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Migration Trends 2006/07

Temporary Migration

Introduction

Temporary workers and students make an important contribution to New Zealand’s economy. People on work permits are an important source of labour and skills, offering skills and experience that New Zealand employers need. Many work permit holders become permanent residents after some time in New Zealand, and there are specific work permit policies that promote this transition. There is now an established link between temporary workers and permanent, skilled migration.

International students contribute to New Zealand’s economic development through foreign exchange earnings, by promoting international links and by participating in the labour force after their study. A growing number of international students gain permanent residence in New Zealand after completing their studies. These students can offer employers New Zealand qualifications and, having participated in New Zealand society, are likely to settle well and contribute to New Zealand. This chapter describes the trends in the number of people coming to New Zealand on temporary student or work permits. [1] Appendix C provides a breakdown of the number of people issued work and student permits by nationality for the 2006/07 financial year.

Work permits

Anyone who wishes to work in New Zealand (except New Zealand or Australian citizens or residents) must have a work permit. The objective of work permit policy is to contribute to developing New Zealand’s capability base by allowing New Zealand employers to access global skills and knowledge. Work permit policy also aims to ensure that the employment of temporary migrants does not undermine the wages and conditions of New Zealand workers.

Work permit policy allows people to enter New Zealand for a variety of work-related purposes. Some policies allow employers to recruit temporary workers from overseas to meet particular or seasonal skill needs that cannot be met from within New Zealand. Other policies allow family members to participate in the labour market, and these migrants make an important contribution to the current environment of skill and labour shortages. Work permits are also issued to young people (aged 18–30 years) participating in Working Holiday Schemes, and to people applying through the Work to Residence policies. A full list of work permits is given in Appendix D.

The number of people issued work permits has increased substantially in recent years, with numbers growing at approximately 18 percent per year over the last decade. In 2006/07, 115,457 individuals were issued work permits, 16 percent more than in 2005/06. Figure 3.1 shows the growth in the number of people issued a work permit since 1997/98.

Figure 3.1 Principal applicants granted work permits since 1997/98

Data Table for Figure 3.1

Many factors have contributed to the growth in work permit numbers. These include the expansion of the Working Holiday Schemes, the introduction of new policies such as the Work to Residence policies and the Study to Work policies, and a growing number of work permits issued through the Partnership policy. In 2006/07, much of the increase came from working holidaymakers, seasonal workers, foreign graduates taking up the Study to Work policies, work permits issued to the partners of temporary workers or students, and an increase in the number of permits issued to people for specific purposes or events. [2] Figure 3.2 compares the broad categories of work permit types between 2005/06 and 2006/07.

Figure 3.2 Comparison of work permit types in 2005/06 and 2006/07

Data Table for Figure 3.2

Nationality of work permit holders

The UK was the largest source country of work permit holders in the current period (16 percent) followed by China (13 percent). The number of Chinese people granted work permits has increased significantly in recent years, from around 7,000 in 2004/05 to over 14,800 in 2006/07. Much of this growth has stemmed from the introduction of the Study to Work policies (July 2005) for international students upon the completion of their New Zealand qualification. In 2006/07, 79 percent of all Graduate Job Search permits (3,527 out of 4,458) were issued to Chinese graduates. Figure 3.3 provides a breakdown of work permit holders by nationality over the last three financial years.

Figure 3.3 Nationality of work permit holders: 2004/05–2006/07

Data Table for Figure 3.3

Of the main source countries, Malaysia and the Philippines have had the greatest proportional increase over the last twelve months – an 83 percent increase for Malaysia and a 68 percent increase for the Philippines. Malaysia and the Philippines each represented 3 percent of work permit holders in 2006/07. Much of the increase has been in the number of General work permits issued to applicants from both countries, Working Holidaymaker permits and Seasonal Labour permits for Malaysian applicants, and Skilled Migrant Work to Residence permits for applicants from the Philippines. Appendix E provides a breakdown of work permit holders by nationality since 1997/98.

