New Zealand's net migration increased strongly again in May as fewer New Zealanders headed across the Tasman.
Statistics New Zealand figures showed that 2700 new migrants were added to the country's population in May, an annualised rate of 26,400 in the past three months.
ASB economist Jane Turner said net migration had turned quickly in the past six months.
As a result, the pace of annual net migration had doubled, lifting from about 5000 a year to 11,200 in May.
"If current trends continue, net migration is well on track to reach almost 20,000 a year, if not stronger.
"We estimate that 20,000 new migrations would be consistent with working age population growth of about 1.6% by mid-2010, a small increase by historical standards.
"Nonetheless, the increase in population base will help provide timely support to retailing and the housing market which are currently at cyclical lows."
Australia had not been immune to the international credit crisis, with commodity prices hit hard and mining production particularly affected, she said.
Australia's unemployment rate had picked up at a similar pace to New Zealand's and with a more challenging labour market, New Zealanders were playing it safe by opting to stay put.
Departures to the United Kingdom had also slowed considerably, suggesting the financial crisis had curbed the number of young New Zealanders heading off on their OE, Ms Turner said.
The New Zealand economy had fared well through the credit crisis compared with the UK and the United States which had both experienced much sharper declines in gross domestic product and swifter increases in unemployment.
"Given this backdrop, it is a reasonably risky time to leave a job in New Zealand with hopes to find a new one overseas."
Permanent arrivals remained steady, lifting 1.2% in the month.
Asia remained the main source of arrivals.
Ms Turner said one interesting feature of recent months had been the slight increase in arrivals from Australia which could suggest New Zealanders were returning home.
For now, the number of New Zealanders returning made up the minority of arrivals, although that share had increased in recent months.
"Arrivals from the UK remain reasonably steady, suggesting that the financial crisis and rise in unemployment has not yet triggered a return of ex-pats which was behind the sharp increase in net migration earlier this decade."
At a glance
• Net migration at 6-year high
• Plunge in number of people leaving for Australia
• Global credit crisis keeps Kiwis at home
• Timely support for retail and housing markets.
