeships” scheme. 

On the nativist angst front, the UMR poll found 51% of respondents thought last year’s issuance of 50,000 permanent residence visas was too high, while 39% thought it was about right. 

Unsurprisingly it found New Zealand First votes most likely, and Greens supporters least likely, to agree that “to be truly a New Zealander you have to be born in New Zealand”. 

UMR also asked people, if they were forced to choose between these two options, would they prefer issuing fewer work visas but with more rights to remain in New Zealand and more access to social security or allowing more work visas to be issued but with more limited rights to remain in New Zealand and more limited access to social security. 

The result was a 60:40 split in favour of the latter. New Zealand First and National voters favoured it most strongly, by 73 and 72% respectively, followed by Labour voters at 55%. Only Greens favoured the fewer visas/more rights option (by 63%).

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

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46 Comments

There is a Second Order Effect that might become apparent soon. That being the number of, say, German immigrants who move to NZ as a result of their society being disrupted at home by immigrants heading into Germany from outside the EU. GIven that many of the new arrivals are single men, that is going to have profound consequences for host societies as time goes by. ( Similar to that facing China with it's previous one-child policy that generated more single men than women)

What exactly is the evidence for your statement that "many of the new arrivals are single men"; and even if that's true, isn't the same also true of the New Zealanders who leave?

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Anything in extreme is bad.

Blame government for not addressing the issue and let it become a burning issue as that is the only way to prosperity as per current national government.

Common sense - more the population more support needed for infrastructure, housing, health and government failed miserably.

It is no open secret that students who are coming to NZ, is not to study but is a pathway to residency. Even the private institution when they promote their institute they highlight - how they will get work visa and than residency instead of education - what they will learn.

No one can deny that fact except those who are benefiting by this ponzi.

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The skill shortage occurs in some industries because companies don't invest in promoting and training their lower level staff. Instead they choose to hire from outside the country.

Take restaurant managers for example. High on the list of immigration numbers. You could easily train one of your front of house staff to fill such a role. But then you'd actually have to pay them a proper wage vs importing cheap labor and screwing them.

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Giving student visa holders the right to work is a hidden subsidy. Educational providers are not competing on providing a good product -quality education. They are gaming and profiting on being able to offer an easy path to working in NZ (and therefore potentially getting a permanent residency). This is an obvious rort and should be closed down.

Legitimate education providers who only compete on the quality of their education have nothing to fear from this policy change. The ones who are complaining are just revealing that they are low quality educational providers...... NZ should not subsidise their business....

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Yes, it is a direct subsidy that discriminates against local employers who strive to employ locals

it is a facilitator of institutionalised blackmail (is it criminal? - I say yes)

You can bet that was not the intention but simply another example of how the spivs sabotage government policy

International students in the Canada, France, Germany, UK, Australia are all allowed to have jobs. It is normal that adults are allowed to work when they are in a country.

What is lacking in NZ and/or all the democracy countries is a political power that truly thinks independently, plans strategically and thoroughly, and execute consistently for the long-term and collective national interests of their people.

Yes, I yearn for the days of a New Zealand dictatorship where you "disappear" for not towing the ruling party line.

This is why we need a One World Government, and to do away with racist borders.

Lets become a State of Australia.

.. we can't ... they're in a state of denial ... their rugby team is just awful ...

Let's become a state of Venezuela .. ... they have more oil than Australia does ... oodles more ....

Yep. We need economic policy in the interests of New Zeslanders. Much of it isnt and ou have to wonder why.

No need to wonder. Ask everyone to vote specially young voters.

Politicians are meant to uphold the constitutional rights/arrangements of a country for the people and the free market (no interference at all) is meant to deliver what is good.......around the world governments manipulate, legislate, interfere and so we all end up trying to navigate as best we can with the cards we hold......

It is preposterous that in NZ we have a referendum for a flag debate yet our Bill of Rights 1688 and our Constitutional Act (just to mention 2) are changed without any referendums being held.