Labour market tested work permits

Labour market tested work permits allow New Zealand employers to recruit temporary workers from overseas to meet shortages that cannot be met from within New Zealand, while protecting employment opportunities for New Zealand citizens and residents. They consist of the General work permit, permits issued under the Approval in Principle policy, some business policies, machinery installers, specialist skill areas, Seasonal Work Permit policy, and Japanese interpreters. [3]

In 2006/07, 34,353 people were issued a labour market tested work permit (30 percent of all work permits), 14 percent more than in 2005/06. [4] The UK has remained the largest source country with 14 percent of all labour market tested work permits in 2006/07, followed by China (8 percent). The number of approvals from the two main source countries has decreased, while approval numbers from some of the smaller source countries such as Brazil, Fiji, the Philippines, and Malaysia, have increased. Figure 3.4 provides a breakdown of labour market tested work permit holders by nationality over the last three financial years.

Figure 3.4 Nationality of labour market tested work permit holders: 2004/05–2006/07

Data Table for Figure 3.4

Occupations of people on labour market tested work permits

This section details the types of occupations recorded against work permit holders where the granting of the work permit is subject to a labour market test. This analysis excludes work permit holders approved on the basis of a family relationship, a Working Holiday Scheme, refugee claimants, or those issued to international students upon completion of their New Zealand qualification.

Table 3.1 lists the most common occupational groups recorded using the New Zealand Standard Classification of Occupations (NZSCO). The most common occupational group for labour market tested work permit holders was Agriculture and Fishery Workers (25 percent), the majority of whom were recruited through the Seasonal Work Permit policy or an Approval in Principle for seasonal work in the horticulture and viticulture industries. The second largest group were Service and Sales Workers (16 percent), followed by Professionals (15 percent).

Table 3.1 Most common occupational groups of labour market tested work permit holders

Occupational group	Number of work permit holders	% of work permit holders
Legislators, Administrators, Managers	2,396	8%
Professionals	4,601	15%
Technicians and Associate Professionals	3,813	13%
Clerks	841	3%
Service and Sales Workers	4,981	16%
Agriculture and Fishery Workers	7,483	25%
Trades Workers	2,935	10%
Plant and Machine Operators and Assemblers	2,565	8%
Elementary occupations*	691	2%
Total**	30,306	100%

* Includes occupations not listed in the NZSCO or unidentifiable responses.
** In 2006/07, 34,353 principal applicants were issued a labour market tested work permit, but the occupation was not recorded in every instance.

Table 3.2 Examples of the most common occupations of principal applicants issued a labour market tested work permit in 2006/07

Main occupation group	Examples of occupations
Legislators, Administrators, Managers	General manager Sales/marketing manager Project manager Restaurant/tavern manager
Professionals	Nurse Secondary school teacher University lecturer Medical doctor
Technicians and Associate Professionals	Sports coach, instructor, or trainer Telecommunications technician Automotive engineering technician Musician/conductor
Clerks	Researcher/research assistant Receptionist Accounts administrator
Service and Sales Workers	Chef Tour/travel guide Caregiver Security officer
Agriculture and Fishery Workers	Orchard/vineyard worker Dairy farm manager/worker
Trades Workers	Carpenter Electrician Baker Motor/diesel mechanic Fitter welder
Plant and Machine Operators and Assemblers	Sewing machinist Heavy truck driver General welder Ship crew member Bus driver
Elementary occupations	Builder's labourer Cleaner

Working Holiday Schemes

Working Holiday Schemes (WHSs) allow young people to experience living and working in New Zealand. The schemes help to strengthen international links and contribute to New Zealand’s economy through tourism and employment. WHSs allow 18–30 year olds from partner countries to spend 12 months (two years for UK working holidaymakers) in New Zealand and undertake work of a temporary nature. WHSs also allow young New Zealanders to work overseas under reciprocal agreements. New Zealand currently has WHSs with 26 countries with up to 50,000 places available.

