Bernard Hickey in The Herald is essential reading this morning:
Bernard Hickey: We need doctors, not bar staff
In all the hullaballoo this week about New Zealand’s record high migration, a strange fact has emerged. The number of approvals for permanent residence has fallen from more than 50,000 a decade ago to little more than 43,000 in the last full recorded year. It’s mainly because skilled migrant approvals for permanent residence have fallen from more than 35,000 to fewer than 23,000 in that time. Say what?
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But that still leaves more than 36,000 extra new migrants over the past year, compared with four years ago. Who are they, if they’re not permanent and high-skilled residents? The Ministry of Business, Innovation and Employment (MBIE)’s figures show international students made up about 20,000 of the increase. The rest came from higher numbers of people on temporary work visas. … The occupations of working holidaymakers and students able to work here aren’t given, but anyone frequenting the cafes, bars, dairies, Uber cabs and service stations of Auckland, Wellington, Christchurch and Queenstown will have a reasonable idea.And so does Treasury, which was this week an unusual ally for Peters, offering sustained criticism of the surge in temporary and student migration and a proposal for new entrepreneur migrants.
It released a series of papers over the past year that showed its growing discomfort with the increase in low-skilled migrants and the risk that they are displacing local workers and keeping wages down.
It’s by design.
“Current policy settings may not be doing all they can to support the growth of higher productivity firms and industries, including facilitating the flow of higher-skilled migrants to sectors of the economy where skill shortages may be acting as a significant constraint,” Treasury officials said.
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Helping employers to bring in low-skilled migrants instead of investing in new technology and becoming more productive so they can pay local workers more is essentially stunting our productivity and real GDP per capita.
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Key is right about the pressures on the system and the need for more houses, but he is wrong about our recent migration patterns making the country richer. It has made some richer by pushing up land prices in Auckland and beyond, but it has led to stagnant wage and real GDP growth and has lumped a big up-front infrastructure bill on to taxpayers in general and Auckland rate payers in particular. …
Go read the whole piece in The Herald.
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