Influx of migrants helps NZ

Migration records have pushed New Zealand's population growth to ''heady'' annual gains of 2%, but the issue of the ''stellar'' inward migration is a double-edged sword, cautions BNZ's head of research Stephen Toplis.

Seasonally adjusted, 5470 people arrived in New Zealand in the month of August alone, while for the year to August it was another record-break-ing 60,280, Mr Toplis said.

''Clearly this is a double-edged sword,'' he said.

The extent of the inflow put heightened pressure on an already stretched property market, but were the inflow to dry up, so too might the economic expansion, Mr Toplis said.

He said there was a lot happening in New Zealand's economy which suggested tougher times may be ahead, from commodity price slumps, the Christchurch rebuild peaking, effects of the El Nino weather pattern and economic confidence levels falling.

''But, for the time being at least, it seems inconceivable that New Zealand activity should start to contract when the population keeps growing at such a heady pace, largely driven by ongoing net migration inflows.''

When net migration inflows were added to natural growth, New Zealand's population was expanding at more than 2% per annum.

''All other things being equal, this means that GDP should be able to expand at around 0.5% a quarter from this source alone,'' Mr Toplis said.

Mr Toplis said net migration flows would eventually soften and take the New Zealand economy with them, but there was little sign of that yet.

The August record came as Indian and Chinese students continued to flock to courses offered by local educational institutions vying for the lucrative business.

The year to August net gain of 60,280 migrants was the 13th straight record month, Statistics New Zealand said.

Migrant arrivals rose 13% to a record 117,900, while departures fell 5% to 57,600.

Foreign students have been a boon to local education businesses.

In the latest year, student visas rose by 6400 to 26,800.

Of those, 10,600 were from India and 5100 from China.

Work visas issued climbed by 4600 to 35,900, with people from the UK the biggest single source at 6100.

Overall, India contributed most to a gain in migrant arrivals, at 12,700 in the year to August, followed by 8400 from China, 4500 from the Philippines and 3800 from the UK.

The decline in migrant departures was mainly due to fewer Kiwis leaving for Australia.

Departures of New Zealand citizens to Australia fell 16% to 21,600 in the August 2015 year, helping trim the net loss to just 500, the lowest level since 1991.

The net outflow to Australia peaked at 40,000 in the August 2012 year.

- Additional reporting: BusinessDesk

simon.hartley@odt.co.nz

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