Coalition launches 457 visa class war

ScreenHunter_1608 Mar. 12 08.54

By Leith van Onselen

I noted a few weeks back how the Abbott Government had announced a review of 457 visas for ­temporary foreign skilled workers, which looked as if it would unwind conditions enacted by the former Labor Government, such as the requirement that a job must be advertised locally before a 457 visa is issued.

Now Fairfax is reporting that the Abbott Government has quietly reopened a visa loophole that will allow employers to hire an unlimited number of foreign workers under a temporary working visa, potentially opening the system to widespread rorting:

In the Coalition’s bid to remove all ”red tape” from the 457 skilled migrant visa, employers will not be penalised or scrutinised if they hire more foreign staff than they applied for.

Before the loophole was closed in 2013 by the Labor government, companies in the mining, construction and IT industries were knowingly hiring hundreds more foreign workers than they had applied for…

A discussion paper in 2012 also found there was no restriction to the number of 457 workers a company could nominate once a sponsorship is approved.

ScreenHunter_1609 Mar. 12 09.00

The Coalition’s liberalisation of 457 visas is curious on a number of levels.

First, as noted in the Department of Employment’s latest labour shortages report, “skill shortages continued to abate” and employers in 2013 “generally filled their vacancies with ease and had large fields of applicants from whom to choose” (see next chart).

ScreenHunter_1610 Mar. 12 09.06

Second, unemployment is at the highest level in 10 years and likely to deteriorate further. In addition, the labour force participation rate is falling (suggesting hidden employment), and there is substantial under-employment (see below charts).

ScreenHunter_1611 Mar. 12 09.19
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With the mining investment boom set to unwind over the next few years, along with the closure of the local car industry, labour surpluses are only likely to increase.

Clearly, based on the data, there are few genuine skills shortages, undermining the need for 457 visas at all.

Therefore, the Coalition’s loosening of 457 visa requirements looks like another measure aimed squarely at undermining local workers’ pay and conditions, while at the same time keeping the throttle on population growth and capital’s share of profits.

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Comments

  1. sydboy007MEMBER

    Clive and Gina must be laughing all the way to the bank with this one

    How you can argue ensuring a job is advertised and offered to a local over imported labour is an onerous corruption is beyond me.

    Abbott and his financial backers won’t be happy till most of us are on minimum wage and working 6 days a week

    • Yes, this is the plan. Libs despise the working class but is not above using cheap imported labour against the community to achieve its goal. Sales of existing homes to Temp visa holders about to accelerate. Middle-class collapse is the agenda.

      • The temp visa holders will not be buying housing. They’re here to pay rent. They have no choice. Forced to pay the asking price and go into shared accommodation. They cannot afford to resign, they cannot easily switch employer they are the perfect indentured worker.

    • Why add Clive to this?

      Clive is notorious for paying high wages.

      he doesn’t want to own everything, he wants to be the one in charge, and from that he reckons we will all earn a motza.

      Gina is the one who wants to own everything.

    • To be fair, the worst 457 rorters are not Clive and Gina. As per the stats, it is the hotel/restaurant/cafe crowd and the IT industry.

    • I am all for temporary jobs for a temporary mining boom. The problem is many of these workers will gain permanent residency and when the boom is over they will either end up on the dole or force someone else to be on the dole.

    • It’s ridiculous to solely blame the Libs.

      Labor cut down on itself regarding 457s before the election, and of course house prices rose about 20-30% under their watch.

      At least the Libs won’t declare you public enemy number 1 for making $100k and declaring you rich and someone to tax the hell out of.

      • drsmithyMEMBER

        At least the Libs won’t declare you public enemy number 1 for making $100k and declaring you rich and someone to tax the hell out of.

        I must have missed when that happened, have you got a quote ?

  2. Utter disgrace. Another bird flip from government. 457’s are certainly NOT needed in the Melbourne IT industry.

    • “Gina’s new career as the LNP Cabinet room adviser seems to be paying off.”

      Well if the iron ore and coal prices drop too much she might need the work!

      • General Disarray

        Why would she want to work when she can get a handout?

        She’s already getting a handout for not working. It’s the royalty/entitlement she receives from RIO.

  3. General Disarray

    This is just a healthy plutocracy at work. Move along plebs – no soup for you!

  4. They want higher unemployment, its that simple. Lets not confuse the issue.

    They want to put wage earners on the back foot, force them to accept less, work more, ask fewer questions.

