Settlement Patterns and the Geographic Mobility of Recent Migrants to New Zealand
This paper uses census data to examine the characteristics of local areas that attract migrants and gauges the extent to which migrants choose to settle where there are the best labour market opportunities as opposed to where there are already established migrant networks. We estimate McFadden's choice models to examine both the initial location choice made by recent migrants and the internal mobility of this cohort of migrants five years later. This allows us to examine whether the factors that affect settlement decision change as migrants spend more time in New Zealand.
Our descriptive results demonstrate that recent and earlier migrants live in highly concentrated locations compared to the NZ-born and that earlier migrants are more mobile than the NZ-born and are more likely to have been overseas at the time of the previous census. These results also suggest that recent and earlier migrants are more likely to live in LMAs that have denser networks of migrants from the same region of birth, larger foreign-born populations and larger populations, in general. There is also weaker evidence that these migrants are more likely to live in areas with better economic opportunities, in particular, in LMAs with higher average wages.
Turning to our regression results, we find consistent evidence that the density of migrant networks have a large impact on where recent and earlier migrants choose to settle. In particular, migrants are more likely to settle in LMAs in which a larger proportion of the previous immigrant population from their same region of birth are living, but not the same region of birth and skill-group. On the other hand, once we control for the strength of region of birth migrant networks, our results indicate that recent and earlier migrants are less likely to settle in LMAs with proportionally greater foreign-born population, but are more likely to settle in areas with a greater foreign-born population of similarly skilled individuals. The magnitude of these effects for earlier migrants compared to those for recent migrants are generally smaller for region of birth networks, but larger for foreign-born population networks.
We find no evidence that recent migrants choose to settle in LMAs with better labour market outcomes for either the general population, previous migrants from the same region of birth or individuals with the same skill-level. On the other hand, we find that earlier migrants choose to (re)locate in LMAs with better labour market outcomes for the general population, but not in LMAs with better labour market outcomes for previous migrants from the same region of birth or individuals with the same skill-level. This is the only indication that local labour market conditions may have an impact on where migrants settle and provides suggestive evidence that local labour market conditions become a more important determinant of where migrants live the longer they are in New Zealand. The relative strength of migrant networks over local labour market conditions as a factor in migrants' settlement choices is particularly striking in a country like New Zealand that has immigration policies that favour skilled migrants. For countries that do not select immigrants primarily for their potential labour market contribution, the dominance of migrant networks is likely to be even more pronounced.