TEMPORARY MIGRATION

Highlights

• The number of people issued work permits in New Zealand grew 13 percent between 2006/07 and 2007/08.
• Migrants' work experience in New Zealand before residence is positively linked to their employment outcomes after gaining residence. Most residence approvals in 2007/08 had previously held a temporary permit (81 percent of 46,077 approvals).
• An increasing number of international students gain permanent residence in New Zealand after completing their studies. These students offer employers New Zealand qualifications and are already partially settled in New Zealand.

Introduction

Temporary workers and students make an important contribution to New Zealand's economy. People on work permits are an important source of labour and skills, offering skills and experience that New Zealand employers need, even in an economic downturn.^[44] Many work permit holders will eventually become permanent residents, and specific work permit policies help to promote this transition.

International students contribute to New Zealand's economic development through foreign exchange earnings, by promoting international links, and by participating in the New Zealand work force after their study. In 2004, international education was worth an estimated $2.2 billion to the New Zealand economy.^[45] In addition, an increasing number of international students gain permanent residence in New Zealand after completing their studies. These students can offer employers New Zealand qualifications and are already partially settled in New Zealand.

This chapter describes the trends in the number of people coming to New Zealand on temporary student or work permits.^[46] Table D1 in Appendix D shows the number of people issued work and student permits by source country for 2007/08.

Work permits

The objective of work permit policies is to contribute to developing New Zealand's capability base by allowing New Zealand employers to access skills and knowledge from around the world. Work permit policy allows people to enter New Zealand for a variety of work-related purposes. It also aims to ensure that the employment of temporary migrants does not undermine the wages and conditions of New Zealand workers. Specific policies allow employers to recruit temporary workers from overseas to meet particular or seasonal skill needs that cannot be met from within New Zealand. Other policies allow family members of migrants to participate in the labour market and young people (18-30 years) to participate through Working Holiday Schemes. Table E1 in Appendix E summarises the work permit criteria.

The number of people issued work permits grew about 18 percent on average over the decade to 2007/08. In 2007/08, 130,462 individuals were issued work permits, 13 percent more than in 2006/07, although the rate of increase is slightly less than the 16 percent recorded from 2005/06 to 2006/07. Figure 5.1 shows the growth in the number of people issued work permits since 1997/98.

Figure 5.1 Number of people issued work permits, 1997/98-2007/08

Data table for Figure 5.1

Many factors have contributed to the growth in the number of work permits issued. These factors include the expansion of Working Holiday Schemes, the introduction of new policies such as the Work to Residence and Study to Work Policies, and increasing numbers of work permits issued through the Partnership Policy. Much of the increase in work permits issued in 2007/08 came from partners of temporary workers or students, seasonal workers, and people who took part in specific purposes or events.^[47] Figure 5.2 compares the number of work permits issued by broad type in 2006/07 and 2007/08.

Figure 5.2 Comparison of work permit types, 2006/07 and 2007/08

Data table for Figure 5.2

Note: the percentages show the proportion of all work permits for each work permit type by fiscal year.

Nationality of work permit holders

In 2007/08, the United Kingdom provided the most work permit holders in New Zealand with more than 20,000 work permit holders (16 percent), followed by China (11 percent). The number of Chinese people granted work permits has increased significantly to almost 15,000 in 2007/08. Much of this growth stems from the introduction of the Study to Work Policy in 2005, whereby international students may apply for work permits once they have completed their New Zealand qualification. In 2007/08, 67 percent of all graduate job search permits (3,445 out of 5,133) were issued to Chinese graduates. The Philippines and India also showed strong growth as sources of work permit holders, while the number from Japan steadily declined. Figure 5.3 shows work permit holders by nationality in 2006/07 and 2007/08.

Figure 5.3 Nationality of work permit holders, 2006/07 and 2007/08

Data table for Figure 5.3

Note: the percentages show the proportion of all work permit holders by nationality and fiscal year.

Of the main source countries for work permit holders, the Philippines had the largest increase (60 percent) from 2006/07 to 2007/08, followed by Fiji and India (both increased 26 percent). Table F1 in Appendix F shows work permit holders by nationality since 1998/99.

Labour market-tested work permits

Labour market-tested work permits allow New Zealand employers to recruit temporary workers from overseas to meet shortages that cannot be met from within New Zealand, while protecting employment opportunities for New Zealand citizens and residents. These permits consist of the essential skills permit (some of which are issued under approvals in principle), and permits issued under some business policies and the seasonal work permit policy. These permits also cover workers in specialist skill areas such as machinery installers and Japanese interpreters.^[48]

In 2007/08, 41,420 people were issued with labour market-tested work permits, a 21 percent increase from 2006/07.^[49] The United Kingdom has remained the largest source country with 12 percent of all labour market-tested work permits in 2007/08. However, the Philippines had the largest relative increase in people issued with labour market-tested work permits from 2006/07 to 2007/08. The Philippines almost doubled its number of work permit holders to 3,416, becoming the second largest source country (8 percent of all people issued with labour market-tested work permits in 2007/08). Figure 5.4 shows the number of labour market-tested work permit holders by nationality in 2006/07 and 2007/08.

