Late last year, the Australian Population Research Institute (APRI) released an alarming new report entitled “Immigration overflow: why it matters”, which examined the widespread rorting of Australia’s visa system, as well as the crushing impact of Australia’s high permanent immigration program on Sydney and Melbourne.
One of the findings from this report was “the high and increasing numbers of IT professionals being granted 457 visas”, which “constitute by far the largest occupation group within the 457 program”:
The APRI claimed that most IT professionals being granted 457 visas are Indian nationals who are sponsored by Indian IT service companies. These companies have been successful in winning a major chunk of Australia’s IT consulting work on the basis of these 457 visa holders, partly because they are paying them much lower salaries than the market rate for IT professionals in Australia:
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As Table 2 shows, some 76 per cent of the 7,542 457 visas issued in the three IT occupations listed were to Indian nationals. The great majority of these were sponsored by Indian IT service companies as intra-company transferees…
Once in Australia their staff are being paid at much lower rates than experienced resident IT professionals and in some cases even new local graduates.
Even more disturbing is the relatively high proportion of these Indian IT professionals (28 per cent) whose 457 visas were approved at the extremely low base salary of $53,900 or less. This is despite the fact that only eight per cent of the 457 visas granted to Indians in the two ICT occupations in 2014-15 were aged less than 25.
The median starting salary for local ICT graduates under the age of 25 is around $54,000. Coincidentally, the 457 minimum salary ‘floor’ is set at $53,900…
The report also noted how the biggest sources of skilled permanent migrants – engineers, accountants and IT professionals – are also the areas with the biggest surplus of workers:
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Thus, the overall immigration system is destroying career prospects for local graduates in these (and other) areas.
The IT Professionals Association (ITPA) has clearly had enough of the rorting, claiming that local tech firms are abusing the 457 visa system and threatening to ‘name and shame’ IT organisations involved if issues are not rectified:
The ITPA… cited temporary work data from the government’s data.gov.au website which suggests there has been an unprecedented rise in 457 visas being issued to IT support workers over the past 10 years.
The data also found that while the overall number of 457 visas issued over the last decade (excluding IT) has risen by just 2 per cent, over the same period there has been a 136 per cent rise in 457 visas issued for IT workers.
Digging deeper, he said the growth rate for 457 visas granted to entry level occupations including systems administration and IT support blows out by over 480 per cent over the decade of 2005/06 – 2015/16.
“The ITPA has no issue with local IT organisations using 457 visas if they are genuinely unable to find suitable local candidates,” Hale said.
“What we are concerned about, however, is that many local IT organisations appear to be using 457 visas to hire international staff to work in entry level IT support positions rather than hiring and developing local graduates”…
With the growing number of people now being brought in on 457 visas to undertake these roles, he said it’s not surprising local IT graduates can’t find work, and the number of students studying IT degrees at Australian tertiary institutions has dropped in the last decade.
“What is happening in IT is the equivalent to Australian government deciding to scrap all medical internships at Australian hospitals and bring in surgeons from overseas who are willing to work for half the wages,” said Hale.
“If that was the case, the result would be that universities stop offering medical degrees and we would become totally reliant on importing overseas medical staff in our hospitals”…
“To stop abuse of organisations using the 457 visas system to fill systems administration and IT support positions, the ITPA calls on the Department of Immigration and Border Control to make details of all future 457 visa applications for systems administration and IT support positions available, so that we can promote to our members and IT graduates.
“In the interim, the ITPA has asked our membership to advise us of examples of alleged abuses they encounter and if any claims are substantiated, we intend to alert the Immigration Department. If the identified 457 abuses are not rectified we will ‘name and shame’ the IT organisations involved to our 7000 members and the media,” he said.
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Enter Fairfax’s Adele Ferguson, who over the weekend penned another troubling piece on the “rampant” exploitation of foreign workers and visa fraud in Australia:
Extortion, blackmail, cash back scams and slavery are happening every day under our noses. They happen in the most unsuspecting places such as suburban restaurants and nail bars. Most suffer in silence.
In some cases unscrupulous employers offer sponsorships to desperate foreign workers in return for payment. In other cases they lure unsuspecting workers into a job with the promise of sponsorship, then they turn on the blackmail dial.
The price of visas can vary from $30,000 to $150,000 depending on the visa, the job on offer and the worker’s nationality. For companies engaging in this illegal practice, the scheme offers big bucks…
If workers complain, their sponsorship is likely to be cancelled, inevitably leading to deportation unless a new sponsor can be lined up. Finding a legitimate sponsor isn’t easy and there are no protections for workers who are exploited.
Sadly, Australia’s immigration system has morphed into one giant rort that is robbing young Australians of a future, as well as choking the living standards of residents in our major cities, who are having to contend with stagnant wages growth, ever-rising congestion, deteriorating housing affordability, and overall reduced livability.
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Rather than labeling anyone wanting a reduction in Australia’s world-leading immigration program “political extremists”, Labor leader Bill Shorten should instead stand up for Australian workers and crackdown on the myriad of visa rorts that are depriving Australians of job opportunities and clogging our major cities.
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness.
Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.
