Opinion: The real story on immigrant work visas

Wellington economist Michael Reddell

Wellington economist Michael Reddell says a lot of people come into New Zealand under one visa and later change it to another.

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I wasn’t going to write about immigration today at all but a radio station rang up last night and invited me to go on its show this morning to discuss an article in today’s Herald that runs under the headline Top source countries for migrant workers are not Asian.

Since I had to get up early anyway, and since the article gives me the chance to make two points, I thought I’d respond.

Perhaps my key point is that flawed articles like this really should reinforce the message to MBIE, that I made in a post the other day that, while MBIE’s annual immigration approvals data are good and useful, they are only available with a long lag, and the monthly data they provide is limited, little-known, difficult to use, and therefore largely overlooked. If people can’t readily use that – accurate, official, administrative – data they will use what they can easily get. In this case, that is the permanent and long-term migration data derived from arrival and departure cards, and reliant on the self-reported intentions of people when they cross the border. It is published monthly and hogs the headlines, but for actual analysis of immigration policy (which affects non-citizens) it just isn’t good at all.

The Herald builds an article around this opening

A rise in work visas has been the driving force behind record immigration numbers but the main source countries are not from Asia.

A Herald analysis into immigration data found work visa arrivals increased from 16,787 in 2004 to 41,576 last year.

The top five source countries for work visas last year are the United Kingdom, Germany, Australia, South Africa and the United States of America.

They get those numbers not from data on the number of work visas issued, or outstanding, but on the basis of PLT arrivals data. When people arrive at the airport they complete an arrivals card, indicate whether (at that time) they intend/expect to stay 12 months or more, and the reason for their visit. The “reason for visit” isn’t tightly mapped to the various different visa classes, and all the non-New Zealand arrivals are grouped under four main headings (residence, student, visitor or work) and a small “other” category.

So these data are correctly reported by the Herald, but:

  • SNZ only publishes the data by previous country of residence, not country of citizenship (although they must have the latter data). The Herald should have been a little wary when it noticed Australia high up on the list, since Australian citizens don’t need work visas to live and work here. Published data don’t let us work out which country (citizenship) those people were actually from but, if someone worked in Australia for a couple of years and then came on to New Zealand, there is no meaningful sense in which they are “Australian.”

  • The PLT data only attempt to capture the visa people held at the point they crossed the border. Huge numbers of people change their visa while here – more than 70% of residence visas are granted to people who were already living here. Perhaps more importantly in this context, many people who come on student visas – probably almost all of those in the PLT(more than 12 months) category – now have work rights while they are here. And, when they complete their qualification, many can acquire a “study to work” work visa. So, if we are trying to understand which country the migrants (temporary or permanent) who are working here come from, the PLT numbers are barely any use at all.

In fact, MBIE knows exactly who has an outstanding work visa (which doesn’t include students working while on a student visa), and which country those people are citizens of. They now publish the data each year. Here are the top 10 countries as at 30 June last year.

Outstanding temporary work visas by country, as at June 30, 2016

The UK is still important but it is swamped by people from India, and China and the Philippines aren’t far behind the UK. We only have this particular data since 2009 but, back then, the UK was the largest source country for people with outstanding work visas. Since then, the UK numbers have only increased a little, while the Indian numbers have more than trebled. And all that is so even though these stock numbers include the numbers here on working holiday (work) visas, where European countries (Germany, UK, and France) dominate the annual approvals numbers.

What about approvals data? Here are the top 10 countries of people granted Essential Skills work visas in 2015/16.

Essential skills visas granted, by country, 2015/16

A decade ago, the UK was clearly the largest source country.

And here are the top 10 countries of people granted Family work visas (note, work visas – these aren’t the residence approvals).

Family work visas granted, by country, 2015/16

Again 10 years ago the UK was the largest single source country.

MBIE doesn’t provide this breakdown for those granted “study to work” visas, (even though the number of those visas granted has increased from around 6000 in 2005/06 to around 22000 last year).

Student visas granted, by country, 2015/16

And, since student visa numbers are totally dominated by people from Asian countries, we might reasonably assume almost all of the study to work visas have gone to citizens of Asian countries.

And finally, of course, there is the residence approvals programme. The overwhelming bulk of these approvals is granted to people already living in New Zealand, who arrived on one or other of the temporary visas programmes and eventually qualified for residence. Here are the top 10 countries, for 2015/16 and for 2005/06, 10 years earlier.

Residence approvals by source country

Total approvals didn’t change much over that decade but the composition (by source country) did.  One forgets, I suppose, but I was a little surprised to realise that even 10 years ago the UK was still far and away the largest single source country.

Which country our temporary or permanent migrants come from isn’t a big concern of mine, and has never been a focus of my analysis of the possible connection between immigration and economic performance. I don’t much care where migrants come from but about what skills and talents they bring. That said, I was interested in the new study by Harvard researchers that I linked to a few weeks ago, suggesting that if there were economic benefits from immigration (and that particular study reckoned there were) they were most evident when the migrants were from countries that are richer than the recipient country, or from countries with a degree of cultural similarity to the recipient country. Perhaps that result won’t stand up to close scrutiny over time but it does make quite a lot of intuitive sense. On that residence approvals list, only the UK and the US are richer than us.