    They want a rich cabal to wash over the country to enrich their class further by bidding up the value of their supply-constricted assets, just as they devalue the worth and dignity of labour by ramping up supply / slashing support services.

    Most Australians thought that when they were electing this group of rabid ideologues they’d be getting something akin to Howard’s mob.

    But the economic challenges we face have opened up the shock-space for Abbott to re-mould the economic and political culture of the country according to his delusions.

    And Labor is all of the above, minus an ideological compass.

    So worse.

    • Most Australians thought that when they were electing this group of rabid ideologues they’d be getting something akin to Howard’s mob

      They are the same, Howard was more upstream.

      Hignsight shows things more clearly.

      Looking back at the state of the economy in the mid 90’s, after all of Hawke-Keatings reforms, one can only look in awe.

      High wages, solid safety net for only those that needed it, exporter sectors the most diverse they’ve ever been in our history.

      It takes a lot of mean spirit to unwind it. Now sure, the libs have that mean spirit in droves, but they can’t unwind it all at once, it takes time.

      This is essentially the Howard governments 5th term.

      Onwards an upwards to further evil.

      We deserve this you know.

  5. Same old, same old. Another day and yet another example of how the people meant to be managing the country in the best interests of all are only doing what works for them.

    Many of us who are employees have the importance of “duty of care” preached to us. Where is that of the political class?

  6. Janet, Greg, Judith, Gerard, I’d like you to meet you new replacements. See Rupert can get Indian right wing journos like Arun, Ashok, Tavleen and Kanchan for a fraction of the cost to employ than you lot. Lets face it; a jounos a journo. No hard feelings eh.

  7. This what you all voted for. I say if we keep the ABC we populate it entirely with 457s from China. Lisa Wilkinson should definitely be replaced by an Indian.

    • India should start training up some more CEOs, business people and economics,we could really use some downward pressure on wages there! On a serious note, outsourcing some of our business commentary could only be a good thing! We’re really not being served well in Australia.

  8. IMHO 457 visa are essential, unfortunately Australia has painted itself into a corner where Importing labor is the only logical path forward for most businesses.

    From my own experience it was impossible to find the skilled engineers I needed within Australia. I actually tried to interest many IT experts to retrain and become control systems programmers, most told me I was crazy ….why would I do that? its a dead end job….

    There we have it, those jobs (training/knowledge) that are essential if Australia is to return to being a productive labor force are “dead-end”.

    I realize that my focus on the necessity for Australia to redevelop a globally competitive labor force is considered as a “race-to-the-bottom” philosophy but it does not have to be that way, productivity is about more than widget per hour. Real Productivity is about leveraging natural advantages. An example of this is the Aluminium refineries located in Victoria. These industries have value because of Vic’s abundant brown coal reserves and the VERY cheap electricity that’s made possible by collocating power generation with brown coal mines. Clearly, in a world obsessed with Global warming, Aluminium refining an industry of the past. Our fathers and grandfathers identified this advantage and created an industry that capitalized on the advantage, it’s our turn now!

    BTW it all starts with a productive labor force and today that means 457’s

    • dumb_non_economist

      CB,

      I didn’t think the 457 argument here was about skills that aren’t present in Australia, but that those that are and 457s being used to undermine pay and conditions

    • At MB we agree with the need to improve competitiveness and that labour must bear its share qof the adjustment.

      But shipping in coolies is very obviously not the right way to go about it. It will sow division, fatten the purses of those few least in need of it and, frankly, joepardise the entire project.

      It should be done via real wage deflation in steps over years.

      Short-sighted, CB. Killing the middle class doesn’t help in the end, as you’re native nation shows.

      • I’m short sighted, that’s priceless.
        Today Australians, measures their wealth in existing IP’s / homes purchased at inflated prices, yet I’m short sighted for suggesting that true wealth should be measured by a societies ability to efficiently create items that have an export value.

        I didn’t say that 457’s should be used to bring in cheap coolies in as kitchen hands BUT I did say they’re essential to any advanced manufacturing plans that anyone else might have. So any restrictive changes to the 457 visa should be properly considered and not simply a knee jerk reaction.

        as you’re native nation shows.
        I’m confused…or more likely you’re confused…. I’m fifth generation Australian, North shore born’n’bred

    • From my own experience it was impossible to find the skilled engineers I needed within Australia. I actually tried to interest many IT experts to retrain…

      This, I think, goes to the crux of the problem. These days it seems like employers don’t look for good people, instead they look for a bag of skills walking around in a human body, ready to “hit the ground running” with little input from the employer.

