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Migration Trends and Outlook 2007/08

SKILLED/BUSINESS STREAM

Highlights

Introduction

The importance of skilled migrants has increased in recent years, reflecting the impact of New Zealand's tight labour market. New Zealand needs skilled migrants to contribute to growth in professional skills and growth in information and communications technology.

In 2007/08, 27,303 people (59percent of residence approvals through the New Zealand Residence Programme (NZRP)) were approved for residence through the Skilled/Business Stream.[61] Of these people, 25,434 (93percent) were approved through the Skilled Migrant Category (SMC), 1,163 (4percent) through the Residence from Work Category, and 689 (3percent) through the Business Immigration Policy.

This chapter reports the analysis of residence approvals through the Skilled/Business Stream in 2007/08.

Skilled Migrant Category approvals

The SMC is the main category in the Skilled/Business Stream. It is a points-based system designed to ensure that people migrating to New Zealand have the skills, qualifications, and work experience New Zealand needs.

A person who is interested in applying for residence through the SMC must first submit an expression of interest. Points are awarded for employability and capacity-building factors, including skilled employment, relevant work experience, qualifications, and age. In addition, applicants can claim bonus points for other factors, including having work experience or qualifications in an area of absolute skill shortage, having employment outside of Auckland, or having a New Zealand qualification. An expression of interest is entered into a pool if the applicant meets prerequisites for health, character, and English language proficiency, and has 100 or more points.[62] (The numbers of expressions of interest and people selected in 2007/08 are shown in Table M1 in Appendix M.)

In July 2007, the SMC was changed to improve its competitiveness and to align the characteristics of migrants more closely with New Zealand's skill needs.

Nationality of Skilled Migrant Category approvals

In 2007/08, 25,434 people were approved for residence through the SMC. SMC approvals accounted for 55percent of all residence approvals in 2007/08, which was unchanged from 2006/07, but up slightly from 54percent in 2005/06.

Figure 7.1 shows that the United Kingdom remains the largest source country of skilled migrants (27percent), although the proportion from the United Kingdom decreased from 2006/07 to 2007/08. South Africa, China, and Philippines were the next largest source countries (13percent each). SMC approvals from the Philippines increased strongly from 808 in 2005/06 to 3,233 in 2007/08.

Figure 7.1 Skilled Migrant Category approvals by source country, 2006/07 and 2007/08

Figure 7.1	Skilled Migrant Category approvals by source country, 2006/07 and 2007/08.

Data table for Figure 7.1

Age and gender of Skilled Migrant Category approvals

Principal applicants aged 20-29 years gain the maximum points for age (30points). Figure 7.2 shows that most principal applicants were aged 20-39 years (76percent) in 2007/08. Of these applicants, 40percent claimed the maximum points for age. The small proportion of principal applicants aged over 50 (5percent) reflects the maximum age limit of 55 under the SMC. Just over half the secondary applicants were aged under 20.

Figure 7.2 Age of approved Skilled Migrant Category principal and secondary applicants, 2007/08

Figure 7.2	Age of approved Skilled Migrant Category principal and secondary applicants, 2007/08.

Data table for Figure 7.2

The average age of principal applicants through the SMC was 33 years in 2007/08, which was unchanged from 2006/07, but a decrease from 35 years in 2004/05. The major reason for this decrease is the increase in young Chinese migrants (former international students) gaining residence over the period. Of the 4,516 Chinese SMC principal applicants approved in 2006/07 and in 2007/08, 91percent were aged 20-29 years; in comparison, in 2004/05, 88percent of Chinese SMC principal applicants approved were aged 20-29 years (862 out of 984 Chinese principal applicants).

In 2007/08, 12,145 females (48percent) and 13,289 males (52percent) were approved under the SMC. Two-thirds of approved principal applicants were male; in comparison, 59percent of approved secondary applicants were female (see Figure 7.3).

Figure 7.3 Gender of Skilled Migrant Category approvals by applicant type, 2007/08

Figure 7.3	Gender of Skilled Migrant Category approvals by applicant type, 2007/08 .