And as a final note, I repeat my plea to MBIE to markedly improve the availability of such summary data on immigration approvals (and outstanding visas). They hold all the data, and there is no reason why these data could not be available, and easy to use, on a monthly or quarterly basis within a few days of the end of the relevant period. Debate about immigration policy is often difficult enough but it is made more so when the good timely data just aren’t made easily available, and people fall back on what they can find, inadequate for purpose as it often is.

Michael Reddell was at various times head of financial markets at the Reserve Bank and a New Zealand representative on the International Monetary Fund board. These days he blogs at www.croakingcassandra.com


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32 Comments & Questions

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I started reading this but mind wandered and I stopped as I remembered I don't actually care where immigrants are coming from - all I know is that 71,000 in 12 months insanely too much. The roads are crammed, infrastructure outpaced, housing absurd. It feels out of control - like the pilot is asleep and even if they tried he steering wheel doesn't work. Even worse - I think government are being willfully negligent immigration ; higher house prices make good politics.

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On what realistic basis? Just your "feel" is not good enough.

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You should care about where they are coming from as it's they who will dictate the sort of culture and values NZ will have. Have you ever lived in a Third World country? I have lived in several and there are reasons why the Third World is Third World and most people who have studied economics are not the people to ask why this is.

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This provision of work visas for unskilled workers, is a major issue, unfortunately this rambling regurgitation of the various steps this person took to determine what he had available to present a hypothesis on the issue, didn't allow him to determine anything except he needed more... All of which simply makes one think that the major lesson is; by reading the Herald to start with, such exposure must have instantly zapped his IQ to the point of feeling the need to match their drivel, with his own.

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Asian immigrants are fleeing their decaying(enviromentally & politically) countries to NZ, whose culture will be destroyed by this uncontrolled influx.

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More the merrier. NZ is vastly under populated.

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And being underpopulated is what makes us so appealing. Let's keep it that way.

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I think that's a simplistic viewpoint. An economist might agree with you but there's more to life than pure economics. Once you have people you can't put send them back again. Quality is much more important than quantity

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Huh? Placed shoulder to shoulder all 7.5 billion humans on this planet would fit into an area half the size of Croatia. By the reckoning of your fevered and feeble mind the world must therefore be severely underpopulated.

Consider that it took until 1800AD for the world population to make it to 1B. Since 1900 the pop has risen from 1.5B to its current 7.5B and despite all the associated ills you and all the other sheep support higher population numbers when a sharp correction, sooner or later, is what nature is going to make sure will happen.

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Its not that straightforward. most of the British and German visitors on student of short term work visas are just visitors ,or enjoying a long gap year or place to conduct their romantic affairs on the other side of the world away form family and friends . Immigration of those with the intent of becoming citizens from Western Europe, US, even Russia has clearly declined and been replaced by those from the desperate third world the Philliphines and India and those who desire to come here will be their fourth best on their fourth choice- inevitably they will have tried for access to Australia, Canada and probably the UK or a US green card first. The lower quality of those gaining permanent visas reflects the view of, PM English, that we have done our Dash with Uk, that Trump and Brexit are offensive and the future is with Asia and future is
orientating ourselves to Asia and the coming third world and brick nations. Mfat as usual are wrong about everything, much like Bill and Nick Smith. We are English Anglo celts after all.

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In fairness to me, NBR lifted this from my blog (with my permission). It was originally posted as background information - an aide memoire for myself (the background digging I'd done for a radio interview) rather than advancing any strong thesis.

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Not a reflection on your blog or work (which is highly impressive) - just bemoaning the fact government have lost control , even if there was a will to do something (which there isn't)

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Can we please stop referring to education as a valuable income earner for NZ? Let's face the truth; what these third grade 'colleges' in the back streets of Auckland are selling is a pathway to immigration. The only reason they make money is that true costs of their activity fall on the ratepayers and citizens trying to buy or rent a house or get to work on time.

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I agree - nearly all for profit education streams are driven by Australian private equity out to leverage the crap out of student, pay no tax, and get free capital gains. That's not what I want !! To heck with education sector for profits if they are f'ing our tax base

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This is helpful, and true. The way immigration works is very poorly understood. Had to laugh at this though: "On that residence approvals list, only the UK and the US are richer than us." As G54 or whatever we are, we might just pip Fiji and Samoa

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This government is not interested in facts it is only interested in drivel it can spin. Look at some of the house ownership data they now capture that fundamentally fails to addresses issues around overseas ownership.

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We've created a place where talent wants to live. Bravo - so let's let them live here.