The number of young people coming to New Zealand as working holidaymakers has increased steadily in recent years. In July 2005, a number of policy changes came into effect that increased the number of places available in many of the schemes, eased the work restrictions for some schemes, and introduced online processing for most applicants.

In the last two years, new WHSs have commenced. These include WHSs with Norway, Thailand and Estonia. There were 32,489 people approved through the various schemes in 2006/07, with the greatest numbers coming from the UK and Germany. The number of working holidaymakers has increased from 21,025 in 2004/05 and 28,540 in 2005/06. Table 3.3 shows the annual cap for each WHS partner country and the number of people issued Working Holidaymaker permits in 2006/07. In 2006/07, there were substantial increases in the number of working holidaymakers from South Korea, Malaysia, Germany, Czech Republic and Taiwan. Numbers from Ireland and Japan decreased.

Table 3.3 People issued Working Holidaymaker permits by country

Country	Places available in the scheme*	People issued permits in 2006/07*
Argentina	1,000	962
Belgium	2,000	176
Canada	2,000	1,524
Chile	1,000	785
Czech Republic	1,000	1,220
Denmark	2,000	267
Estonia	100	8
Finland	2,000	146
France	5,000	1,360
Germany	no cap	5,329
Hong Kong	200	162
Ireland	2,800	1,742
Italy	1,000	286
Japan	no cap	2,490
South Korea	1,500	2,030
Malaysia	1,150	750
Malta	50	6
Netherlands	no cap	701
Norway	no cap	47
Singapore	200	26
Sweden	no cap	555
Taiwan	600	1,059
Thailand	100	100
United Kingdom	no cap	8,559
United States of America	5,000	2,120
Uruguay	100	79
Total		32,489

* Individual schemes have differing years over which the annual cap operates, depending on when the agreement with each country was signed. Therefore the annual caps indicated do not correspond to a July–June financial year, and are only provided for the information of the reader.

Eleven percent more women than men were issued work permits across all WHSs. For some schemes, however, the gender differences were more notable. For the schemes with Japan, Taiwan, Thailand and Hong Kong, there were much higher proportions of women (at least twice as many) than men participating in the schemes. For other schemes, such as Chile, Italy and Uruguay, there were greater proportions of men, although overall numbers in some of these schemes were relatively low.

A high proportion of working holidaymakers were in their early twenties, with 39 percent between 22 and 25 years old. There were slightly more women than men across all ages with the exception of 20 year olds, where there were slightly more men. Figure 3.5 shows the age and gender distribution of working holidaymakers in 2006/07. Appendix F provides a breakdown of the ratio of women to men approved for all work permits (by age group and nationality) in 2006/07.

Figure 3.5 Age and gender of working holidaymakers in 2006/07 (n = 32,489)

Data Table for Figure 3.5

Student permits

The objective of student immigration policy is to facilitate the entry of foreign students, with a focus on attracting and developing students who have the skills and talent New Zealand needs. Export education is estimated to contribute over two billion dollars annually in foreign exchange to New Zealand. [5] In addition to the financial gain from student migration, host countries stand to benefit from the improvement of political and economic relations with sending countries. [6] In New Zealand, international students can also play an important role in the labour market through their labour participation post study, particularly if they are qualified, and gain employment, in areas of skills shortage.

Student policy

International students attending courses lasting over three months must apply for a student visa before travelling to New Zealand. Students from a visa waiver country may apply for a student permit in New Zealand. Non-New Zealand residents are not required to obtain a student permit to attend a course for three months or less.

