It is claimed that the number of expatriates who are now returning to their home country, New Zealand, are responsible for a 7.3% unemployment rate in the country.
Concerns have been raised in New Zealand that the country will be slow to emerge from the recent recession amid claims that the unemployment rate in the country is at an all time high, with approximately 168,000 currently being out of work. Figures released by the Household Labor Force Survey by Statistics New Zealand (SNZ) last Thursday show that unemployment jumped from 6.5 percent to 7.3 percent in the final three months of last year. This constitutes the highest unemployment rate since 1993.
The labor force participation rate, which measures the proportion of people actively looking for work, increased slightly by 0.1 percentage point to 68.1 percent during the latest quarter. Employment itself also shrank 0.1 percent to 2.15 million, while hours worked also declined. Unemployed citizens are highest amongst those groups that have previously struggled during the recession; people below the age of 24, Maori, and Pacific Islanders. In addition, men have been hit more than women, with unemployment raising at a faster rate for this gender primarily due to the fact that industries that are traditionally dominated by men, such as construction and manufacturing, have suffered the most during New Zealand’s recession.
The raise in unemployment exceeds all previous forecasts from economists, with this being blamed on a rise in new entrants to the workforce. Paula Bennett, the social development and employment minister, confirmed this: “Net migration is part of this picture. New Zealanders are coming home and staying home, choosing to ride out a global recession in New Zealand,” she said.
Such a raise is being attributed on many factors. Fewer New Zealand citizens, it appears, are leaving the country to search for opportunities overseas. In addition to this, those that have previously lived and worked abroad, are now returning home, with the number repatriates in excess of 26,000 in 2009; a figure that’s 11% higher than the average.
At present, it is believed that almost 600,000 New Zealand citizens live abroad as expatriates. One returning expatriate, who has lived in the UK for over 10 years commented on the issues he has faced since returning to New Zealand: “A lot of expats who made money overseas are returning home, (…) You can make money down here. I’m still trying to find business development funding but I’m optimistic about the opportunities in the Asia Pacific basin.”
Chris Tennent-Brown, an economist at Commonwealth Bank of Australia, described the unemployment figures as disappointing, especially compared with Australia’s 5.6% unemployment rate: “Anything with a seven in front of it makes us look a lot closer to countries like the UK and other struggling economies rather than Australia,” he said. He added that he believed the majority of New Zealander’s are returning home as a result of the global economic picture.
“They are not coming home because it’s a buoyant market but it’s not as bad as the UK and the US,” he said. ”In those countries unemployment is higher and it’s also much more expensive to live.” He did add, however, that he believes that New Zealanders will return overseas once the global economy improved.
The Department of Labor expects unemployment to peak in the middle of this year.