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Migration Trends and Outlook 2010-2011

2   GLOBAL OUTLOOK

2.1   Introduction

In line with the continuation of poor global economic conditions, almost all OECD countries experienced declines in their Gross Domestic Product (GDP) in 2009, and across the OECD, GDP fell by almost 3.6 percent. Australia was one of only four countries (the others being Israel, Korea, and Poland) to experience modest but positive growth. In line with this, employment across the OECD fell by 1.8 percent in 2009. These tough economic conditions continued to have an impact on global migration flows, with the OECD stating that the 'environment for labour migration could scarcely be less favourable'.^[1] Both free movement and employer-driven migration have shown the consequences of the fall in labour demand.

This chapter overviews the changes in migration flows globally (and particularly across the OECD), in the context of the economic downturn. It compares immigration statistics and demographic data between New Zealand and other OECD countries. Most of the data for this analysis comes from the OECD's International Migration Outlook 2011 and other OECD data sources.^[2] This report also discusses trends in global migration policies, and these are summarised at the end of the chapter.

2.2   Permanent migration flows

Across OECD countries permanent inflows declined by almost 7 percent in 2009, an even greater relative decline than in the previous year (5 percent).^[3] The decline of 9 percent in New Zealand was roughly in line with this. While several countries (including Australia, Canada, the United States, and the United Kingdom) experienced an increase in permanent migration, almost half of OECD countries had decreases of greater than 10 percent (including many western European nations).

One reason identified by the OECD as contributing to continued increases in migration to Australia and Canada was that permanent migration to those countries is not directly responsive to changes in immediate labour market needs. Most permanent migration to the United States consists of family migration, which similarly does not relate to employers' labour needs. The increase in the United Kingdom, on the other hand, related to increases in the number of temporary migrants moving to permanent status. This more than offset what would otherwise have been a decline in permanent inflows.

As was the case in the previous year, free movement migration accounted for much of the decline in 2009, dropping by 22 percent.^[4] There were, nevertheless, 840,000 movements despite the adverse economic conditions. These reflected both migration for family reasons, as well as movement to find work in countries less affected by the crisis.

Labour migration also declined across the OECD, but not to the same extent as free movement migration (dropping by 6 percent). It is worth noting, however, that some of this migration represents changes in status from temporary to permanent, rather than actual border crossings (as in the case of the United Kingdom, discussed above). The smaller decline may reflect the fact that many of these migrants were already in the country's labour market, and not necessarily recruited from overseas.

Other categories of migration (family and humanitarian) which tend to be less responsive to economic conditions showed less change in 2009. There was almost no drop in family migration, while humanitarian movements declined by less than 3 percent.

Figure 2.1 shows that inflows relative to the total population were lowest in Japan (0.1 percent) and highest in Switzerland (1.5 percent) in 2009. New Zealand's rate of 1.1 percent continues to be higher than most other OECD countries. Australia was the only country other than Switzerland and New Zealand to have an inflow rate of 1 percent or greater.

Figure 2.1: Permanent inflows into selected OECD and non-OECD countries, as a percentage of the total population, 2009

Data table for Figure 2.1

2.3    Temporary worker migration

Weakening demand in the global labour market had a large impact on the flows of temporary workers, declining by 16 percent in 2009. This followed a smaller 1 percent drop in the previous year, which was preceded by almost a decade of increases. Temporary worker numbers were around 1.9 million, considerably higher than the number of permanent migrant (1.5 million) inflows.

Figure 2.2 illustrates that almost all countries in the OECD saw declines in the number of temporary workers admitted in 2009. At the most extreme, Spain, Belgium, and Norway saw decreases of well over a half (over 90 percent in the case of Spain). In this context the drop of 12 percent in New Zealand could be seen as relatively modest, and was in line with falls seen elsewhere in the OECD. Australia was one of four countries to experience modest increases, while Mexico had a large increase of almost a third (albeit from a very low base).^[5]

Figure 2.2: Percentage change in temporary worker migration in OECD countries, 2008 - 2009

Data table for Figure 2.2

Temporary workers include migrants from a wide range of backgrounds, working in a range of occupations. The largest category is seasonal workers, who make up more than a quarter of the total, and are largely low-skilled workers in the agricultural sector. The number of these workers in the OECD fell by 13 percent in 2009, much of which was due to an enormous decline in the demand for seasonal work in Spain. More than half of the seasonal workers in 2009 were employed in Germany.