It is individuals who are creative that identify market gaps, develop new products/innovations etc that will consistently benefit the long-term benefits of the populace.....

As an employer I appreciate the benefits of a more diverse workplace, and being able to pay foreign workers far more than they would get in their country of origin. Mostly I enjoying giving them the opportunity to enjoy all the benefits of a first world country that they wouldn't otherwise have.

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Also great being able to pay locals less than they otherwise might demand.

Or perhaps locals are being paid too much.......so it is more about a rebalancing occurring on the labour cost front.........

We have too many NZ'ers working in unproductive areas and not enough willing to obtain the skills to work in productive enterprise.........NZ'ers want all the bells and whistles of a top class socialist system but don't want to have to pull the cart that pays the bills of that system.....hence the importation of immigrants to do the often productive but lower paid work that far too many kiwis turn their noses up at......

Too much in relation to what? Living costs? Housing costs?

Agree we have an entitlement problem. We pay an unnecessary pension to millionaires because they feel entitled to being kept in the lifestyle to which they've become accustomed, and we tax everyday working Kiwis to do this. We subsidise property investors and businesses via the accommodation supplement and Working for Families, all off the back of everyday working Kiwis. We subsidise dairy farmers' irrigation schemes. And we import labour from the third world because even a poor wage in NZ beats living in a slum in the third world. We put more of the load of infrastructure on workers rather than on the land owners who benefit from those services that make their land so valuable.

NZers who grew up with the bells and whistles of socialism seem to want to be exempt from the wages and taxes that were required, instead preferring to opt out of handing on similar services so they can skim more off the top.

Agree we have too many in unproductive areas - we're giving a cushy ride to unproductive property investment rather than encouraging productive industry instead.

Wages are tied to production and NZ is far from being productive......and if you look at the gap between what an immigrant worker gets paid to a local then you might realise that NZ is having a bit of a natural market levelling being implemented.......the fact is that if immigrants can live while being paid less then locals will be required to follow suit.......the only people who are ever safe is those who work in a bureaucracy/public services........now there is subsidised living for you.......and what are they doing with their money......investing in houses?!

Socialism is a corrupt vessel......there are always the oppressed and oppressors! If I were to send an account to every politician sitting in parliament for my direct loss of rights and the income derived from the direct loss of those rights, my account will very likely bankrupt many politicians. If the rest of the private working populace followed suit then I can guarantee their bankruptcy......would I feel sorry for them....absolutely not.......they all lack discipline seconds after taking their oath of admittance to parliament! The problem is far too many people think a politicians role is to intervene....even the media whine....what is the giverment doing.

You need to differentiate between the everyday kiwi worker who works in private enterprise and those in public entities......the first is getting shafted by the latter......and the latter have not had a day of financial reckoning.

You are just a walking contradiction, aren't you..

As an employer I wonder why foreign workers have to come to this relatively young country to get a decent wage... Their countries are centuries older than ours, what are they doing wrong? are they not diverse enough?

Their countries have suffered centuries or longer from European oppression. Wealthy white males immigrated here and created a first world country out of nothing, by using oppression and their privilege.

Ah, yes. The evil white European males. Curse them and their democratic system of government, formal education, motor cars, advances in medicine, judicial system, superior military, higher standard of living and manufacturing technology. Africa, New Zealand, Australia and the USA was sooooo much better before the white male arrived. Running around wearing grass skirts and chucking sharpened sticks at animals was soooo much better than those evil men and their civilised societies.

You should go here and check your privilege
https://www.buzzfeed.com/regajha/how-privileged-are-you?

I / We am enormously privileged. I like it but clearly that means nobody wants to come to New Zealand. ... ... uumh.... wait a mo.

Someone has checked into. Cursed child bearing stuffing everthing up. "18-year-old women are 35 percent more likely to attend university than 18-year-old men; and where 37 percent of black school-leavers go to university, only 28 percent of white school-leavers do. These stats were unveiled by UCAS in December, leading its chief executive to wonder if it isn’t time to initiate ‘outreach’ projects designed to get more white blokes into college."