Data table for Figure 7.3

Points claimed by Skilled Migrant Category principal applicants

Table 7.1 shows the points SMC principal applicants were awarded in 2007/08. Different criteria operate within each point factor. For more information about the SMC, see the Immigration New Zealand website (www.immigration.govt.nz/skilledmigrant).

Sixty-nine percent of principal applicants gained points for their current employment and 15percent had an offer of skilled employment. In total, 9,506 SMC principal applicants (84percent) were awarded points for a job or offer of skilled employment in New Zealand, a similar level to that in 2006/07 (85percent). In 2007/08, 16percent of principal applicants were not awarded points for a job or offer of skilled employment.

More than half of all principal applicants (57percent) claimed bonus points for a job or a job offer outside the Auckland region, up slightly from 56percent in 2006/07. Auckland, Wellington, and Canterbury were the main regions of skilled employment (see Figure 7.4).

Figure 7.4 Region of skilled employment for Skilled Migrant Category principal applicants, 2007/08

Figure 7.4	Region of skilled employment for Skilled Migrant Category principal applicants, 2007/08.

Data table for Figure 7.4

Note: The table excludes principal applicants with an unknown region of employment.

Most principal applicants (67percent) gained points in 2007/08 for relevant work experience; 18percent gained bonus points for New Zealand work experience; and 20percent gained additional bonus points for work experience in an identified future growth area, an identified cluster area, or an area of absolute skills shortage. Sixteenpercent claimed bonus points for a job or job offer in an area of absolute skills shortage.

Table 7.1 Points claimed by Skilled Migrant Category principal applicants, 2007/08

Factor

Percent gaining points (%)

Total principal applicants 11,315
Skilled employment
Current skilled employment in New Zealand for 12 months or more 24
Current skilled employment in New Zealand for less than 12 months 45
Offer of skilled employment in New Zealand 15
Bonus points for employment or an offer of employment
Identified future growth area 5
Identified cluster area* < 1
Area of absolute skills shortage 15
Region outside Auckland 57
Partner employment or offer of employment 3
Relevant work experience
2 years 11
4 years 10
6 years 10
8 years 8
10 years 28
Bonus points for New Zealand work experience
2 years 12
4 years 4
6 years or more 2
Additional bonus points for work experience
Identified future growth area 3
Identified cluster area (2-5 years)* < 1
Identified cluster area (6 years or more)* < 1
Area of absolute skills shortage (2-5 years) 6
Area of absolute skills shortage (6 years or more) 10
Qualifications
Recognised basic qualification 69
Recognised postgraduate qualification 10
Bonus points for qualifications
Recognised New Zealand qualification 25
Recognised qualification in an identified future growth area 3
Recognised qualification in an identified cluster area* < 1
Recognised qualification in an area of absolute skills shortage 32
Partner qualifications 17
Close family support in New Zealand 7
Age (20-55 years)
20-29 years 43
30-39 years 35
40-44 years 12
45-49 years 7
50-55 years 4

Note

* Points are no longer awarded to people applying after July 2007.

In recent years, New Zealand has strengthened policy to encourage international students to stay and work in New Zealand. Students who have obtained New Zealand qualifications are facilitated entry as skilled migrants. In 2007/08, 79percent of SMC principal applicants had New Zealand-recognised qualifications (69percent with a basic qualification and 10percent with a postgraduate qualification). The percentage of principal applicants who gained bonus points for a recognised New Zealand qualification increased considerably from 17percent in 2006/07 to 25percent in 2007/08. Principal applicants claiming bonus points for qualifications in an identified future growth area, identified cluster area, or area of absolute skills shortage increased slightly to 35percent in 2007/08 from 32percent in 2006/07 and 31percent in 2005/06. Most of those with recognised New Zealand qualifications were aged 20-29 years and were typically from China, India, or South Korea.