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Ofcourse
When half of the migrants are low income unskilled workers I would hardly describe them as talent
More like migrants from third world countries wanting a better life - and good old NZ prevails and lets them in. What happens when this propped up economy stalls and we have record unemployment - or do we just open the floodgates and let anyone in and go bankrupt when we can't fund the infrastructure and services required to accommodate these people

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And you know what, the people who collect the rubbish, stack the supermarket shelves, aid and clean the elderly, dag and load lambs, bring in and milk the cows, are all people who I rank as much much more important than a "Mayor", a "Lawyer" and especially those wasters who come out of university calling themselves "economists" and swan about tossing numbers in the air at the RB or Treasury, all at taxpayers expense, for the rest of their lives.
[Edited]

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These jobs were once done by New Zealanders. What happened? Did New Zealanders suddenly all become meth-heads and pot smokers as the last two PMs would have you believe? The dole is not a lifestyle choice and it's virtually impossible to survive on. Try and think a little before spewing your pro-immigration bile.

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excuse me? "these jobs" are still done by New Zealanders. Sure some are new nzeders but then so too are some of our Doctors, Dentists, lawyers, mayors and "economists" new NZ eders!!

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Possibly this sort of sweeping assertion reflects someone too PC too think. The requirement to get NZ citizenship is a lot lower than the rest of the advanced west. We allow dual citizenship and for the new arrivals to maintain most of their assets overseas ( this is of course true of many lifelong New Zealanders, possibly in part even yours truly) and we don't really require real declarations of loyalty and advanced western values, is at least tolerance of abortion, prostitution, strip bars, divorce, gays, legal equality, racial and religious diversity and a right to oppose authority and reject collectivism. A right to individualism, sex and beauty and to be considered for government and political employment.
The extremely low standards for NZ citizenship reflects the low regard for our own nation of our political elite, who regard communist China as morally superior and probably Upper Volta, Gaza and Jong's NK as moral equivalents.

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I often enjoy your musings Lance but that is seriously deluded.

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It is not "seriously deluded". It is the sensible truth.
on reading these posts, most are trying to re-label what I call "filthy cowardly racism" as anti-immigration. And it is not working

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Don't really care where they come from. Except we should be kinder to our Pacific neighbours and refugees.
71k a year is way too many. More per capita than
the UK and the USA.

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Asian and Indian immigrants have turned Auckland into a slum. Everywhere just looks so sh#t. Berms overgrown everywhere, laundry drying on the road side like a Thai ghetto, 300 bums on Queen Street, every decent business folding cause no one has any discretionary income cause accom prices are so high, central city filled with $2 shit stores. Too late. #jobdone. It sucks here now.

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Ignorant's such as yourself need to be educated on generalizing ethnic groups. Not all Asians and Indians are making Auckland slums, have you gone to South Auckland? Have you been to rural New Zealand? Or has living in the Ivory tower's of CBD made you lose perspective on reality?
Be racist if you must, but don't judge a whole cast.

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An excellent article and a cautionary on accepting "evidence" at face value. Anecdotal evidence is not much better but I have just done a rare work trip (in the Coromandel and Waikato) and these same temporary work visa residents are flooding the low paying service sector jobs there, no doubt on visa scams. e.g. I am amazed how many commercial buildings are owned (and staffed) by Indians (nothing racist here, my best friend is Indian and he feels the same - he said he is more Kiwi than Indian now). The low level of activity in some outlets suggest their main purpose is to house 3 immigrant workers and qualify for business and work visas.

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The really disturbing aspect is that our media undertakes such lazy and slanted reporting. The 'Visa' article was taken up by all the mainstream channels. Where is the editorial rigor and oversight that is supposed to raise 'credible' news sources above the online flotsam. Too often now (constantly) we are being feed partisan doctrine utilizing factual gymnastics to promote a view, often motivated by some misguided social conscience. Can we please at least have one main news network in New Zealand focused on intelligent and factual reporting... evidence would suggest not. What does that say about the general public?

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well well well...perhaps the herald journos did only do a light once over?

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I have absolutley no issue with welcoming immigrants to NZ as we are all immigrants.

What I take issue with is whether or not the job could be done by a NZer and if not why not.

If we do not have NZers trained then they need to be but if the NZers do not want to do the job then fair play welcome to Aotearoa.

Also there are jobs that we are giving to immigrants that potentially by one means or another have not been offered to NZers and I do not accept that we cannot offer jobs such as hairdressers, diesel mechanics and retail managers to NZers.

I seem to remember the government offering incentives for Aucklanders to move out for jobs outside Auckland but this seems to be getting very little coverage now.

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Immigrtion no doubt aids the economy. no country (think Melbourne) wouldnt be whee it is today without Immigration. The debate here is how much and what type of Immigrants do we need. Then we need to look at why are the jobs not going to Kiwis. Several reasons but one is low wage and most kiwis choose not to do certain types of work. Think aged care givers.
Several sectors come in to play , businesses paying descent wages, locals getting skilled and accepting those very jobs that immigrants eventually end up doing due to availability of these jobs.
You cant just go blaming immigrants for that - all they are doing are seeking opportunities.

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