In July 2005, a number of policy changes came into effect, some of which were enhanced in November 2007. The aim of the 2005 changes was to make New Zealand a more competitive destination for international students by easing the work restrictions for students and their partners. Since July 2005:

• international students who graduate from a course that would gain points under the Skilled Migrant Category have been eligible for a six-month open work permit (Graduate Job Search permit) – the duration of this permit was increased to 12 months from November 2007
• some students are eligible to apply for a two-year post study work permit to obtain practical work experience relevant to their qualification – from November 2007, this permit was increased to 3 years for graduates who require 3 years work experience in New Zealand to qualify for membership or registration with professional bodies
• the pool of students eligible to work part-time while studying has been expanded to include Year 12 and 13 school students and some English language students, provided certain conditions, including English language standards, are met
• eligible students have been able to apply to work for up to 20 hours a week during term (previously the limit was 15 hours)
• anyone undertaking a course of 12 months or more can apply to work full-time over the summer holidays
• partners of students studying in areas of absolute skill shortage and partners of all post graduate students can apply for an open work permit valid for the duration of the student’s course of study.

Student approval numbers

New Zealand’s international student population grew rapidly from 1999/00, peaking in 2002/03 with over 87,000 students issued a permit. More recently, however, the number of students coming from New Zealand’s main source country, China, has been in decline. Decreasing numbers of Chinese students have had a marked impact on the overall numbers of international students, but growth in permit numbers from many other source countries has helped to offset the downward trend. Figure 3.6 shows the growth in international student numbers since 1997/98.

Figure 3.6 Principal applicants granted student permits since 1997/98

Data Table for Figure 3.6

In 2004, the government announced a significant commitment to supporting international education. This commitment was increased in April 2005, bringing the government’s investment in international education to over $70 million over the five years beginning June 2004. [7]

Total student numbers continued to decrease in 2006/07 but much less so than in the previous two years. In 2006/07, 67,147 people were approved to study, down 3 percent from 69,223 in 2005/06. In 2006/07, the decrease of over 6,400 permit approvals from China was offset by increasing numbers in eight out of the top ten source countries.

Student numbers from South Korea increased by 10 percent from 10,100 in 2005/06 to 11,100 in 2006/07, the first increase since 2002/03. The number of students from some of the smaller source countries, such as India, Germany, Malaysia and the Philippines, continue their upward trend. For India, the increase was 30 percent in 2006/07.

Research published by the Ministry of Education shows that the reduction in international students between 2002 and 2005 had a significant impact on enrolments in schools, English language training providers and private tertiary education organisations.[8] Conversely, enrolments in public tertiary education institutions have increased in recent years and accounted for 43 percent of enrolments in 2005.

In 2006/07, Chinese students accounted for 30 percent of those issued a permit, followed by South Korea (17 percent), Japan and India (5 percent each). Japanese student numbers have continued to decrease since 2002/03, but the Ministry of Education’s enrolment data shows an increase in Japanese students enrolled in English language schools. This anomaly may indicate that many Japanese students are undertaking short courses while on a visitor permit. [9] New Zealand’s international student population is remarkably diverse, with permits granted to students from over 150 nationalities in 2006/07. Appendix G provides a breakdown of student numbers from the top source countries since 1997/98.

Students approved offshore

The number of international students approved offshore (student visas) is an indicator of the number of new students coming to study in New Zealand. Offshore approval numbers decreased steadily after 2001/02, but have been on the increase in the last two years. In 2006/07, offshore approvals were 22,260, 17 percent up on the 19,050 in 2005/06. Offshore approvals from China increased for the first time since 2001/02, although numbers remain relatively low compared to 2001/02. In 2006/07, offshore approval numbers increased for eight of the top ten source countries, with relatively large increases from India, South Korea and the Philippines. Figure 3.7 shows the number of offshore approvals from the largest source countries in the last four financial years.

Figure 3.7 Number of students approved offshore for the top source countries: 2003/04–2006/07

Data Table for Figure 3.7

Age and gender of international students

More males than females were issued a student permit in 2006/07, although the ratios vary considerably between different source countries. Among the main source countries, India had the lowest proportion of females relative to males. For Japan and the USA, females outnumbered males. Table 3.4 details the gender ratios by age group and nationality for the main source countries in 2006/07 (see Appendix H for greater detail).

