Last month The Treasury published some new research aimed at providing better information on the population changes in each territorial local authority (TLA) between censuses. At present we only have a census every five years – and in some quarters there seems to be a push to reduce that frequency – and subnational population estimates between censuses have often been pretty poor, only to be updated and revised when the next census results finally appear. At present, the published subnational population numbers are anchored to the 2013 Census, adjusted for estimates of the overseas net migration flow and data on births and deaths. In New Zealand we don’t have to tell some specific government agency when we move house or city.
Except that, as The Treasury observes, in practice we often do end up telling some government agency (or government-funded agency) or other – in fact, are coerced to do so – and the government has collated all that data in a single (anonymised) database. That opens up enormous possibilities to use that data to, for example, update subnational population estimates in a way likely to be more accurate (albeit not very timely). You might worry, as I do, about governments getting their hands on all that data combined, by some mix of coercion and seduction (eg have the slightest accident and you get into the ACC system) and worry that it might be used for ill as much as for good. But, like it or not, the data are there and The Treasury is using them.
This chart from their paper gives you the picture of the data they are using
But my interest is less in the details of how they calculate their estimates, as in some of the bottom line results, and particularly those around estimated internal migration.
There are some interesting snippets. The results suggests that New Zealanders’ rates of internal migration (one TLA to another) have been pretty stable, but that of immigrants has increased quite a lot. The author offers no ideas about why that might have been (and I don’t have any to suggest either).
There is a fascinating picture of Christchurch following the earthquakes, including the continuing losses in recent years to neighbouring Selwyn and Waimakariri.
And then there is Auckland
There was a slight move into Auckland from elsewhere in New Zealand (mostly from Christchurch, see previous chart) in 2011, but otherwise the net flow of New Zealanders has been away from Auckland. In fact, in the final year of the chart, the net outflow of New Zealanders (this is a NZ-born measure) was larger than the natural increase, so that the entire increase in Auckland’s population is (estimated to have been) due to international migration.
Readers with long memories may recall that I touched on the outflow of New Zealanders (as captured in Census data) in an earlier post.
This was the picture from the five years from 2008 to the 2013 Census.
As I observed then, we didn’t know what had happened since 2013. Perhaps things had turned around? But the new Treasury estimates suggest that if anything the outflow – still modest each year – may have accelerated.
We have the data going further back. Here is the extract from the earlier post.
SNZ has compiled this data back as far as the 1986 to 1991 five-yearly period. The last five yearly period in which Auckland experienced a net inflow of people from elsewhere in the country was from 1991 to 1996.
Here is chart which covers the estimated net internal migration to each region for the period 1986 to 2013 (with the two years 2006 to 2008 missing, because they weren’t captured by any of the censuses).
None of this should be very surprising. After all:
- Auckland house prices have become impossibly high,
- Traffic congestion problems, if temporarily relieved now by Waterview, seem continually pressing, and
- The gap between Auckland incomes and those in the rest of the country, never large, has been narrowing.
But it must be an inconvenient truth for boosters of the Auckland story, including bureaucrats in MBIE, the Secretary to the Treasury, assorted past and present ministers (recall John Key on “quality problems”). The people who know Auckland best – the opportunities for themselves and their families – are, at the margin, leaving the place. People in the rest of New Zealand aren’t (net) flocking to the big city. It simply doesn’t seem to offer them better opportunities than staying where they are (or going to Australia).
The latest issue of the London Review of Books turned up in the mail yesterday. In one of the reviews – of a new book by Richard Florida – I found this
The new urban inequality has two distinct and related aspects. First, superstar cities have moved ahead of the nations they’re found in. The trend is clear in the US, where cities like New York have become richer relative to the country as a whole. But it is most pronounced in the UK. In the 1970s and 1980s, London’s GDP per head was around one and a quarter times that of the UK as a whole. Today it’s one and three-quarters.
It isn’t just London or New York. I’ve shown previously a chart looking at GDP per capita in EU countries, looking at the ratio over time of that in the biggest city relative to GDP per capita for the country as a whole. Over this century there has been a clear upward trend.
As for Auckland, in 2000 GDP per head in Auckland was 15 per cent higher than for the country as a whole, but by last year it was only 9 per cent higher. I’ve shown previously (a couple of years ago) this chart of how small the New Zealand gap is between GDP per capita in the biggest city and that for the country as a whole, by comparison with many other advanced countries.
There are, perhaps, some good dimensions to the New Zealand story. We don’t have whole swathes of the country being left behind as the metropolis powers ahead. On the other hand, the metropolis isn’t powering ahead at all – just getting more and more people, in a city which is underperforming a country with weak (almost non-existent in recent years) productivity growth.
It is well past time for a rethink, and for our politicians and officials to start focusing on the specifics of the New Zealand experience. In terms of economic success, Auckland bears not the slightest resemblance to London or New York (or Paris, or perhaps even Bratislava). And yet the growth strategy (perhaps flattering it to use the term “strategy”) has seemed to rest almost entirely on a wishful belief that if only we tried really hard, and poured more and more people into Auckland, it just might be. But one of the lessons of economic geography is that location matters. Ours – Auckland’s – is exceeedingly unpropitious.
That LRB review I mentioned earlier notes that trends in recent decades have turned out to be very good for “established global cities in particular”, in ways that few anticipated. That particular discussion ends thus
The business districts of San Francisco, New York, and London are ludicrously prodigious. The Borough of Westminster produces as much wealth as all of Wales.
I can’t vouch for that final statistic, but it does leave one thinking that it is more likely that Auckland is a Cardiff or (moving north) Glasgow, than that it is a coming London or New York.