Fear of exodus of NZ workers to Australia after citizenship change

Saturday, 22 April 2023

Citizenship move will have an impact on workforce choices, economists predict.

Australia’s decision to make it easier for Kiwis to become citizens could open the floodgates to more New Zealand workers leaving the country, worsening skills shortages here, experts say.

Auckland Chamber of Commerce chief executive Simon Bridges said the Australian government move was a good outcome, as it gave Kiwis in Australia “the rights they’ve long deserved”.

But “it clearly does have the potential to feed into our long-term ‘brain drain’,” he said.

Bridges suggested that should not become a political football, saying it was an issue “all political parties in election year need to have strong policies around”.

PM Chris Hipkins speaks about his plan while visiting Australia this weekend.

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“We need to see ideas from parties, business and wider civil society on how we ensure a more productive, higher wage economy that’s sufficiently attractive for New Zealanders to stay in and come back to,” Bridges said.

The Australian rule change means New Zealanders living in Australia will soon have access to Australian citizenship and its benefits after four years in the country.

Prime Minister Chris Hipkins said he did not think the easier pathway to citizenship would make a “significant change to the calculation” for New Zealanders thinking about moving to Australia.

But economist Cameron Bagrie expected the development would be a big factor in people’s decisions about where to work and live, especially given the expectation that New Zealand was entering a recession.

“It's pretty well flagged that New Zealand is going to have a full-blown recession and the consensus is Australia is going to avert one.

“That in itself is going to drive migration flows towards Australia.”

Bagrie said New Zealand had generally done well over the decades when it came to migration, but was now entering a global environment where there was heightened competition for staff driven by “structural trends such as demographics”.

Healthcare workers would be among those who might be more tempted to leave the country, he believed.

Auckland Chamber of Commerce chief executive Simon Bridges says all political parties need to have a plan.

Broader factors could come into play, he suggested.

“I've never seen New Zealand so divided, and it’s starting to get a bit of a nasty underbelly.

“People now are pretty mobile. Anecdotally there seems to be an awful lot of ‘Friday nights’ going on because someone is leaving overseas.”

Bagrie noted Stats NZ statistics were showing a strong net inward migration flow overall, but said they were estimates only “and it doesn't stack up with what we're seeing and hearing on the ground”.

“We don't know what the true numbers will be a year down the track because whether people leave as a traveller or a migrant, we don't know until they don't come back in 12 months.”

Stats NZ’s figures can catch people who are simply arriving in New Zealand on working holidays.

Massey University sociology professor Paul Spoonley agreed the Australian citizenship change would result in more emigration.

“This gives people a degree of comfort if they want to go and live and work in Australia as New Zealanders, and will encourage people to stay on, rather than at some point come back to New Zealand.”

There could be a particular incentive for people who were close to qualifying for Australian citizenship to delay any planned return, he said.

But what was not clear was “how many” people would be influenced by it, he said.

A net 17,000 New Zealand citizens left the country in the year to February, with the bulk of them going to Australia, despite an overall estimated inflow of 52,000 migrants overall, he said.

Spoonley said that in 2012, 53,800 people left New Zealand to live in Australia, and did not rule out another exodus.

But one of the unknowns was whether the relatively large number of citizens who had already left the country recently was a temporary phenomenon driven by a pent-up desire for travel after Covid, or something that might prove more long-lasting, he said.

“The question for me is, is that just a little blip or will it climb and will we see something approaching the ‘great outflow’ of 2011- 2012? We just don’t know.”

Here's what you need to know

Rights come into effect on July 1, 2023.
Applies to Kiwis on temporary, special category, visas who have lived in Australia for four years, and meet the standard Australian citizenship criteria (e.g. pass a character check, adequate knowledge of Australia, a basic English competency, will continue to reside in or have a connection with Australia) and attend a citizenship ceremony.
Is retrospective. Those in Australia since 2001 will be able to apply directly for citizenship without gaining permanent residence first.
Is affordable (the fee is A$490).
Has no minimum income requirement or health requirement.
Gives Kiwis access to services and benefits, once they become citizens.
Allows Kiwi children born in Australia to become citizens at birth (rather than waiting till they turn 10, as they do now).