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Economic Assessment of Reducing Migration in NSW

In October 2018, NSW Premier Gladys Berejiklian called for net overseas migration to New South Wales to be halved, from just over 100,000 people to around 50,000 people annually. The Premier cited high rates of population growth, congestion and insufficient infrastructure to support future growth. Several weeks later, Prime Minister Scott Morrison announced plans to consider a cut Australia’s permanent migration cap by up to 30,000 placements. Following these announcements, AEC was engaged to provide analysis around the economic ramifications of reducing migration to NSW. AEC provided an overview of historic overseas migration and net overseas migration by visa type, a qualitative assessment of the beneficial and adverse impacts of reducing overseas migration to NSW.

The report culminated in a quantitative assessment of reducing overseas migration to NSW by 54,500 people annually for a ten year period from 2020 to 2029 using CGE modelling. The simulations undertaken for this report contained four core drivers for economic change in NSW. These were changes to:

  • Population

  • Education exports

  • Income transfers to foreign students studying in Australia

  • Work force (total number and occupational mix).

Results of the modelling examined the impacts of a reduction inward overseas migration to NSW in terms of lost Gross State Product (GSP), industry output, employment and employee incomes. Impacts on population and demand for dwelling development were also investigated.


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