NZ Inc churning and burning faster than ever

There is now record-high outward migration of our best-trained young people, alongside even higher inward migration of workers on temporary visas who live under a cloud of uncertainty and in constant fear of exploitation. Photo: Lynn Grieveson / The Kākā

TL;DR: A record-high net 44,730 New Zealand citizens left the country permanently in the year to the end of September, Stats NZ reports. They were more than replaced by an also-record-high net 163,570 non-citizens arriving permamently, but mostly on temporary work visas.

Our ‘Churn and Burn’ economy of a housing market-with-bits-tacked-on that is fueled by record-high migration, low investment and rising residential land prices is churning and burning faster than ever. The escape valve of young New Zealanders with skills and connections jumping on a plane to Australia is working better than ever, but it’s creating new negative feedback loops of more staffing stress in health, education, construction and transport. These in turn squeeze the economy’s ability to raise productivity and real wages and increase desperation for yet more temporary migration, let alone address the core of the problem: insufficient and brutally expensive housing for renters and buyers.

The ultimate exit valve in this pressure cooker is the poorest renters under the most stress falling into homelessness and food poverty. Our nation’s ‘Churn and Burn’ dashboard is now full of blinking red lights, including:

• record-high outward migration of our best-trained young people to Australia and elsewhere at a rate of 200 a day;

• record-high inward migration of 585 mostly young workers on temporary visas who live under a cloud of uncertainty and in constant fear of exploitation and deportation without equal or free access to our welfare or health systems;

• Auckland house prices bouncing strongly again at double-digit annualised growth rates, given its population is growing at a rate three times faster than new homes consented, some of which just replace existing homes, rather than adding to the total stock;

• use of food banks having risen 165% to 480,000 per month since early 2020, the NZ Food Network found in a survey this year as the most stressed renters in the world can’t afford food; and,

• the number of households formally registered as homeless rising 9% to 25,284 in the nine months to the end of September, including almost 500 who said they were living in their cars, five times higher than five years ago.

Elsewhere in the news today:

• Christopher Luxon, David Seymour and Winston Peters finally met in person to talk about forming a Government, a month and a day after National won the election;

• Auckland Council meets today to push forward with $5 congestion charging, but the backlash has already begun, and Tauranga’s ratepayers are also already up in arms about the prospects of a similar scheme being imposed there by commissioners; and,

• Without a ministry in place for direction, Government departments are pausing their hiring plans in moves likely to increase economic uncertainty and further slow activity, especially in Wellington.

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Exit valves for ‘Churn and Burn’ economy opens wider