In 2007/08, 9,281 principal applicants (82percent) were approved onshore. Of the onshore applicants, 87percent had a job offer or current skilled employment in New Zealand; in comparison, 2,034 were approved offshore (18percent). Of the offshore applicants, 69percent had a job offer or current skilled employment in New Zealand.

Occupation of Skilled Migrant Category principal applicants

The major occupational group Professionals continues to be the most common occupation group of SMC principal applicants (39percent in 2007/08 and 38percent in 2006/07) (Table7.2).

Table7.2 Main occupation* of Skilled Migrant Category principal applicants, 2006/07 and 2007/08
Major group 2006/07 2007/08
Number Percent (%) Number Percent (%)
Professionals 4,273 38 3,994 39
Technicians and Associate Professionals 2,109 19 1,998 19
Legislators, Administrators and Managers 1,979 18 1,764 17
Trades Workers 1,496 13 1,411 14
Service and Sales Workers 685 6 628 6
Agriculture and Fishery Workers 196 2 205 2
Plant and Machine Operators and Assemblers 182 2 157 2
Clerks 203 2 144 1
Elementary Occupations (including residuals) 31 < 1 32 < 1
Total 11,154 100 10,333 100

Notes

* Main occupation is the job the applicant spent the most hours doing in the past 12 months.

† Major group is coded to the New Zealand Standard Classification of Occupations.

‡ Elementary Occupations (including residuals) includes elementary occupations and occupations not listed in the New Zealand Standard Classification of Occupations.

This table includes all principal applicants, not just those with a job or job offer as in previous reports. Applicants whose occupation was classified as 'Not Stated' are excluded from the total.

The SMC attracted skilled migrants in a broad range of sectors in 2007/08, but the most common occupations included registered nurse, chef, secondary school teacher, book-keeper, and restaurant manager.

The proportions of people classified in each occupation group in 2007/08 were similar to proportions in 2006/07.

Residence from Work Category

For migrants, working temporarily in New Zealand can be a step towards gaining residence and settling in New Zealand permanently. Principal applicants, who are qualified in occupations that are in demand in New Zealand or have exceptional talent in the arts, sports, or culture, may get a temporary work permit as a step towards gaining permanent residence in New Zealand through the Residence from Work Category.[63]

The Residence from Work Category includes the Talent (Accredited Employers),[64] Talent (Arts and Culture), and Talent (Sports) Work Policies[65] and the Long Term Skill Shortage List.[66]

As at 30 June 2008, 9,134 principal applicants have been issued a work to residence permit through the talent work policies and the Long Term Skill Shortage List. Of these applicants, 4,009 (44percent) have been granted residence through the residence categories (see Table 7.3). A large proportion (65percent) of people granted a work to residence permit under the talent work policies and the Long Term Skill Shortage List went on to gain permanent residence through the SMC, and one-third were granted residence through the Residence from Work Category.

Table 7.3 Residence categories through which talent work policies and Long Term Skill Shortage List permit holders were granted residence, as at 30 June 2008
Residence category Work to residence permit Total
Talent (Accredited Employers) Long Term Skill Shortage List Talent (Arts and Culture) and Talent (Sports) Number Percent (%)
1995 General Skills Category 40 45 85 2
Skilled Migrant Category 1,636 956 21 2,613 65
Long Term Skill Shortage List 8 193 201 5
Talent (Accredited Employers) Work Policy 912 7 2 921 23
Talent (Arts and Culture) Work Policy 21 21 1
Talent (Sports) Work Policy 44 44 1
Partnership Policy 55 19 9 83 2
Other 24 11 6 41 1
Total who gained residence 2,675 1,231 103 4,009 100
Total work to residence permits granted 6,318 2,587 229 9,134
Percentage converted to residence (%) 42 48 45 44

As shown in Table 7.4, 1,163 people gained residence through the Residence from Work Category in 2007/08, up from 897 people in 2006/07. Most were approved through the Talent (Accredited Employers) Work Policy (77percent of principal applicants). About 18percent of principal applicants approved for residence through the Long Term Skill Shortage List recorded their main occupation as registered nurse. Occupations such as secondary school teacher, anaesthetic technician, electrician, and university lecturer were also prominent.