Working holidaymakers were the next largest category of temporary worker, making up a fifth of the total, and with numbers dropping in 2009 by only 6 percent. Australia accounted for around half of working holidaymakers, while the United States hosted around a quarter. Finally, over half of all temporary workers in the OECD belong to a wide range of other categories, including trainees, intra-company transfers, short order cooks, home long-term care workers, and au pairs.

2.4    Changes by source country

The decline in migration discussed above was concentrated in source countries from Europe and the Americas, with flows declining by 27 percent and 14 percent respectively. Migration from Oceania (including New Zealand) decreased less substantially, with a drop of 4 percent overall, while flows from Africa and Asia were almost unchanged.

In 2009 the top 25 source countries accounted for 61 percent of all immigrants (see Figure 2.3 for a breakdown). Of the top 10 source countries of migrants to New Zealand, half are also on the list of top 10 source countries into OECD countries overall (China, India, the Philippines, the United States, and the United Kingdom). The remaining top 10 New Zealand sources were South Africa, Fiji, Samoa, Korea, and Tonga, and of these only Korea was among the top 25 OECD sources.

Figure 2.3: Top 25 countries of immigration into OECD countries, 2009

Data table for Figure 2.3

China was the largest source of migrants within the OECD, and the second largest source of migrants to New Zealand. While flows of migrants to OECD countries from China decreased by 14 percent in 2009, they remained at levels more than 50 percent greater than in 2000.

2.5   International students

More and more countries have looked on international students as a source of migrants in recent years. As a result, the number of international students continued to rise in 2008, up 5 percent on 2007 across the OECD. The number of international students in New Zealand had been dropping year on year since the early-to-mid 2000s, to around 32,000 in 2008.^[6] Almost a fifth of international students in the OECD (over 400,000) came from China in 2009, while another 7 percent came from India, and 5 percent from Korea. This matched the top three source countries to New Zealand in 2010/11 (in the same order), as can be seen in Chapter 4.

Most OECD countries (including New Zealand) have implemented policies in recent years to encourage international graduates to stay on in the host country, and potentially to become permanent migrants. OECD figures for 2008 or 2009 across 14 countries showed estimated retention rates of between 17 percent and 33 percent (in Austria and Canada^[7] respectively). New Zealand's rate of 21 percent was towards the bottom end of this range, but was comparable with other countries.

Across the OECD, international students were equivalent to only around 3 percent of the population aged 20-24 in those countries. This highlights the limited potential of international students as a source of permanent migrants based on current numbers. Nevertheless, the New Zealand rate of 10 international students per 100 persons aged 20-24 in 2008 was second only to Australia across the OECD, and the potential is therefore much greater here.

2.6   Other migrant groups

International Migration Outlook 2011 discussed two other groups of migrants in further detail. These were service providers (including intra-company transfers within multi-national corporations) and asylum seekers. While these migrants do not figure prominently in the New Zealand context, they are important on a global scale, and we discuss them briefly for the sake of completeness. Service providers, described as 'persons crossing borders to provide services for a limited period to persons or enterprises or governments', were identified as a category which had grown in importance in recent years, but which was not always captured in temporary labour migration figures. Several issues were identified with statistics on this type of migration, and figures were not reported for New Zealand.

Entries of asylum seekers into OECD countries continued to be low in 2009 compared to historical highs in the 1990s or even to the lower numbers of the early 2000s. Around 363,000 asylum seekers entered OECD countries in 2009, virtually unchanged from 2008. Only around 340 asylum seekers entered New Zealand, a rate of 80 per million population. Only five OECD countries received fewer asylum seekers than New Zealand in 2009, and only six had lower rates of asylum seeker entry.^[8] There is no evidence that the number of asylum seekers changed significantly as a result of the global economic crisis.

2.7   Migrant employment and unemployment

Figure 2.4 shows the trend in unemployment rates in selected OECD countries over the last 4 years. The impact of the recession on unemployment rates between the June quarter of 2008 and the June quarter of 2009 is clear across all countries included. Nevertheless, the recession is still clearly being felt across the OECD, with an overall OECD unemployment rate more than 2 percentage points higher than in 2008. Of the countries included, only Germany had a lower unemployment rate in the 2011 June quarter than 3 years previous. In most countries (including New Zealand) the recovery has so far seen only modest drops in unemployment.