      And employees are expected to acquire these skills entirely at their own expense, with no guarantee that the skills will still be relevant when they complete the training.

      OK, so maybe you did approach some “IT experts”, but for them maybe it would have been a step backwards, or at least a step sideways into a culdersac. I’m sure there are enough bright young sparks with less experience that would jump at the oppurnity. You might have to be a bit more patient before they deliver the results, but you’d have the opportunity to guide their development in the directions that you felt were important.

    • Is it possible they were correct – control systems programming is a dead end?
      My own experience in engineering is that any sort of technical prowess in Australia is a dead end – after 5-10 years you hit a wall, and need to abandon engineering to become some sort of manager if you want to continue to in your career. Which, in my book, is odd, because a lot of engineers aren’t really people people, so ex-engineer managers don’t have a natural advantage.

      Anyway, to me understanding how little valued technical knowledge is in Australia, and how to increase employers’ appreciation for technical skills is fundamental to maintaining those skills in Australia. Otherwise, when Mr Abbott succeeds in depressing Australian wages, the people you brought in on 457s will move on to the next country where the wages are higher – and it’s possible to afford a house.

    • Why would you, or others like you, expect a production line of ready made engineers for your niche?

      How much investment did you and those liek you make towards that?

      • Well lets see,
        I spent 30 years learning/training/becoming one of the very best practitioners in my field. In the process I accumulated capital which I was willing to invest in Australia. I bought with me customers, contacts and a network of skilled professionals that respected my ability to spot and profitably leverage business opportunities.

        As I said I didn’t expect to find capable production engineers, I wanted to work with IT professionals and develop their control systems skills, I’d have them working side by side with the best in the world creating a world class business, yet to my surprise they rejected me, apparently I was the one that was not bringing long term value to the table. I was the one expecting them to learn already obsolete skills…

        .hmmm on reflection I guess you’re right I shouldn’t have expected any local buy-in after all I didn’t even own a single Aussie house not even one IP, so nothing I believed in could possible be important.

      • Whoa, I’m making a query in a secular sense.

        Well lets see,
        I spent 30 years learning/training/becoming one of the very best practitioners in my field. In the process I accumulated capital which I was willing to invest in Australia. I bought with me customers, contacts and a network of skilled professionals that respected my ability to spot and profitably leverage business opportunities.

        I understand that side, however that doesn’t answer

        it was impossible to find the skilled engineers I needed within Australia

        It was impossible to find wordpress programmers 20 years ago too.

        An investment has to be made for them to exist.

        Now I understand lack of perfect fit, so you went broader, as you say…

        As I said I didn’t expect to find capable production engineers, I wanted to work with IT professionals and develop their control systems skills, I’d have them working side by side with the best in the world creating a world class business, yet to my surprise they rejected me, apparently I was the one that was not bringing long term value to the table. I was the one expecting them to learn already obsolete skills…

        That sounds like lack of incentives. Those (lack of) incentives….

        I guess you’re right I shouldn’t have expected any local buy-in after all I didn’t even own a single Aussie house not even one IP, so nothing I believed in could possible be important.

        may not be your fault, considering the distortions in the economy that perversely incentivise other areas??

        It wou,ld be a good starting point.

        So the real answer here is not a lack of, per se, but perverse incentives.

        457 visas provide answer to ‘lack of’ but that doesnt necessarily need to be addressed, and do nothing to answer perverse incentives. in fact they are more likely to embed them.

        That my friend, and you are very much valued, is what I was trying to highlight.

    • From my own experience it was impossible to find the skilled engineers I needed within Australia. I actually tried to interest many IT experts to retrain and become control systems programmers, most told me I was crazy ….why would I do that? its a dead end job….

      I’d assume their point is that sort of work has, historically, been the first to offshore when the employer decides they need to improve their bottom line.

      Their concerns seem pretty reasonable to me. I imagine you would have to do some serious work to reassure them why retraining into a job that would be easily picked up and moved to India like so many have in the past is a good career move.

      • @RP
        Truth is I cancelled all my Australian investment plans when the capital I was promised got reallocated to Sydney RE. I wasn’t prepared to go it alone because that would be fool hardy.

        Now my “investors” made a small fortune on the recent pop in Sydney RE and are now more convinced than ever that RE is the only REAL investment everything else runs a very distant second….and who can blame them.

