"There is a correlation between trans-Tasman migration and the relative labour market performances in New Zealand and Australia, Infometrics says. Photo: AFP
Record numbers of people leaving New Zealand to work in Australia could have a negative affect on the workforce over the medium-term.
A report by economic think tank Infometrics shows Australia's rate of unemployment was lower than New Zealand's in the first quarter of this year, which was a break from the average rate between 2014 and 2018 when Australia's rate was 0.7 percentage points higher than New Zealand's.
"There is a definite correlation between trans-Tasman migration and the relative labour market performances in New Zealand and Australia," Infometrics director Gareth Kiernan said in the report.
"The latest figures for the March 2024 quarter show that Australia's unemployment rate is now 0.4 percentage points below New Zealand's rate - the worst relative result, from New Zealand's perspective, since 2012.
"It's little wonder that more people are looking for better opportunities across the Tasman."
He said the largest group of people leaving New Zealand were between the ages of 25 and 44, which was a concern for the labour market.
"If we take these figures alongside the age breakdown of migrants entering or leaving the country, it seems likely that much of the country is experiencing a relative drain of its workforce of 25- to 44-year-olds," he said.
"And apart from a few urban areas and tourism-intensive hotspots, those losses are not being mitigated by an inflow of similarly aged people from overseas."
Kiernan said it was also interesting to see an increase in the number of people over 55 leaving New Zealand, following a spike up in the Covid-19 years.
"It may well be that as conditions have changed and the world has settled down a bit, and our economy is slowing, that some of those people are heading back overseas again," he said.
"There was some older people coming back in their sort of late 40s and early 50s - seeing some of those people leave again - that would match up with the previous flows that we've seen."