‘Economic refugees’ flee from New Zealand as cost-of-living crisis deepens

Once recognized by the world as a picturesque and progressive safe haven, New Zealand’s frail economy has pushed many of its citizens to leave the country.

Amid high prices, steep interest rates and elevated unemployment, the government recently estimated that 131,200 people fled the country in the past 12 months through June, a record high. Among those, about 80,200 were citizens, nearly 70% higher compared to the year ended June 2019, before the pandemic.

Wilson Ong, 32, who works as a manager and buyer in New Zealand’s fashion retail industry, has seen many of his friends leave, and he’s planning to join them.

“For me, the key factor is quality of jobs,” he said. “In New Zealand, you feel limited in terms of job opportunities and what you can gain in work experience.”

It’s long been common for New Zealanders, also known as kiwis, to seek experiences abroad, with strict Covid-19 lockdowns having delayed many travel plans.

However, Ong also represents a growing dissatisfaction amongst millennial and Gen Z kiwis over the worsening economy, according to one economist. 

More than 50% of New Zealand’s emigrants in the year ended June 2024 were people aged between 20 and 39, according to government statistics, with those between 25 and 29 making up the largest group.

“Over the course of the last year and a half, the New Zealand economy has been slowing, and job losses are beginning, especially for the youngest generations,” said Shamubeel Eaqub, principal economist at the New Zealand Institute of Economic Research. 

“Until the job market improves, I wouldn’t expect those economic refugees to stop leaving from New Zealand,” he said.

Cost-of-living crisis

Early in the pandemic, the New Zealand government implemented strict lockdowns and a mandatory 14-day managed isolation facility for those arriving into the country, in an effort to eliminate Covid.

Before managed isolation was enforced, then-Prime Minister Jacinda Ardern said that nearly 40,000 kiwis had returned home between Match 20, 2020, and April 9, 2020 — more than all the hotel rooms available across the country.

New Zealand was later lauded for a speedy pandemic response that eliminated the virus for long periods, leading to low mortality rates.

Ong had postponed plans to move to England in 2020, and decided to stay in New Zealand, which he saw as a safer place to wait out the pandemic. He became a beneficiary of Covid-era wage subsidies and was later able to return to his previous job in the country’s biggest city, Auckland. 

But these subsidies have since dried up and many small business that had closed during pandemic lockdowns never reopened. Meanwhile, persistently high inflation has reduced the purchasing power of the country’s roughly 5 million consumers.

In the June quarter 2022, New Zealand’s annual inflation rate hit 7.3%, its highest level in over three decades. While it has since cooled to 3.3% as of June quarter 2024 , it remains over The Reserve Bank of New Zealand’s medium…