Table 7.4 Number of people granted residence through Residence from Work Category, 2006/07 and 2007/08
Residence from Work category 2006/07 2007/08 Total
Principal Secondary Principal Secondary
Long Term Skill Shortage List 70 106 87 125 388
Talent (Accredited Employers) Work Policy 281 417 367 536 1,601
Talent (Arts and Culture) Work Policy 4 6 2 2 14
Talent (Sports) Work Policy 8 5 19 25 57
Total who gained residence 363 534 475 688 2,060

In 2007/08, the 1,163 people approved through the Residence from Work Category came from 48 countries. The main source countries of the 475 principal applicants were the United Kingdom (60percent), South Africa (10percent), and the United States (4percent). Figure 7.5 shows the top five nationalities of Residence from Work Category approvals in 2007/08.

Figure 7.5 Source countries of approved Residence from Work principal applicants, 2007/08

Figure 7.5	Source countries of approved Residence from Work principal applicants, 2007/08.

Data table for Figure 7.5

Business Immigration Policy

The Business Immigration Policy aims to contribute to New Zealand's economic growth by increasing New Zealand's levels of human and investment capital, encouraging enterprise and innovation, and fostering international links.

The Business Immigration Policy comprises three categories: the Entrepreneur Category, Employees of Relocating Business Category, and Active Investor Migrant Policy.[67]

From 2002/03 to 2007/08, 16,400 people (4,961 principal applicants) were approved for residence through the Business Immigration Policy. The main source countries were China (5,684), South Korea (4,187), and the United Kingdom (2,002). Business migrants in 2007/08 represented 3percent of Skilled/Business Stream approvals (689 out of 27,303 people). Table 7.5 shows the composition of Business Immigration Policy approvals from 2002/03 to 2007/08.

Table 7.5 Business Immigration Policy approvals, 2002/03-2007/08
Category 02/03 (%) 03/04 (%) 04/05 (%) 05/06 (%) 06/07 (%) 07/08 (%)
Entrepreneur 7 43 61 84 90 87
Investor* 93 57 39 16 10 13
Total number who gained residence 3,751 3,701 3,493 3,440 1,257 689

Note

* The Active Investor Migrant Policy, but including the 2005 Investor Category.

The number of Investor Category approvals decreased steadily from 2002/03 to 2006/07, but until 2005/06 this decrease was offset by the growth in Entrepreneur Category approvals. Since 2005/06, the overall number of approvals through the Business Immigration Policy have dropped substantially (from 3,440 to 689).

Eighty-seven people were approved residence through the Investor Category in 2007/08. Table 7.6 compares the nationalities of Investor Category approvals from 2002/03 to 2007/08. In 2007/08, the United Kingdom was the largest source country of approvals (55percent), followed by China (14percent), then the United States (10percent). While the total number of approvals has fallen since 2002/03, the decrease has been most significant for approvals from China.

Table 7.6 Nationality of Investor Category approvals, 2002/03-2007/08
Nationality 02/03 (%) 03/04 (%) 04/05 (%) 05/06 (%) 06/07 (%) 07/08 (%)
United Kingdom 6 20 28 36 19 55
China 56 34 40 8 33 14
United States 2 5 7 10 10 10
Other 35 41 25 45 37 21
Total number who gained residence 3,495 2,101 1,361 538 129 87

The Long Term Business Visas Policy is a temporary immigration policy that caters for people who are interested in establishing a business in New Zealand, and may subsequently apply for residence through the Entrepreneur Category. People can also use the Long Term Business Visas Policy if they are interested in establishing a business in New Zealand but are not living permanently in New Zealand.

In 2007/08, 202 principal applicants were granted a long-term business visa, a slight increase from 170 in 2006/07 and 153 in 2005/06. Since the Long Term Business Visa Policy was introduced in March 1999, 5,149 principal applicants have been granted a long-term business visa. The number of long-term business visas granted has decreased considerably since the peak of 1,807 principal applicants in 2001/02.

