New quotas - and the market response
Oct 11th 2016, 11:49 am
#1
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New quotas - and the market response
NZ has announced it will be "tightening up" on immigration.
The NZ dollar has dipped in response.
Presumably this suggests that the rest of the world is not convinced that this will boost the NZ economy.
Pro immigration: you have to jump through many hoops and prove that you will be contributing or bringing in a lot of money. GDP growth over the last few years has allegedly been due to the money and earning power of new immigrants. Productivity by longer term NZ residents has not been growing.
Anti immigration: immigrants are being used to fill low paid jobs and undercut NZ residents in higher skilled jobs. This forces wages low. Combined with this, the influx of capital and extra people is straining the housing market and forcing up prices.
Balanced(?) view: as in the UK, imported labour from low wage economies forces down wages and thus factory/farm door costs and boosts export earnings and general business profitability. However the general population are not benefiting from the increase in the economy because the money is being taken from the poor and given to the rich. Low wages mean low tax revenue. However immigrants bring in both skills and capital which helps NZ grow as a nation. Without this there are real risks of a recession. So you are damned if you restrict immigration and damned if you don't.
Conclusion: apart from following world wide trends of blaming everything on immigrants (so not the fault of the people "managing" the economy) where is the evidence that the problems are due solely to immigration?
Note that although the bar has been raised from 140 points to 160 points for automatic selection from the Skilled Migrant pool as far as I know you can still get selected with fewer points once the automatic pulls have gone through. So possibly nothing has really changed apart from kicking the Parent Category who look to be the softest target in the run up to the next election.
Wages need to rise, and house prices need to stabilise and possibly fall. This raises the standard of living of the majority by increasing spending power, and also the money available from taxes to fund public services.
However this means a rising cost of production, a rise in prices (not just for manufactured and agricultural goods, but everyday things like the wages of the supermarket check out people) which in turn makes everything more costly. Falling profits, rising prices - this could mean a recession? At a minimum it could mean that investment from global capital is less attractive.
Which ever way it goes, to reverse the current trend is going to be painful at least in the short term.
Looking at the statistics, the biggest growth has been in the "uncapped categories for partners and dependent children". Other categories have been stable, but this has risen from around 9,000 in 2006 to around 12,500 in 2014/2015; that is over a third higher. Assuming that people are not suddenly bringing in more partners (O.K. there may be an increase in partnered against single) then the big increase is in children. Who are likely to be a big drain on health and education until they become productive. However they are the future!
TL;DR - what exactly is stopping parents coming to be near their children going to achieve? This targets around 3,500 people a year who already have to prove that they are either fully self supporting or have a family who earn enough to support them.
[It might boost the child care industry a bit and make all parents (not just migrants) pay more for child care whilst they work to pay their mortgage?]
The NZ dollar has dipped in response.
Presumably this suggests that the rest of the world is not convinced that this will boost the NZ economy.
Pro immigration: you have to jump through many hoops and prove that you will be contributing or bringing in a lot of money. GDP growth over the last few years has allegedly been due to the money and earning power of new immigrants. Productivity by longer term NZ residents has not been growing.
Anti immigration: immigrants are being used to fill low paid jobs and undercut NZ residents in higher skilled jobs. This forces wages low. Combined with this, the influx of capital and extra people is straining the housing market and forcing up prices.
Balanced(?) view: as in the UK, imported labour from low wage economies forces down wages and thus factory/farm door costs and boosts export earnings and general business profitability. However the general population are not benefiting from the increase in the economy because the money is being taken from the poor and given to the rich. Low wages mean low tax revenue. However immigrants bring in both skills and capital which helps NZ grow as a nation. Without this there are real risks of a recession. So you are damned if you restrict immigration and damned if you don't.
Conclusion: apart from following world wide trends of blaming everything on immigrants (so not the fault of the people "managing" the economy) where is the evidence that the problems are due solely to immigration?
Note that although the bar has been raised from 140 points to 160 points for automatic selection from the Skilled Migrant pool as far as I know you can still get selected with fewer points once the automatic pulls have gone through. So possibly nothing has really changed apart from kicking the Parent Category who look to be the softest target in the run up to the next election.
Wages need to rise, and house prices need to stabilise and possibly fall. This raises the standard of living of the majority by increasing spending power, and also the money available from taxes to fund public services.
However this means a rising cost of production, a rise in prices (not just for manufactured and agricultural goods, but everyday things like the wages of the supermarket check out people) which in turn makes everything more costly. Falling profits, rising prices - this could mean a recession? At a minimum it could mean that investment from global capital is less attractive.
