New Zealand’s unemployment rate rose to 5.1% in Q4 2024, up from 4.8% in Q3 2024.
In comparison, Australia’s unemployment rate was 3.9% in Q4 2024 (4.1% in March), the widest gap since Q3 2012.
The latest SEEK employment also shows that the number of job ads in New Zealand has fallen heavily from the peak, whereas the number of applications per job ad is tracking at a record high.
The Guardian reported that the weak New Zealand labour market and the relative attractiveness of Australia have seen large numbers of Kiwis move across the pond, “hollowing out” cities and towns across New Zealand:
The Baker family are among a surge of departures from New Zealand, mostly fleeing a weak economy, in an exodus that is fuelling concern for the country’s future and has small towns scrambling for survival. Demographers are particularly worried as all ages of New Zealanders – not just young people – are packing their bags.
“I don’t know why we’re not talking about this more. We have a steep decline in fertility, a rapidly ageing population, and, out of Covid, we are seeing the rise and rise of departures,” says Massey University’s emeritus professor Paul Spoonley, a leading sociologist.
“Parts of New Zealand are beginning to empty out, they will suffer stagnation or are in decline. The question for me is – will the number of New Zealanders leaving the country begin to come back?” Spoonley says…
Last year saw the biggest net loss of New Zealanders than any calendar year on record. About 56% of New Zealand emigrants – those planning to live overseas for a year or more – head to Australia, where the average pay rate is 26% higher…
“This is a hollowing out of this demographic of mid-career workers, who in reality do the bulk of the work,” said Simplicity chief economist Shamubeel Eaqub. “That’s the jaws of death closing, and then we have labour market problems”.
The following chart from Statistics New Zealand illustrates the situation, with just under 90,000 net New Zealand citizens leaving the country in the two years to February 2025.
Around 30,000 net migrants were lost to Australia last year, according to Statistics New Zealand.
However, overall net migrant arrivals remained positive at 30,900 in the year to February 2025, courtesy of strong arrivals from Asia.
Unlike Australia, housing in New Zealand is at least becoming far more affordable thanks to heavy price falls and falling mortgage rates.
Real house prices in New Zealand have fallen back to pre-pandemic levels.
Justin Fabo from Antipodean Macro estimates that mortgage repayments as a percentage of household income have fallen from around 50% to just over 35%.
Hopefully, the improving relative affordability of New Zealand housing will encourage prime young Kiwis to stay home, reducing the brain drain to Australia.