Figure 5.4 Nationality of labour market-tested work permit holders, 2006/07 and 2007/08

Data table for Figure 5.4

Note: the percentages show the proportion of all labour market-tested work permit holders by nationality and fiscal year.

For information about the ratio of females to males by age and nationality for work permit holders approved in 2007/08, see Table G1 in Appendix G.

Working Holiday Schemes

Working Holiday Schemes allow young people (18-30 years) to spend 12 months (or two years for United Kingdom working holidaymakers) in New Zealand and undertake work of a temporary nature.^[50] In July 2005, policy changes increased the number of places available in many schemes, eased the work restrictions in some schemes, and introduced online processing for most applications. New Zealand has Working Holiday Schemes with 27 countries and up to 50,000 places are available.^[51]

The number of young people coming to New Zealand as working holidaymakers has increased steadily over the years. In 2007/08, 34,890 people were approved through the various Working Holiday Schemes. The greatest numbers came from the United Kingdom and Germany, contributing 27 percent and 17 percent of all working holidaymakers respectively. Table 5.1 shows the number of people issued with working holidaymaker permits from selected countries in 2007/08.

Table 5.1 Number of people approved work permits under Working Holiday Schemes, 2007/08

Working holiday schemes	Annual places available in the scheme	Number of working holidaymakers 2007/08
Argentina	1,000	988
Belgium	2,000	214
Canada	2,000	1,444
Chile	1,000	1,039
Czech Republic	1,000	963
Denmark	2,000	235
Estonia	100	51
Finland	2,000	227
France	5,000	1,883
Germany	Unlimited	5,976
Hong Kong	200	263
Ireland	2,800	1,919
Italy	1,000	369
Japan	Unlimited	2,352
Malaysia	1,150	813
Malta	50	5
Mexico	200	62
Netherlands	Unlimited	701
Norway	Unlimited	61
Singapore	200	37
South Korea	1,500	1,892
Sweden	Unlimited	601
Taiwan	600	615
Thailand	100	90
United Kingdom	Unlimited	9,462
United States	5,000	2,189
Uruguay	200	193
Working holiday schemes extension		246
Total		34,890

Across the Working Holiday Schemes, 52 percent of permits were issued to women. The number of work permits issued to women from Japan, Taiwan, Thailand, and Hong Kong was more than double the number issued to men from the same countries.

A large proportion (46 percent) of working holidaymakers were aged 21-25 years.

Figure 5.5 shows the age and gender distribution of working holidaymakers in 2007/08.

Figure 5.5 Age and gender of working holidaymakers, 2007/08

Data table for Figure 5.5

Student permits

International education is estimated to contribute more than $2 billion annually in foreign exchange to New Zealand.^[52] In addition to the financial gain from student migration, host countries stand to benefit from the improvement of political and economic relations with the source countries.^[53] In New Zealand, international students can also play an important role in the labour market through their labour participation post-study, particularly if they are qualified and gain employment in areas with skill shortages.

International students planning to attend courses that last more than three months must apply for a student visa before travelling to New Zealand. Students from a visa-free country may apply for a student permit in New Zealand. For courses of a three-month or shorter duration, non-New Zealand residents are not required to obtain a student visa or permit, though they will still require a temporary permit to be in New Zealand.

In July 2005, several policy changes came into effect, some of which were enhanced in November 2007. These changes are listed below (and see Appendix A). The aim of the changes is to make New Zealand a more competitive destination for international students by easing the work restrictions for students and their partners.

• International students who graduate with a qualification eligible for points under the Skilled Migrant Category (SMC) are eligible for a six-month open work permit (the graduate job search permit). The duration of this permit was increased to 12 months from November 2007.
• Some students are eligible to apply for a two-year post-study work permit to obtain practical work experience relevant to their qualification. From November 2007, this permit increased the duration to three years for graduates who require three years' work experience in New Zealand to qualify for membership or registration with professional bodies.
• The pool of students eligible to work part time while studying was expanded to include Year 12 and Year 13 school students and some English language students, provided certain conditions, including English language standards, are met.
• Eligible students may apply to work for up to 20 hours a week during term (the previous limit was 15 hours).
• Anyone undertaking a course of 12 months' or longer duration may apply to work full time over the summer holidays.
• Partners of students studying in areas with skill shortages and partners of postgraduate students may apply for an open work permit that is valid for the duration of the student's course of study.

Student approval numbers

New Zealand's international student population has been declining since 2002/03 but increased in 2007/08. However, the number of students coming from China (New Zealand's main source country) is still in decline. Figure 5.6 shows the growth in international student numbers since 1997/98.

Figure 5.6 Number of principal applicants granted student permits, 1997/98-2007/08

Data table for Figure 5.6

In 2007/08, 69,193 people from outside New Zealand were approved to study in New Zealand. This was a 3 percent increase from 2006/07. The number of student permits approved from China decreased by 3,861 over the same period, but this reduction was offset by more permits from other source countries. Table H1 in Appendix H shows the top source countries of people approved a student permit since 1998/99.