Which ever way it goes, to reverse the current trend is going to be painful at least in the short term.
Looking at the statistics, the biggest growth has been in the "uncapped categories for partners and dependent children". Other categories have been stable, but this has risen from around 9,000 in 2006 to around 12,500 in 2014/2015; that is over a third higher. Assuming that people are not suddenly bringing in more partners (O.K. there may be an increase in partnered against single) then the big increase is in children. Who are likely to be a big drain on health and education until they become productive. However they are the future!
TL;DR - what exactly is stopping parents coming to be near their children going to achieve? This targets around 3,500 people a year who already have to prove that they are either fully self supporting or have a family who earn enough to support them.
[It might boost the child care industry a bit and make all parents (not just migrants) pay more for child care whilst they work to pay their mortgage?]
Oct 11th 2016, 6:49 pm
#2
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Re: New quotas - and the market response
It's only a 5% tightening target on current record levels.
Also on the economic question this must be looked at on balance. The point of economic measures is to understand and improve quality of life. The question is if higher net GDP growth is a larger benefit than house price inflation, low wages growth etc. On balance I find myself in the very difficult position of having to say the National government have taken a small step in the right direction here.
Also on the economic question this must be looked at on balance. The point of economic measures is to understand and improve quality of life. The question is if higher net GDP growth is a larger benefit than house price inflation, low wages growth etc. On balance I find myself in the very difficult position of having to say the National government have taken a small step in the right direction here.
Oct 11th 2016, 6:57 pm
#3
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Re: New quotas - and the market response
National back-tracking on two policies they said they wouldn't change:
State-housing and immigration.
There must be an election coming up.
State-housing and immigration.
There must be an election coming up.
Oct 11th 2016, 7:20 pm
#4
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Re: New quotas - and the market response
from what the Minister said on the news the parent category needs to be tightened up as the rules are being flouted and financial support is not being given as stated on the applications.
Oct 12th 2016, 9:46 am
#5
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Re: New quotas - and the market response
NZ has announced it will be "tightening up" on immigration.
The NZ dollar has dipped in response.
Presumably this suggests that the rest of the world is not convinced that this will boost the NZ economy.
Pro immigration: you have to jump through many hoops and prove that you will be contributing or bringing in a lot of money. GDP growth over the last few years has allegedly been due to the money and earning power of new immigrants. Productivity by longer term NZ residents has not been growing.
Anti immigration: immigrants are being used to fill low paid jobs and undercut NZ residents in higher skilled jobs. This forces wages low. Combined with this, the influx of capital and extra people is straining the housing market and forcing up prices.
Balanced(?) view: as in the UK, imported labour from low wage economies forces down wages and thus factory/farm door costs and boosts export earnings and general business profitability. However the general population are not benefiting from the increase in the economy because the money is being taken from the poor and given to the rich. Low wages mean low tax revenue. However immigrants bring in both skills and capital which helps NZ grow as a nation. Without this there are real risks of a recession. So you are damned if you restrict immigration and damned if you don't.
Conclusion: apart from following world wide trends of blaming everything on immigrants (so not the fault of the people "managing" the economy) where is the evidence that the problems are due solely to immigration?
Note that although the bar has been raised from 140 points to 160 points for automatic selection from the Skilled Migrant pool as far as I know you can still get selected with fewer points once the automatic pulls have gone through. So possibly nothing has really changed apart from kicking the Parent Category who look to be the softest target in the run up to the next election.
Wages need to rise, and house prices need to stabilise and possibly fall. This raises the standard of living of the majority by increasing spending power, and also the money available from taxes to fund public services.
However this means a rising cost of production, a rise in prices (not just for manufactured and agricultural goods, but everyday things like the wages of the supermarket check out people) which in turn makes everything more costly. Falling profits, rising prices - this could mean a recession? At a minimum it could mean that investment from global capital is less attractive.
Which ever way it goes, to reverse the current trend is going to be painful at least in the short term.
Looking at the statistics, the biggest growth has been in the "uncapped categories for partners and dependent children". Other categories have been stable, but this has risen from around 9,000 in 2006 to around 12,500 in 2014/2015; that is over a third higher. Assuming that people are not suddenly bringing in more partners (O.K. there may be an increase in partnered against single) then the big increase is in children. Who are likely to be a big drain on health and education until they become productive. However they are the future!
TL;DR - what exactly is stopping parents coming to be near their children going to achieve? This targets around 3,500 people a year who already have to prove that they are either fully self supporting or have a family who earn enough to support them.
[It might boost the child care industry a bit and make all parents (not just migrants) pay more for child care whilst they work to pay their mortgage?]
