NZ hits 5M population target 30 years early

The New Zealand Herald business columnist, Liam Dann, lamented that the nation’s population is about to hit 5 million people 30-years earlier than projected in 2004:

I have become obsessed with a Statistics New Zealand press release from 2004.

It forecasts New Zealand’s population to hit 5.05 million people by 2050…

Now I can’t get past the notion that this miscalculation holds the key to many of our social infrastructure problems in 2019.

If that was the population assumption policy makers were using, then of course we have a housing shortage … of course our roads, our hospitals and our schools are crowded.

The reason for the massive population overshoot is net overseas migration (NOM), as shown below by Mike Reddell:

Over the full period, the population has risen by (an estimated) 842000. Take natural increase (births less deaths) and the large net outflow of New Zealand citizens (another 315000) and you’d have been left with a pretty small rise in the population (less than 4 per cent in total, over 15 years).

That is simply an illustrative scenario. In the absence of large non-citizen immigration, the rate of natural increase would have been lower (immigrants, once here, have children too).

The annual breakdown is shown below, via Interest.co.nz:

Clearly, the primary driver of New Zealand’s population pressures has been caused by the government’s mass immigration policy. And if NOM remains at the average level experienced over the past 18 years – 27,800 – then New Zealand’s population will grow to around 7 million people by 2068, according to Statistics New Zealand:

The population would reach 7.5 million by 2068 with net migration of 30,000 a year. The populations ageing would also slow, but much less than the very-high fertility scenario. The median age would increase to 44.7 years in 2068 with very-high net migration – only slightly lower than the median projection (46.0 years). This reflects that migrants also age…

An interesting projection for comparative purposes is to assume no arrivals and no departures. This shows how the population is affected by births and deaths. With no migration, the population would peak at 5.3 million in the early-2050s then slowly decline as deaths outnumber births. Despite deaths outnumbering births, the population of 5.2 million in 2068 would still be 520,000 more than in 2016.

Much like in Australia, big business has done very well from hiring migrants who will work for the minimum wage or less instead of New Zealanders. Others have made millions from the relentless escalation of property prices. Meanwhile, New Zealand’s infrastructure and services are failing, its cities are increasingly congested and the environment is degraded.

Privatising the profits and socializing the costs – that’s now the ANZAC way.

Leith van Onselen

Leith van Onselen is Chief Economist at the MB Fund and MB Super. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.

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