Table 7.7 details the residence categories through which long-term business visa holders converted to residence. By 30 June 2008, 61percent (3,117 principal applicants) had converted to residence. Of these conversions, 2,597 principal applicants (83percent) converted through the Entrepreneur Category.

Table 7.7 Residence categories through which long-term business visa holders were granted residence, as at 30 June 2008
Residence category Number of principal applicants Proportion of conversions (%) Proportion of long-term business visa principal applicants (%)
Entrepreneur Category 2,597 83 50
1995 General Skills 118 4 2
Partnership Policy 114 4 2
Skilled Migrant 88 3 2
Investor Category 73 2 1
Other 127 4 2
Total conversions to residence 3,117 100 61
Total long-term business visa principal applicants 5,149 100

The rates of conversion to residence differ across the main nationalities of long-term business visa holders. Table 7.8 shows conversion rates to residence for the top 10 countries, with South Korea, China, and the United Kingdom the top three source countries. Fiji, however, had the highest conversion rate (79percent), followed by South Korea (65percent), then China (63percent).

Table 7.8 Rates of conversion to residence by nationality for long-term business visa holders, as at 30 June 2008
Nationality Number of long term business visa principal applicants Conversions to residence
Number Percentage (%)
South Korea 1,654 1,078 65
China 1,440 901 63
United Kingdom 635 337 53
Fiji 224 176 79
United States 149 54 36
India 149 78 52
South Africa 116 60 52
Malaysia 67 38 57
Japan 65 39 60
Hong Kong 55 31 56
Other 595 325 55
Total 5,149 3,117 61

There were 602 people granted residence through the Entrepreneur Category in 2007/08. Table 7.9 compares the nationalities of people approved through the Entrepreneur Category in the six financial years to 2007/08. South Korea and China were the largest source countries in 2007/08 (23percent), followed by the United Kingdom (21percent) and Fiji (7percent).

Table 7.9 Nationality of Entrepreneur Category approvals, 2002/03-2007/08
Nationality 02/03 (%) 03/04 (%) 04/05 (%) 05/06 (%) 06/07 (%) 07/08 (%)
South Korea 22 49 46 41 23 23
China 20 19 27 32 29 23
United Kingdom 14 4 4 7 15 21
Fiji 5 7 7 4 7 7
India 1 2 2 2 5 9
Other 38 18 13 13 22 17
Total number who gained residence 256 1,600 2,132 2,902 1,128 602


[61] The Skilled/Business Stream categories are described in section 1.6.1.

[62] Expressions of interest that have 140 or more points are selected automatically from the pool. Expressions of interest that have 100 or more points but less than 140 points are selected in sufficient numbers to meet the requirements of the Skilled/Business Stream.

[63] The Residence from Work Category is for applicants who are already in New Zealand on a work to residence permit and want to apply for residence.

[64] To qualify for residence through the Talent (Accredited Employers) Work Policy, principal applicants must have held a work visa or permit for at least 24 months with an accredited employer and received a minimum base salary of NZ$45,000 per year (if the associated work to residence permit or visa application was made before 30July 2007) or NZ$50,000 per year (if the associated work to residence permit or visa application was made between 31 July 2007 and 28 July 2008).

[65] To qualify for residence through the Talent (Arts and Culture) and Talent (Sports) Work Policies, principal applicants must have held a work visa or permit granted for at least 24 months; have been actively engaged in their declared field of art, culture, or sport throughout during the currency of that visa or permit period in New Zealand; and be sponsored by a New Zealand organisation of national repute in the declared field.

[66] To qualify through the Long Term Skill Shortage List, a suitably qualified applicant must have an offer of at least two years’ employment in New Zealand in an occupation on the list with a minimum base salary of NZ$45,000 per year. After two years, the permit holder may apply for residence if they continue to meet the policy’s requirements.

[67] The Active Investor Migrant Policy comprises three subcategories: General (Active) Investor, Professional Investor, and Global Investor.