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‘Net Overseas Migration’ misunderstood in the housing debate

13 June 20240 comments

Recent hysteria among politicians and media commentators that links the surge in ‘net overseas migration’ with soaring housing costs is misplaced, according to a leading migration academic.

In a recent ‘policy brief’, ANU researcher Professor Alan Gamlen said that the COVID-19 pandemic had skewed the most recent migration statistics.

The Director of the ANU Migration Hub, Professor Gamlen said: “Net Overseas Migration (NOM) is calculated by subtracting overseas departures from overseas arrivals.”

“People often confuse NOM with permanent migration, which is just a small, capped part of NOM. NOM also includes flows the government can’t cap, like people departing and Australians returning home. So, NOM is bigger than just permanent migration,” he said.

“Public discourse has traditionally focused on the smaller permanent migration figures, and people are unused to hearing much about NOM. They are now hearing the larger NOM figures without really knowing what these figures mean, which is causing some misplaced concerns.”

Prof Gamlen said NOM always fluctuated as migrant arrivals and departures changed over time.

He said that the natural fluctuation, NOM was quite stable until the COVID-19 pandemic, adding around 220,000 to Australia’s population per year for at least a decade.

And that without this intake, Australia’s population would rapidly age and shrink, creating workforce shortages and economic decline.

But, during the pandemic NOM spiked downward and then upward, something that had not happened to NOM since World War I.

“When the pandemic subsided, arrivals rebounded to just over 737,000 in the year to June 2023. That’s 16 per cent above where we previously expected them to be by now,” Prof Gamlen said.

“But here’s the thing: the current NOM up-spike is still way smaller than the NOM down-spike that happened during the pandemic. On the whole, we got 352,000 fewer people through net migration than we previously expected we’d have gotten by now,” he said.

“There is a lot of concern amongst politicians, media and the general public, who worry that the NOM surge is inflating Australia’s housing prices. But migration is a small piece of the housing puzzle.

“However, because of the perceived connection between NOM and housing prices, both main political parties are focusing on migration as a battleground issue for the 2025 election campaign.

“Over the past four years there have been way fewer arrivals, way fewer departures, and way less NOM than we previously expected we’d have by this time. We’ve had a lot less migration, not more,” Prof Gamlen said.

Read Prof Gamlen’s brief here: Explaining the 2024 Net Overseas Migration surge – ANU Policy Brief