"What’s more, young women now earn more than young men: £1,111 a year more, to be precise. Between the ages of 22 and 29, women in general — covering all races — out-earn guys; by the time women hit their thirties, however, their pay falls below men’s. Those young, opinionated new media feminists who get handsome advances to write books spluttering about ‘white male privilege’ are far more privileged than many of the white males they splutter about — especially the ones who empty their bins or sweep their roads. It’s almost Orwellian in its topsy-turviness — the most well-connected, middle-class women denouncing the alleged privileges of some of the most derided people in society.

Partly this is just bad science: feminists, leftists and others see that parliament and the boardroom still have a hefty number of white men in them and they extrapolate from this to argue that all white men must have lovely lives. Hence they always use the ridiculously sweeping terms ‘white men’ or ‘male privilege’, as if whiteness and maleness were inherently beneficial. As if loads of white men aren’t dirt poor and awfully underprivileged. It’s like seeing the Queen and thinking: ‘Wow, white women in Britain have it good, don’t they?’"

https://blogs.spectator.co.uk/2016/01/i-hate-to-break-it-to-feminists-bu...

Jordan Peterson - The idea of White Privilege is dangerous
https://www.youtube.com/watch?v=aZK9h_Mzmu8

Most first world countries have also suffered oppression at different times, including devastating wars and invasions. You can't blame everything on that.

They broke in the land for farming, thereby increasing it's carrying capacity. They turned the nodding tussock into an export industry.

Bold young men drove sheep on to the vast grazing runs to found pastoral empires and land owning dynasties. Out of the wealth from the squatters’ wool clips, and from wheat when the tussock was plowed, grew a city of scholarship, grace and dignity”

Professor Kenneth Cumberland Landmarks

If NZ has to have massive immigration to keep the economy going rather than increase production of goods, then the NZ economy is in serious trouble.
In the next few years we will notice a big downturn when this policy turns to custard.

http://sectorsdashboard.mbie.govt.nz/

Choose 'Comparisons across sectors' and select 'Real GDP'

The largest sectors in NZ are:
Professional services; Rental hiring & property services, Health, Finance and insurance, construction, wholesale, and retail trade etc

I am afraid that the prosperity of NZ's economy is closely linked to those sectors and the prosperity of those sectors is closely linked to increase in population.

Sad, isn't it?

It is sad and worse still is that most people fail to see what's happening........NZ needs to drain the swamp!

The rest of the world is screwed by overpopulation and hardship. I guess they are doing it for good reason so dear old New Zild should do the same because if it's overseas it must be good. (sarcasm alert)

Brian does a good summation. But he does miss the view of those who think long term. " Immigration " As a word and topic has become something with a maximum horizon of about a year.

Phil Lowe (RBA Governor) has lost the plot...or maybe, he never understood it in the first place?

workers shouldn't fear "robots or foreigners," or job security, and they should demand a greater share of the economy's profits through wage gains.

http://www.afr.com/news/economy/workers-must-demand-greater-share-of-pie...

Good one Phil! Now. Go and tell some an SME or two that they should give bigger wage packets to their workers because the notional value of their assets has gone up. And go and tell the workers at those SME's that they have nothing to fear if they subsequently get displaced, and that the massive debt load they have to service will be taken care of by some mythical job that will be waiting for them if they lose the job they have.
What planet do these people live on? Because it ain't planet Earth in 2017......

At the end of the day either house prices have to come down or wages have to go up. At the moment the government is working around the issue by importing workers from the third world...but that could change any time.

