Historic population drop, labor shortage

For the first time in its history, New Caledonia is seeing its population decrease, with important consequences for certain sectors of activity, in particular due to departures from the territory due to institutional instability and the Covid-19 crisis.

The population of the South Pacific archipelago fell below 270,000 inhabitants on January 1, declining for two consecutive years (-330 people in 2020 and -1,050 in 2021), according to the Institute of Statistics and Economic Studies (Isee) of New Caledonia, which ensures that it is a totally unprecedented situation for the territory.

Departures are the main cause of this decrease: 2,999 in 2021 and 2,782 the previous year. As a result, net migration no longer compensates for the drop in the birth rate, which began in the 1980s. A dynamic already observed during the 2019 census, which reported 13,000 departures since the previous census in 2014.

“We have lost 18,000 people since 2014”

Fears about the future of the territory after three self-determination referendums that have not yet resulted in a new status and the closure of borders for two years due to the global health crisis explain this phenomenon, according to Isee.

This drop is causing serious concern in the economic community. “We have lost 18,000 people since 2014”, calculates Thibaut Martelin, president of the Medef economic-fiscal commission, “and the phenomenon is accelerating”. The employers estimate the cost of these departures in 2021 at 30,000 million Pacific francs (252 million euros), mainly from the qualified middle classes, or 3% of GDP. With also dire consequences on social accounts that are already in the red.

The Medef, which calls for “emergency economic recovery measures”, believes that the financing of social accounts should be extended to taxes and lower social charges on wages. A reform that would have the double benefit of strengthening the Social Security financing system and “restoring the attractiveness of New Caledonia, by allowing wage increases of up to 15%,” according to Martelin.

recruiting problems

Abandoned by the powers, the territory must face a new competition, between French regions, to hire certain professionals whose shortage is national. Thus, while until now New Caledonia, with its high salaries and preserved living environment, recruited medical and paramedical personnel without difficulty, today entire services are forced to close.

At the Kuindo-Magnin clinic in Nouméa, 30 surgical and internal medicine beds are empty due to a lack of nurses. Outside of Greater Noumea, some clinics are no longer able to handle emergencies, while the nearest hospital is sometimes several hundred kilometers away. To remedy the situation, the Loyalty Islands province has teamed up with Bordeaux University Hospital to provide six hospital interns and allow emergency reopening.

negative GDP?

In all sectors, the shortage of personnel is such that a hypothetical resumption of economic activity would be immediately hampered by the lack of qualified labor, according to several employer representatives interviewed by AFP. “2022 GDP will end slightly negative, as has been the case for three years,” says the IEOM, the institute responsible for France’s foreign currency issuance.

The real estate sector, however, gives hope, if not of recovery, at least of recovery: “We observe in the 1st quarter of 2022 an increase of 26% in real estate transactions”, underlines Olivier Fagnot, director of Isee who publishes on Thursday its annual industry survey.

An improvement that comes after a catastrophic year 2021 where transactions fell by 11.2% compared to the previous year, reaching its lowest level since 2014. An improvement that concerns only the previous one. “The new has become anecdotal, 90% less than in 2015”, according to Isee.

The third self-determination referendum organized on December 12, 2021 gave victory to the “no”, but was marked by the boycott of the separatists, who had asked for its postponement due to the Covid-19 pandemic.

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