Figure 2.4: Harmonised unemployment rates in selected OECD countries, June 2009 and June 2011

Data table for Figure 2.4

As reported in the 2010 edition of the OECD's International Migration Outlook, immigrants were hard hit by the recession. For example, across the EU15^[9] the increase in the unemployment rate of the foreign-born between the first three quarters of 2008 and 2009 was 3.4 percentage points, double that of the native-born. International Migration Outlook 2011 looks at unemployment and employment rates over a longer period, through to the first three quarters of 2010. From 2008 to 2010 almost all OECD countries had large increases in the unemployment of foreign-born, and in almost all cases, this exceeded increases in the native-born. While this was the case also in New Zealand, the magnitude of the difference was far less than in most countries.

2.8   Immigration policy responses

As in 2009, 2010 saw many countries adopt restrictive measures with respect to labour migration. This was particularly the case in Ireland and Spain, but also in the United Kingdom, where the new coalition government announced that net migration would be scaled back. Amongst other changes, a cap on labour migrants from outside Europe was introduced from April 2011. A big focus of the changes being adopted across the OECD has also been to ensure that migration meets labour market needs, now and in the future. Increasingly across the OECD migration is being considered as a response to demographic challenges. In Australia, for example, a Population Minister was appointed, with the task of developing a 'Sustainable Population Strategy', including migration planning as a key element.

Many more countries have been introducing points-based systems following the lead of New Zealand, Canada, and Australia. Since 2008, the United Kingdom, Denmark, and the Netherlands have introduced similar systems, while Austria has more recently announced their own system. The trend amongst those with established systems has been towards more restrictive selection. In Australia, changes in the General Skilled Migration Stream have been implemented to improve the quality of applicants, and the United Kingdom has also increased selectivity. Language ability has been identified as being critical to integration, and New Zealand stands alone amongst existing and new points-based systems in not providing points for language ability.^[10] Australia has recently increased the points available for high levels of English language ability.

Other trends are evident across OECD countries. For example:

• Skill shortage lists have become more widely used; however, the number of occupations on them have been decreased in many cases.
• More countries adopted policies designed to attract and retain international students.
• At the same time, many traditional destination countries have tightened up their student policies, largely to avoid fraud or backlogs.
• Family migration policies continue to become more restrictive in several ways, including the introduction and tightening of maintenance requirements to ensure family migrants do not become a burden on the host country, and imposing conditions of entry such as passing 'integration tests'.
• Many countries have tightened their asylum policies, although some have introduced concurrent measures to help facilitate the integration of asylum seekers and humanitarian migrants.
• Policies aimed at encouraging migrants to return to their countries of origin are growing.
• Integration remains a priority, with labour market integration taking centre stage. Integration programmes are being expanded, and action plans becoming widespread.

2.9   Outlook

With the global economic crisis affecting labour demand in recent years, there has been little international focus on the development of labour migration policy. Some countries, especially those without a strong history of labour migration, have liberalised their migration policies. Others, particularly English-speaking countries with high recent migration inflows, have increased their selectivity of migrants in response to the crisis. Outside of labour migration, the general trend is towards more restrictive policies, particularly towards family migration, where concerns about integration challenges persist.

The International Migration Outlook 2011 editorial suggests that, while migration flows have been affected by the economic crisis, they may not have been affected as much as would have been expected. It notes that 'as economies get back on their feet, the effects of ageing populations and workforces will begin to reassert themselves, and recourse to increased international migration will again look attractive as a way to help fill shortages and to help finance health and pension systems in deficit'. This scenario will present challenges as New Zealand competes to attract and retain the migrants it needs.

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^[1] OECD. 2011. International Migration Outlook: SOPEMI - 2011 edition. Paris: Organisation for Economic Co-operation and Development.

^[2] Ibid.

^[3] Based on the 24 countries with standardised statistics and the non-OECD Russian Federation.

^[4] This consists of movement within the European Economic Area and between Australia and New Zealand.

^[5] Despite these increases, temporary migration to Mexico was still less than a third the size of temporary migration to New Zealand.

^[6] Note that OECD figures only include students enrolled in full-degree programmes, and are therefore smaller than numbers reported for New Zealand elsewhere (including in this report).

^[7] Note that Canada's figures included international students changing to a different temporary status as well as those changing to permanent status, and as such may be over-represented. France, Australia and the Czech Republic also had stay rates in excess of 30 percent.

^[8] Korea, Slovenia, Portugal, Iceland, and Estonia had fewer entries, while Spain, Japan, Chile, Korea, Portugal, and Estonia had lower rates of entry.

^[9] The 15 European Union member states as at 1995. The Union has been subsequently expanded to include 27 members.

^[10] Although applicants for the New Zealand Skilled Migrant Category must be able to prove a high level of English language competency to be considered.

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