Starts with "It is clear immigration is an issue this election year.". Went to Labour's election meeting in Birkenhead a week ago with Jacinda and Andrew both making speeches. Not one mention of immigration. And Birkenhead must be one of the most ethnically diverse and successfully integrated areas in Auckland. Not sure if Andrew Little is scared off by criticism from ACT and United Future - a pity since his party has made some good suggestions. And surely even the strongest lover of immigration must support his proposed beefing up the Labour inspectorate to help get rid of the rorts.

Even Prof Paul Spoonley our countries acknowledged expert on immigration thinks the numbers need to come down - and his job depends on immigration. Certainly worth a rational debate.

I would trust either NZ First or Tops on immigration but never, never Labour. Labour is full of globalists.
Both labour and national are products of the media.

Nothing wrong with immigration but everything with government who has not implimented correct policy and is using immigration as a tool of prosperity (of few like them).

Humans aren't designed to do crap jobs:
Benjamin Franklin

The proneness of human Nature to a life of ease, of freedom from care and labour appears strongly in the little success that has hitherto attended every attempt to civilize our American Indians, in their present way of living, almost all their Wants are supplied by the spontaneous Productions of Nature, with the addition of very little labour, if hunting and fishing may indeed be called labour when Game is so plenty, they visit us frequently, and see the advantages that Arts, Sciences, and compact Society procure us, they are not deficient in natural understanding and yet they have never shewn any Inclination to change their manner of life for ours, or to learn any of our Arts; When an Indian Child has been brought up among us, taught our language and habituated to our Customs, yet if he goes to see his relations and make one Indian Ramble with them, there is no perswading him ever to return, and that this is not natural to them merely as Indians, but as men, is plain from this, that when white persons of either sex have been taken prisoners young by the Indians, and lived a while among them, tho’ ransomed by their Friends, and treated with all imaginable tenderness to prevail with them to stay among the English, yet in a Short time they become disgusted with our manner of life, and the care and pains that are necessary to support it, and take the first good Opportunity of escaping again into the Woods, from whence there is no reclaiming them. One instance I remember to have heard, where the person was brought home to possess a good Estate; but finding some care necessary to keep it together, he relinquished it to a younger Brother, reserving to himself nothing but a gun and a match-Coat, with which he took his way again to the Wilderness.

http://teachingamericanhistory.org/library/document/letter-to-peter-coll...

It's not so much crap jobs but that it appears that American Indians didn't want to reduce their quality of life and lifestyle. The end of that paragraph has parallels with Fight Club. "The things you own end up owning you. It's only after we've lost everything that we're free to do anything."

By crap job, I mean social environment and physical environment (a concrete warehouse with things stacked on palets) and all the restrictions of a timed environment (in at 8:00 - out at 17:00). If you look at the elements of job satisfaction the higher up the scale the closer they mirror the Indian life?

There is a contradiction in the UMR Survey

On a scale of 0 to 10, where 10 means you think immigration into New Zealand is an entirely
positive thing, and 0 means you think immigration into New Zealand is an entirely negative
thing, how would you describe your views towards immigration?

Total positive 31% Negative 23% (the rest unsure)

Are current immigration settings fair?

Fair on New Zealand citizens:
22% say Fair 36% Unfair (the rest unsure)
http://www.umr.co.nz/sites/umr/files/final_full_nz_insight_slides.pdf
Who ordered the report?

Ward and Masgoret (2008) found strong endorsement of multiculturalism with 89percent of respondents agreeing that a society made up of people from different races, religions, and cultures is a good thing.

.In addition, the research found support for government policy on the numbers (53 percent) and the sources (61 percent) of immigrants.
Analysis of the AIIM Survey data has also shown that attitudes towards
immigrants are influenced by personal background characteristics. More positive
attitudes towards immigrants were found in those who are overseas-born and
multilingual.
http://www.mbie.govt.nz/publications-research/research/migrants---settle...

Nigel Latta: "Nine out of ten New Zealanders tell us they want a multicultural society"

Eerily similar to how nine out of ten Austrians supported the Anschluss. (I know the above comment is old now)
Could it be that nine out of ten people are susceptible to hype? Just a thought...