Table 3.4 Ratio of females to males by age group and nationality for student approvals in 2006/07

Nationality	Age group
	0-15	16-19	20-29	30+	All ages
China	1.01	0.83	0.80	1.52	0.82
South Korea	0.83	0.88	1.07	0.99	0.90
Japan	1.85	1.76	1.45	1.52	1.66
India	0.71	0.35	0.29	0.75	0.38
USA	0.99	1.34	1.31	1.00	1.24
Others	0.97	0.91	0.91	0.93	0.93
Overall ratio	0.94	0.95	0.84	1.03	0.90
Total approvals	16,278	13,838	32,939	4,092	67,147

Student transitions to work

Internationally, foreign students have become an increasingly important target of immigration policies that aim to attract and retain talented migrants. [10] For many students, the prospect of gaining residence in the host cou ntry plays a role in their decision to study abroad. [11] New Zealand’s Student policy changes introduced in July 2005, and enhanced in November 2007, were intended to facilitate the transition from study to work and residence by creating more opportunities to work while studying, and allowing greater access to work permits post study.

In 2006/07, 4,458 students were issued the Graduate Job Search work permit, a similar number to 2005/06. Applicants are not required to have a job offer for this permit, but must have completed a New Zealand qualification that would qualify for points under the SMC, and must apply within three months of the end date of their student permit for that qualification. In 2006/07, 79 percent of students issued the Graduate Job Search work permit were Chinese. The next largest source country was India (6 percent), followed by South Korea and Malaysia (2 percent each).

The number of people issued a two-year work permit to obtain practical experience suitable to their course or qualification increased from 1,135 people in 2005/06 to 3,824 in 2006/07. Applicants for this work permit type must have completed a minimum three-year course or completed a qualification that would qualify for points under the SMC, and must have a job offer relevant to their course of study. Of those issued this work permit type, 78 percent were from China, followed by India (9 percent), South Korea and Malaysia (2 percent each).

Transitions from temporary to permanent residence

Linking temporary immigration policy with residence policy can have significant benefits for both migrants and New Zealand. Having participated in New Zealand society, temporary workers and students are likely to settle well and contribute to the country. Research has shown a positive link between migrants’ work experience in New Zealand prior to residence and their employment outcomes after gaining residence. [12]

This analysis examines the cohort of people approved for permanent residence in 2006/07 and identifies any previous temporary permits held by these migrants. The analysis shows that, of the 46,964 people approved for residence, 89 percent of principal applicants and 70 percent of secondary applicants had previously held a temporary permit. Ninety-two percent of Skilled/Business principal applicants previously held a temporary permit, compared to 89 percent of Family Sponsored principal applicants and 65 percent of International/Humanitarian principal applicants.

Figure 3.8 shows the proportion of people, by nationality, who held a temporary permit prior to residence approval. Of the top ten residence nationalities in 2006/07, over 95 percent of principal applicants from South Korea, the USA and the Philippines had held a temporary permit prior to residence approval.

Figure 3.8 Proportion of people granted residence from the main source countries in 2006/07 who had previously held a temporary permit

Data Table for Figure 3.8

Most recently held temporary permit

The most recently held temporary permit was identified for those migrants who had held a visitor, student, or work permit prior to residence. Work permits were the most recently held temporary permit type for principal applicants with prior experience in New Zealand (73 percent), while visitor permits were the most recently held permit type for secondary applicants.

Table 3.5 shows that there were considerable differences between principal and secondary applicants, and between people approved through the various streams. Of those secondary applicants who had held a temporary permit, 38 percent had most recently held a visitor permit, 31 percent a student permit and 31 percent a work permit. Many secondary applicants were dependent children, and therefore, a much lower proportion of secondary applicants held a work permit prior to residence.

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