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War Economy

United States Forces in New Zealand

United States Forces in New Zealand

With the war in the Pacific came the garrisoning in New Zealand of United States forces and the need to build camps and hospitals for them. In June 1942, 17,000 men arrived and there were to be substantial numbers in New Zealand from then until July 1944. Construction work for these allied forces was undertaken by the New Zealand Government using New Zealand labour. The work was an offset to American Lend-Lease supplies reaching New Zealand, but there was nothing to relieve the strain it placed on manpower. Moreover, the United States authorities in New Zealand, in need of men to load and unload vessels, to maintain camps and provide transport and a variety of other services, entered into competition for the already scarce labour supply. United States servicemen on liberty added to the demand for the limited supply of goods and services. With adequate funds and high rates of pay, the visitors were at a considerable advantage. New Zealand page 74 employers and New Zealand consumers found themselves unable to compete. The extra injection of freely available money added to the Government's stabilisation problems, but, from the point of view of the balance of payments, there was considerable advantage to New Zealand in the inflow of foreign exchange to enable United States servicemen to be paid.

In the second half of 1942 there were usually from fifteen to twenty thousand United States servicemen stationed in New Zealand. Then, in the first quarter of 1943 the numbers were built up to over forty thousand, where they remained until a peak of 48,200 was reached in July 1943. There was a substantial reduction in August, but it was November 1943 before the numbers fell below thirty thousand.

Chart 14 shows changes in numbers of United States servicemen in New Zealand.

chart of US troop statistics

Chart 14

page 75

From the military viewpoint, the presence of United States forces on this scale in New Zealand was of strategic significance, and must have reduced considerably the risk of Japanese attack. Indeed it is surprising that New Zealand's own armed forces serving at home continued to outnumber those serving overseas until as late as September 1943.1

From the economic viewpoint, the presence of United States as well as New Zealand armed forces in New Zealand meant so many more persons who made demands on consumer goods and services available in New Zealand without assisting in their production.

Chart 15 shows the numbers of servicemen in New Zealand, including those of both countries.

chart of US troop statistics

Chart 15

page 76

1 See also Chart 13.