The NZ dollar has dipped in response.
Presumably this suggests that the rest of the world is not convinced that this will boost the NZ economy.
Pro immigration: you have to jump through many hoops and prove that you will be contributing or bringing in a lot of money. GDP growth over the last few years has allegedly been due to the money and earning power of new immigrants. Productivity by longer term NZ residents has not been growing.
Anti immigration: immigrants are being used to fill low paid jobs and undercut NZ residents in higher skilled jobs. This forces wages low. Combined with this, the influx of capital and extra people is straining the housing market and forcing up prices.
Balanced(?) view: as in the UK, imported labour from low wage economies forces down wages and thus factory/farm door costs and boosts export earnings and general business profitability. However the general population are not benefiting from the increase in the economy because the money is being taken from the poor and given to the rich. Low wages mean low tax revenue. However immigrants bring in both skills and capital which helps NZ grow as a nation. Without this there are real risks of a recession. So you are damned if you restrict immigration and damned if you don't.
Conclusion: apart from following world wide trends of blaming everything on immigrants (so not the fault of the people "managing" the economy) where is the evidence that the problems are due solely to immigration?
Note that although the bar has been raised from 140 points to 160 points for automatic selection from the Skilled Migrant pool as far as I know you can still get selected with fewer points once the automatic pulls have gone through. So possibly nothing has really changed apart from kicking the Parent Category who look to be the softest target in the run up to the next election.
Wages need to rise, and house prices need to stabilise and possibly fall. This raises the standard of living of the majority by increasing spending power, and also the money available from taxes to fund public services.
However this means a rising cost of production, a rise in prices (not just for manufactured and agricultural goods, but everyday things like the wages of the supermarket check out people) which in turn makes everything more costly. Falling profits, rising prices - this could mean a recession? At a minimum it could mean that investment from global capital is less attractive.
Which ever way it goes, to reverse the current trend is going to be painful at least in the short term.
Looking at the statistics, the biggest growth has been in the "uncapped categories for partners and dependent children". Other categories have been stable, but this has risen from around 9,000 in 2006 to around 12,500 in 2014/2015; that is over a third higher. Assuming that people are not suddenly bringing in more partners (O.K. there may be an increase in partnered against single) then the big increase is in children. Who are likely to be a big drain on health and education until they become productive. However they are the future!
TL;DR - what exactly is stopping parents coming to be near their children going to achieve? This targets around 3,500 people a year who already have to prove that they are either fully self supporting or have a family who earn enough to support them.
[It might boost the child care industry a bit and make all parents (not just migrants) pay more for child care whilst they work to pay their mortgage?]
At the higher end there is a need for skilled jobs, having been involved in recruiting several positions in last few years, there is a often a dearth of local candidates for skilled IT jobs, and unavoidable need to recruit overseas.
Oct 14th 2016, 5:32 pm
#6
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Re: New quotas - and the market response
Agreed that having a child who earns enough to (theoretically) support you doesn't guarantee that the {litle ****} child will really do this. However it seems harsh to block parents who are self supporting.
Perhaps they will work this out eventually and modify the selection criteria to pick those fit the other two categories.
Not holding my breath, though.
Oct 21st 2016, 1:09 am
#7
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Re: New quotas - and the market response
It's only a 5% tightening target on current record levels.
Also on the economic question this must be looked at on balance. The point of economic measures is to understand and improve quality of life. The question is if higher net GDP growth is a larger benefit than house price inflation, low wages growth etc. On balance I find myself in the very difficult position of having to say the National government have taken a small step in the right direction here.
Also on the economic question this must be looked at on balance. The point of economic measures is to understand and improve quality of life. The question is if higher net GDP growth is a larger benefit than house price inflation, low wages growth etc. On balance I find myself in the very difficult position of having to say the National government have taken a small step in the right direction here.
Oct 21st 2016, 8:18 pm
#8
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Re: New quotas - and the market response
Of course, this is not much help to those following the other two routes: enough income to support yourself or enough capital to support yourself.
Agreed that having a child who earns enough to (theoretically) support you doesn't guarantee that the {litle ****} child will really do this. However it seems harsh to block parents who are self supporting.
Perhaps they will work this out eventually and modify the selection criteria to pick those fit the other two categories.
Not holding my breath, though.
Agreed that having a child who earns enough to (theoretically) support you doesn't guarantee that the {litle ****} child will really do this. However it seems harsh to block parents who are self supporting.
Perhaps they will work this out eventually and modify the selection criteria to pick those fit the other two categories.
Not holding my breath, though.
