‘Brain drain’ to Australia increases 42% in three months

Sabrina Rey and her partner bought their Henderson home in 2021, near the peak of the market.

The high price they paid, combined with rising interest rates, have prompted them to rent their home out and move to Australia, so they can use the higher wages there to top up the mortgage.

The family arrived in the Sunshine Coast three weeks ago, and Rey is now earning 20% more, despite remaining with the same company.

Part of that is due to her receiving a promotion, but she has also benefitted from having her wage aligned to the Australian market. Rey works in finance for an energy company, advising businesses on how to decarbonise and embrace green energy.

Rey said she, her husband and their 15-month-old son, seemed to be one of many making the move.

“When I sold my car to a dealer, the seller asked me the reason why. When I told him, he mentioned that every day he had two to three customers selling their car for the same reason: moving to Australia.”

It was the same story with the moving company.

“They pushed us to give them a moving date because containers were getting full quickly due to people moving overseas,” she said.

Understanding the scale of the so-called “brain drain” is not straightforward. At the same time that many people are moving to Australia, a surge of migants is also coming into New Zealand.

The New Zealand Government no longer tracks the number of New Zealanders moving to Australia – a symptom of having scrapped departure cards in 2018.

Statistics NZ does provide an estimate, based upon Australian Bureau of Statistics data.

In the year to last September, there was a provisional net migration loss of 10,200 people to Australia​.

That was made up of 28,100 leaving for Australia, and 17,900 making the journey in the other direction.​

“Traditionally, there has been a net migration loss from New Zealand to Australia. This averaged nearly 30,000 a year during 2004 to 2013, and about 3000 a year during 2014 to 2019,” Stats NZ reported.

The Australian Bureau maintains quarterly data and in the year to the end of March, 38,430 New Zealanders arrived with the intention of staying.Compare that to Stats NZ data over the same period, and an estimated 6800 Australians arrived.​

That means 31,630 more Kiwis left to head to Australia, than Australians came to live here.

This data did not include the number of Australians or New Zealanders travelling returning home, but it does suggest an imbalance is developing.

The Australian Bureau recorded 12,650 New Zealanders arrived with the intention to stay during the first three months of the year – a 42% increase on the three months before.​

There are plenty of things to tempt Kiwis across the ditch, including higher average wages.

In New Zealand, an average full-time worker earns $1506 a week. In Australia, that figure sits at $1970.

Comparatively lower rents were also a draw for New Zealanders.

Whether a new citizenship pathway for Kiwis announced in April has contributed to a large-scale brain drain is up for debate.

Under the new rules New Zealanders have access to Australian citizenship and its benefits after four years.

For Rey, it was the clincher.

“When we made our decision, we heard during Anzac Day that New Zealanders are having the same rights as Australians and can apply for the citizenship after four years. We didn’t think twice,” she said.

A spokesperson for the Australian Bureau did not believe the pathway had triggered recent lifts in New Zealand arrivals, because changes only came into effect on July 1.

“NZ citizens are required to have already been living in Australia for four years prior to applying,” the spokesperson said.

“In addition to this, this pathway does not make it any easier to migrate to Australia as New Zealand citizens are already able to freely do this,” he said.

The New Zealand Institute of Economic Research (NZIER) expected the policy change would more likely encourage New Zealanders already in Australia to remain there rather than resulting in a significant loss of talent.

“It is possible that the policy change may lure more workers from New Zealand, especially in those sectors of strong demand in both countries, such as construction, health and hospitality,” a recent institute report read.

“However, we expect a continued recovery in net inflows of migrants and workers from other countries should compensate for this.”

The NZIER report noted there were five brain drain peaks: in the early 1980s, late 1980s, in March 2001 when the special category visa (SCV) came into effect, and during the global financial crisis and early 2010s – in other words, at time of economic stress.

Just as it is difficult to establish the scale of the brain drain in numbers, knowing who is coming in, and whether they fill skill shortages, is not straightforward.

The blind spot created by the removal of departure cards was picked up at the time by Stats NZ.

“Stats NZ noted at the time that the removal of the departure card provided no “statistical” advantages, and the loss of information on the occupation and destination of migrant departures were downsides of its removal,” a spokesperson said.

Stats NZ estimated 65,400 more people arrived than left in the year to March, although that figure has been prone to large revisions.

MBIE records the occupations of those arriving on visas that require an occupation to be listed.

A list of the 20 most common occupations of arrivals include builder’s labourers, carpenters, cooks, chefs, truck drivers, and personal care assistants.

These addressed a range of recognised shortages, including in the building industry, tourism, and in the health sector.

NZIER’s principal economist Christina Leung said the MBIE data suggested migrants were being matched to skills shortages.

“These results suggest we are bringing in workers for industries facing the most acute labour shortages,” she said.

In other sectors, however, the match-up doesn’t appear to have been achieved so well – for example in teaching.

In September, the Cabinet agreed to allocate $23.6 million to address teacher shortages, and increase the workforce by 177 domestic teachers and 760 international teachers for the 2023 teaching year.

Richard Owen, who is general manager of Immigration New Zealand said between July 4, 2022, and April 30, 2023, Immigration granted 88 temporary work visas for primary school teachers, 24 for intermediate teachers, and 220 for secondary school teachers, where the occupation has been required as part of the application.

This was unlikely to solve a workforce shortage that has been described by one long-serving sector worker as the worst he had seen.

And while teachers do not appear to be arriving in required numbers, there is plenty to tempt them abroad, according to 23-year-teacher Maina McCurdy.

The primary school teacher said migrating to Australia was a common topic of conversation in the staff room and over the dinner table.

She almost took a job in Australia that would have given her a $50,000-a-year pay bump, but didn’t because it would have required her to move within three weeks.

She had colleagues who had moved, however, and she said they were able to afford homes and international travel. Her next move would depend on how contract negotiations with the Government went, she said.

She said New Zealand was at risk of losing its best teachers, especially given the new pathway.

“Especially younger teachers – the money they get, I’m sure you’ve seen the figures, it’s not much more than minimum wage,” she said.

New Zealand Educational Institute (NZEI) president Mark Potter​ agreed there was a risk.

He recently returned from a conference in Washington DC, where a main talking point was an international shortage of teachers.

Potter said it was not just Australia threatening to poach teachers, and competition would also come from the likes of Hong Kong, Canada and the UK.

“Australia has a deficit of 5000 teachers and that’s expected to grow to 15k in the next five years, they’re not going to be able to fill that themselves,” Potter said.

Adding to the risk of a disconnect between arrivals and skills shortages, neither the New Zealand nor Australian Governments recorded the occupations of the Kiwis leaving for Australia.

Rey said her family’s move was permanent. They are already enjoying the atmosphere of the Sunshine Coast, and the greater variety of products easily on-hand.

Despite the Sunshine Coast having its own rental problems, Rey said rents were still cheaper than in New Zealand.

Rey is French, and moved to New Zealand seven years ago, where she met her husband, who is from Kazakhstan.