In 2007/08, China is still the major source country for international students, accounting for 24 percent of those issued a student permit, followed by South Korea (16 percent). India replaced Japan as the third-highest source for international students in 2007/08, almost doubling its number of international students to 8 percent.

Students approved offshore

The number of international students approved offshore for a student visa is a partial indicator of the number of new students coming to study in New Zealand. Offshore approval numbers decreased steadily from 2001/02, but since 2004/05 have increased. In 2007/08, there were 27,025 offshore student approvals, which was a 21 percent increase from 2006/07.

India recorded the largest relative increase in offshore student approvals from 2006/07 to 2007/08, by more than doubling the number of approvals to 3,889. India has overtaken China as the largest source country for offshore student approvals. Figure 5.7 shows the number of students approved offshore among the top seven source countries.

Figure 5.7 Number of students approved offshore for the top seven source countries, 2006/07 and 2007/08

Data table for Figure 5.7

Note: the percentages show the proportion of all students approved offshore by country and fiscal year.

Age and gender of international students

In 2007/08, more males than females were issued a student permit, although the ratio varies considerably among source countries. India had the lowest proportion of females compared with males. Females outnumbered males from Japan and the United States. Table 5.2 details international students' gender ratio by age group and nationality in 2007/08. See Table I1 in Appendix I for more information.

Table 5.2 Ratio of females to males by age group and source country for student approvals, 2007/08

Source country	Age group (years)				All ages
	0-15	16-19	20-29	30 and over
China	0.79	0.82	0.79	1.51	0.82
India	0.85	0.21	0.25	0.57	0.30
Japan	1.58	1.82	1.26	1.34	1.56
South Korea	0.84	0.93	1.03	1.07	0.93
United States	1.19	1.71	1.30	0.96	1.33
Other	0.97	0.93	0.84	0.98	0.92
Overall ratio	0.95	0.91	0.77	1.02	0.86
Total number of approvals	17,778*	15,579	31,187	4,648	69,192*

Note

* Excludes one person of unspecified gender.

Student transitions to work

Internationally, foreign students have become an increasingly important target of immigration policies that aim to attract and retain talented migrants.^[54] For many students, the prospect of gaining residence in the host country plays a role in their decision to study abroad.^[55] The New Zealand student policy changes introduced from July 2005 were intended to facilitate the transition from study to work and residence by creating more opportunities for students to work while studying and allowing them greater access to work permits after study.

In 2007/08, 5,133 students were issued a graduate job search work permit,^[56] a 15 percent increase from 2006/07. Of the 5,133 students, 67 percent were from China and 14 percent were from India.

Some students were issued a two-year work permit to obtain practical experience relevant to their course or qualification.^[57] Of the 3,528 students issued a two-year work permit, 69 percent were from China and 13 percent were from India.

Transitions from temporary permits to permanent residence

Linking temporary immigration policy with residence policy can have significant benefits for both migrants and New Zealand. Having participated in New Zealand society, temporary workers and students are likely to settle well and contribute to the country. Research shows a positive link between migrants' work experience in New Zealand before residence and their employment outcomes after gaining residence.^[58] This section examines the cohort of people approved for permanent residence in 2007/08 and identifies the previous temporary permits these migrants held.

In 2007/08, 46,077 people were approved for residence, 81 percent of whom previously held a temporary permit (90 percent of principal applicants and 71 percent of secondary applicants). Across the four residence streams, the Skilled/Business Stream had the highest rate of applicants with a previous temporary permit (85 percent), followed by the combined Uncapped Family Sponsored and Parent Sibling Adult Child Streams (83 percent), then the International/Humanitarian Stream (46 percent).

Most recently held temporary permit

The most recently held temporary permit was identified for migrants who had held a visitor, student, or work permit before residence. Three-quarters of principal applicants had recently held temporary work permits. Secondary applicants were equally distributed across the three types of temporary permit (visitor, work, and student).

Table 5.3 highlights the differences between principal and secondary applicants, as well as the various streams and types of temporary permit. Many secondary applicants were dependent children, which explains the much lower proportion of secondary applicants who held a work permit before residence compared with principal applicants.

Table 5.3 Type of temporary permit most recently held by people granted permanent residence, 2007/08

New Zealand Programme Residence stream	Applicant type	Number of residence approvals 2007/08	Percentage who held temporary permit (%)*	Most recent temporary permit (row %)
				Student	Visitor	Work
Skilled/ Business	Principal	12,014	94	2	11	87
	Secondary	15,289	78	34	28	39
	Subtotal	27,303	85	18	20	62
Uncapped Family Sponsored and Parent Sibling Adult Child	Principal	11,202	89	4	35	61
	Secondary	3,434	63	24	70	6
	Subtotal	14,636	83	8	41	52
International/ Humanitarian	Principal	1,505	65	2	32	65
	Secondary	2,633	35	31	47	22
	Subtotal	4,138	46	16	39	44
Total	Principal	24,721	90	3	23	75
	Secondary	21,356	71	32	35	33
	Total	46,077	81	9	22	69

Note

* The proportion of approvals who held a temporary permit at some point in 2007/08.

For more information about residence approvals by NZRP stream in 2007/08, see Table J1 in Appendix J.

---