BOB BIRRELL Australia’s Skilled Migration Program is not delivering Scarce SkillsMar 16, 2018
As vexations flowing from record high net overseas migration mount, supporters of the permanent entry program have had to dig deeper to defend it.These supporters include the Treasury and the Reserve Bank as well as business and property interests. They say that any major cut to the migration program would put in jeopardy Australia’s 26 years of unbroken nominal economic growth. The Treasury emphasises that Commonwealth taxation revenue would also diminish, putting further pressure on the budget deficit.
Whatever the truth of these assertions, they do not cut much ice with the majority of voters who now think that immigration levels should be reduced. http://tapri.org.au/wp-content/uploads/2016/04/TAPRI-survey-19-Oct-2017-final-3.pdf The Coalition government has had resort to other justifications. The chief one is that Australia’s permanent entry skill program is delivering scarce skills vital to Australia’s economic health. According to the PM, Malcolm Turnbull, it is ‘state of the art’ in this respect. http://tapri.org.au/wp-content/uploads/2016/04/Final-March-8-Australias-skilled-migration-program.pdf
These claims have no substance. This conclusion is based on recent unpublished data on the occupations of those visaed in the skill program. The key findings are:
- The great majority of those visaed in the skill program are professionals, an increasing share of whom hold occupations that are oversupplied. On the other hand, it is delivering a negligible number of construction trade workers. This is despite housing industry claims that continued skilled migration is crucial to supplying the workers needed to provide the housing and infrastructure to accommodate Australia’s booming population.
- You might think that a skill program directed at recruiting scarce skills would prioritise the relevant occupations. That is not the case. In 2010 a Skills Occupation List (SOL) was introduced that made selection conditional on the applicant’s occupation being in national shortage. Since that time this condition has been wound back, to be finally abolished in 2016.
- The SOL has been replaced by a Medium to Long-Term Strategic Skill List (MLTSSL). This makes selection conditional on whether an occupation might be needed in two to ten years’ time. The MLTSSL includes numerous professions that the government’s own Department of Employment has judged to be oversupplied, including accounting and engineering.
As a consequence, most recently arrived skilled migrants cannot find professional jobs. This statement is based on new findings from the 2016 Census on the employment situation of skilled migrants who arrived in Australian over the years 2011-2016 (Table 1).
A huge number (256,504) of overseas born persons aged 25-34 who held degree or above level qualifications at the time of the Census arrived in Australia over these years. The vast majority, 84 per cent, came from Non-English-Speaking-Countries (NESC). The rest, just 16 per cent, came from Main-English-Speaking-Countries (MESC).
Only 24 per cent of the NESC group were employed as professionals as of 2016, compared with 50 per cent of the MESCs and 58 per cent of the same aged Australian-born graduates.
|Table 1: Employment outcomes, persons aged 25-34 years with bachelor or higher degrees by birthplace and time of arrival, Australia 2016|
|Field of study of highest qualification||Managers||Professionals||Other||Not available^||Not
Arrived 2011 – 2016
|Management and Commerce||7||16||43||1||34||100||65,049|
|Engineering & related technologies||5||30||33||1||31||100||32,808|
Arrived 2011 – 2016
|Management and Commerce||22||42||27||1||7||100||8,925|
|Engineering & related technologies||13||60||19||1||8||100||2,824|
Arrived before 2011
|Management and Commerce||13||30||40||1||16||100||104,174|
|Engineering & related technologies||11||47||27||1||14||100||25,056|
Arrived before 2011
|Management and Commerce||24||40||26||1||8||100||9,961|
|Engineering & related technologies||15||63||15||1||6||100||3,188|
|Management and Commerce||22||43||27||1||7||100||114,641|
|Engineering & related technologies||13||66||15||1||6||100||34,478|
|Source: ABS 2016, TableBuilder data set
NESC – Non English speaking countries
MESC – Main English speaking countries (New Zealand, UK, Ireland, USA, Canada and South Africa)
^ Not available includes inadequately described and not stated
* Not applicable relates to those who are unemployed or not in work force
Table excludes around 20,000 degree-qualified persons in the age group who could not be classified by birthplace and/or year of arrival.
Australia is awash with graduates – as a consequence of past migration and growth in domestic university completions. By 2017, 38.5 per cent of Australian residents aged 25-29 held degree level qualifications and 40.3 per cent of those aged 30-34. This is high by international standards.
These findings mean that it is unlikely Australia will need any augmentation of its stock of professionals from migrant sources in the medium term.
The Skill Stream program is deeply flawed. The full report explores its deficiencies. They go far beyond the absence of any mechanism to select skills in short supply. The bottom line, however, is that it is not needed for its proclaimed purpose, that is, to provide employers with scarce skilled workers.
Australia’s employers would hardly notice if it was abolished.
Bob Birrell is the head of The Australian Population Research Institute. The full report, by Bob Birrell, Australia’s Skilled Migration Program: Scarce Skills Not Required (March 2018) is available on the TAPRI website. http://tapri.org.au/wp-content/uploads/2016/04/Final-March-8-Australias-skilled-migration-program.pdf