        I’d suggest you do the rounds of high net worth individuals in Sydney and see if you can find a single person that believes in anything other than Sydney RE naturally supplemented with some mining stocks because we all need some dividends.

      • @CB

        As you say, who can blame them. To get behind your business, they would have had to expend non-trivial effort understanding it…why bother when housing always goes up?

        To be fair to your potential employees – maybe they had prior experience or knowledge of Australian investors?

      • Truth is I cancelled all my Australian investment plans when the capital I was promised got reallocated to Sydney RE. I wasn’t prepared to go it alone because that would be fool hardy.

        I empathise completely. However this is another point away from 457’s and access to skills, especially in the absence of perverse incentives.

        Now my “investors” made a small fortune on the recent pop in Sydney RE and are now more convinced than ever that RE is the only REAL investment everything else runs a very distant second….and who can blame them.

        Ultimately, that depends on their financial literacy.

        However you’ve moved to Texas and I view that as a superior outcome.

        Your emotion tied up in this appears to be towards a bond to “Australia”

        I understand it, it is consuming my energy as I endeavour to break it.

        But this country doesn’t deserve what you want and can offer it.

        I’d suggest you do the rounds of high net worth individuals in Sydney and see if you can find a single person that believes in anything other than Sydney RE naturally supplemented with some mining stocks because we all need some dividends.

        I know the circumstances of many HNW individuals in Perth, they’re not too dissimilar.

        I know what exists out there, I know of the disincentives, I know of the smugness and the aversion to acknowledging the train wreck coming.

        But that’s not related to 457’s necessary to overcome a ‘skills shortage’

  9. Sometimes I think australians don’t know how good we have it and how easy we can lose it if we don’t stand up for what is fair.

    I don’t want to be labelled a “leftie” or “unionist” for this. I am right in the middle
    between left and right. I am a strong believer that capitalism with all its faults it is the best way to organise a society that we have collectively come up with, but we always need to strive for that balance.

    The US economy was much healthier when wealth was better distributed, then they got sold the “trickle down” and “user pays” concepts and I don’t see them going back to their former glory anytime soon.

    I come from a latin american country, were wealth is not evenly distributed.
    Sure the rich still have a great life, and they pay less taxes, but they do live in a society were they have to worry about some social unrest, strikes, insecurity, they end up spending money on alarms/security devices/private security, so I am not sure if it is worth it. They can’t even “enjoy” their wealth the same way wealthy people do in Australia.

    They can’t have a yatch anchored in a bay without too much worry like they do here. They can’t park a flashy car in the street and go to a restaurant without a care like they do here. the car will be scratched, broken into or stolen… because there is a deep feeling of resentment from the “have nots” when they see how good some people have it.

    That is what is great about Australia. Here any person with a full time job, being in trades, university educated or not, or small business owner can have a decent life, raise a family, don’t worry about healthcare and education costs too much. They can all have a nice car or have nice holidays.

    If Australia is able to fix the housing mess then we can truly call ourselves an “egalitarian” society, and the “lucky country”.

    Just keep the money flowing, tax accordingly and with fairness, let the vast majority share a good slice of the pie, don’t allow extreme greediness, and you will be able to enjoy a quality of life that is the envy of the world. That is the way it should always be.

    I surely wish we never lose that, but sometimes I am afraid we have become too complacent
    and we don’t stand up anymore when the fair society that has been built for decades is being attacked by the same old groups.

  10. The old advertising requirement was serially rorted anyway.

    Business as usual from the Laberal party.

  11. Abbott is going to be the most successful class warrior of post war Australia.

    He will be greatly aided by the mining investment run-off and it’s impact on wage share and unemployment.

    I didn’t think he would be this bad, but he is simulatneously working to destroy civil society by cutting fundng to things like EDO and Drug and Alcohol Research.

    A lot of people are going to rue the day they voted for Abbott.

    I blame Rudd and Obeid more than anynoe else.

    • A lot of people are going to rue the day they voted for Abbott.

      No they won’t.

      They’ll blame it on the “tough steps that had to be taken” to deal with the “economic catastrophe left behind by Labor”.

      • Yeah, I’m sure Abbott will find a 3 word slogan to spin it to the public.

        Stop the Boats.

        Repeal The Taxes.

        Promoting Australia’s Prosperity.

        Wow.. it sounds so good I almost believe it!
        This is dangerous…

  12. Sounds like someone wakes up and recites Greenpan’s “If workers are insecure” quote every morning.

  13. When the 457 debate flared in the dying days of Gillard I provided links to Departmental publications showing that health professionals and IT were the prime categories each capturing over 20% of 457 total employment numbers – not exactly coolies.

    But before you all get too hot headed ‘cos ‘they stole our kerbs’ consider this article

    http://m.heraldsun.com.au/news/victoria/immigration-department-data-shows-number-of-work-visas-in-australia-continue-to-climb/story-fni0fit3-1226816936526

    Over 600,000 Kiwis! 200,000 young and students! And so on. All up nearly a million more than the much maligned 457.

    • Well, yes. UK, Ireland and NZ are the crux of it. If Mr Abbott succeeds in his oft stated intention of reducing Australian wages growth, he is very likely to make Australia a vastly less desirable location for three out of four of our top sources of migrants.
      The UK, in particular, is finally enjoying some wage growth sunshine after their GFC slump – yes, we’ll still have more literal sunshine, but you need to afford housing and all the rest to really enjoy it.

    • Hospitality industry i.e. just for cooks, kitchen hands etc. is about 300k, rising annually and significantly due to underlying ageing population demographic trends, and very significant turnover. The latter is due to odd hours, insecure employment and no doubt burnout……

  14. Let’s face it. Large corporations are running the country. Wasn’t this the main hidden agenda behind globalisation?

  15. wasabinatorMEMBER

    Politics is curiously under-represented by 457s, which is curious to note as it’s an area where there is clearly a vast skills shortage.

  16. If you’re young and reading this, this is why you should emmigrate.

    This is why the game is rigged.

    If housing was a proper market, and you suffered from 2004, 2005, 6, 7 watching housing become more and more expensive, only to be told “the market will correct itself”, your diligence was meant to be rewarded in 2008.

    You were meant to have exposure to the cyclical nature of markets, and be able to capture an advantaged point.

    Upside for the incumbents, downside for the aspirants.

    Except there are those in control who ensured you didn’t get a downside to take advantage of, crippling the economy for 15 years.. 15 years of your prime productive time.

    This piece is the same about wages.

    Increased scarcity means you pay higher for the commodity? Your skilled labour is a commodity.

    So when there is a downturn, you get wage suppression, lower wage share.

    in the upside, again, its time to make hay.. the cyclical nature…. except your adavantaged time is taken away from you.

    Housing, wages…. and the market is rigged against you.

    Do you have faith in the marketplace of Australia working for you?

    I didn’t think so.

    Leave it behind. It was a grand experiment, the very worst of England shipped away and proving with the right policies, a just society, they could transform themselves to amongst the very best.

    Then we had baby boomers. One generation to unwind it all, never to return.

  17. boomengineeringMEMBER

    Well they can take down those huge signs in Perth and Karratha Airpoprts BE PART OF SOMETHING BIG.
    There has never been a skilled shortage, always a ploy to lobby Gov’t for 457’s, looks like they won, Australia lost.
    You can’t tell me the amount of tradesmen who lost jobs and losing jobs can’t all be unsuitable.
    Out of tens of thousands applying and thousands interviewing I heard Gorgon will only take a handful the rest will be 457’s.
    This will end badly.

  18. Well with the drop in price of iron ore, poor gina has to make money somehow. Now that his leash holder has tugged little tony has provided the means for her to bring in an unlimited number of low paid workers. I mean it looks like the libs look to her to set welfare policy, why not labor and immigration policy as well.

  19. boomengineeringMEMBER

    Hey ” Angry ”I answered your request a while ago but no acknowledgement.
    Boom

  20. The 457 workers in the NSW south west irrigation area would mostly be agricultural workers and this group has not been mentioned.

    Currently New Zealanders are not going to Australia and statistics say its quite the reverse. The NZ LVR requirements for property purchases are biting and slowing the housing market sales and interest rates are about to rise which could increase that effect.

  21. I used to get really angry about the 457 system and how it’s used. But I’m over it. In the end it’s going to be about diminishing returns.

    Doesn’t matter how many 457s we shove into a canon and fire across our great country, Qantas and Telstra will remain uncompetitive in Asia.

    I am however, starting to get wary of the rise in bullsh*t jobs, and I want to remain reskilled and relevant.

    So avoiding the “skills shortage” jobs with poor pay and conditions, whilst avoiding the bullsh*t jobs, it’s a difficult task.

    • +1 to that. Bullsh*t jobs or what i call ‘lying for a living’ are just everywhere.

      The great challenge is to be skilled and relevant and have integrity in ones work, and that reverberates through your life.