Are migrants more productive than locals?

By Leith van Onselen

One of the arguments used to support mass immigration and a ‘Big Australia’ is the notion that migrants are more productive than the Australian born population and, therefore, boost overall productivity.

Yesterday, the Australian Bureau of Statistics (ABS) released its Personal Income of Migrants, Australia, 2013-14, which on face value seemed to support this notion, with permanent migrants reporting higher average incomes ($48,400) than the median employee income for all Australian taxpayers ($45,700):

The median Employee income of migrant taxpayers in 2013-14 was $48,400. This represented a 1.0% increase in real terms on median Employee income in 2012-13.

The median Employee income of migrant taxpayers was higher than the median Employee income for all Australian taxpayers ($45,700).

No doubt, this release will get the immigration boosters chomping at the bit saying “I told you so”. But before they get too carried away, there are several important ‘flies in the ointment’ that must not get overlooked.

First and most importantly, the “median Employee income for all Australian taxpayers ($45,700)” includes every employee in the country – such as young uni students working at Coles, Kmart or Maccas, mums working part-time, etc – which obviously pulls the national median income down.

It’s fair to assume that most migrants are not granted permanent residency so that they can pack shelves at Coles or work at 7Eleven. Rather, those in the ‘skilled’ stream at least, which makes up the overwhelming majority of permanent migrants, are expected to be working at high capacity. In this regard, I am surprised that their average earnings were only $52,892 in 2013-14, which seems pathetically low.

A fairer ‘like-for-like’ comparison of the productivity of migrants requires them to be compared against local workers of similar composition.

While data is somewhat sketchy, research in 2013 by Bob Birrell and Ernest Healy found that while 69.3% of Australian graduates aged 25-34 had managerial or professional work in 2011 and only 9.5% were not employed, only 30.9% of non-English-speaking-background [NESB] migrants who were graduates of the same age, who had arrived between 2006 and 2011 had managerial or professional work. And a full 31.1% were not employed. Most of this group of graduate arrivals (79%) were of NESB background:

Thus, very few held the professional or managerial jobs for which they were nominally qualified, and for which they had gained their visas.

Second, the Australian Bureau of Statistics (ABS) latest Characteristics of Recent Migrants report, released last month, also revealed that migrants have generally worse labour market outcomes than the Australian born population, with recent migrants and temporary residents having an unemployment rate of 7.4% versus 5.4% for the Australian born population, and lower labour force participation (69.8%) than the Australian born population (70.2%):

Clearly, the claim that migrants are more productive than locals is highly debatable. Anyone looking to this for justification for maintaining Australia’s 200,000 strong permanent migration program should seek a more robust line of argument.

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Unconventional Economist


  1. Also, do not the vested interests say “wages will go up if we hire Aussies”?

    So the globalists are contradicting themselves. Do 457 visa staff come here and provide deflation or do they get paid more than Aussies?

    Ronald Reagan had a choice – inflation or unemployment. He chose the latter:

    Interest rates were raised, inflation was slashed and unemployment soared.

    Stupid AUS has chosen both! Land+road+water price inflation and mass unemployment!

  2. The number to work with is 5 million new migrants onshore in the last decade.
    2.5 million citizenship/PR grants PLUS the 2.5 million Temporary visa, illegally working visitor/tourists and overstayers. (85% concentration or 1 million each in our two capital cities).

    Of the 2.5 Million migrant citizenship or PR grants in the last decade – according to ABS and ABF – only 710,000 or 28% had a professional qualification that was at the same or above an Australia average.
    So 68% or over two thirds were below. (Refugee, family reunion, spousal and all the other visa scams).
    And that’s reflected in the aging profile, welfare dependency and health care burden, courts & prisons.

    Then ADD the 2.5 million temporary (2.1 million) or tourist or visitor visa holders (400k) or overstayers (70k).

    Have a look at the 2.1 million TR visa categories, age, country of origin and visa pretext.

    Only a small fraction are ‘skilled’ – 72k 457 primary (and a lot of that is doubtful) and 36,000 post graduate internatioal students in conversion to being employable in a professional vocation..

    So about 110,000 of 2.5 million or 4.4% ‘skilled’.
    There is your main issue with the logic.
    These (TR/visitor/illegals) people are also here, onshore, working, most illegally, cash in hand, blackmarket, vice.

    Add the two together, it’s about 820,000 of the 5 million migrants (citizen, PR, TR, illegal) or only 16%
    Which means of the total migrant intake of 5 million, (citizenship, PR) and TR/illegal working visitors & overstayers – 84% are below an average Australia education and skill level.
    Basically 8 out of 10 migrants lower our skill base and standard of living & wages.

    Anecdotally about half are unskilled, very unskilled, many not even literate in their own home language.

    We have the most corrupted migrant visa program and lowest level unskilled migrant intake of any OECD nation.

    It’s not a productive or skilled intake.
    Far from it.

    It’s a flood of very unskilled low level migrants, mostly procured in via foreign criminal syndicates – on a variety of visa pretexts to be a massive economic & social burden.

    • Yes, but unskilled immigrants can perform the same task for less than unskilled locals, who need to be paid at least the minimum wage.

      Thus immigrants perform the same task for lower wages, and from a business perspective are MORE productive.

      • From my experience as a low skilled worker (cleaner) many international students i work with are overworked and underpaid. Many have to take on too many hours just to survive. The consequence is many are forced to cut corners. It’s easy to make things look clean, it’s much harder and time consuming to make them actually clean.

        Ultimately you get what you pay for.

    • Is this the new MB?
      Common on guys surely we can raise above this level of gibberish. If not than MB deserves its fate!

  3. boomengineeringMEMBER

    What I noticed years ago was that Italian migrants of the 1950’s to 1970’s worked really hard but the Italians in Italy were quite lazy. Then it occurred to me it was the same when Aussies worked overseas. It is the insecurity factor of living in a foreign land with no relatives or friends to back you up that prompts you to surround yourself with money as protection. Some race of people have had no homeland for thousands of years and obsession with money in ingrained in their genetics.

    • There’s also the angle that as an immigrant from somewhere like the Philippines you have every reason to work hard because you have essentially won the lottery, even if only for the short-term. The average wage in the Philippines is something like 3.5k per year so if you’re getting something like minimum wage in Australia and you can save half of that then you’re getting rich quickly by your home country standards.
      After a couple of years work, you could well buy a home freehold back home so, yeah, if that were me I’d be working hard and stashing away as much cash as possible.

    • Reminds me of London many moons ago — the Aussies working there would always say: Gee the Poms are lazy.

      Meanwhile, the very same scenario was playing out here: travellers/immigrants vs lazy locals.

  4. From what the Guardian and the Greens tells me, so long as they are not male and white they’re pretty much better at everything.

  5. What are the statistics on ‘skilled’ immigrants bringing in parents from overseas ?

    A walk down the main streets of Chatswood, Eastwood, Hurstville, Burwood would really question whether any of the people in grey hair actually contributed any income tax to the economy in the past few decades, while now potentially enjoying pension and other social security benefits? My only guess is that they were brought in with their [only] child who was deemed a skilled migrant.

    • boomengineeringMEMBER

      And they are not so fit either, hobbling around so probably unable to work in future as well.

    • The visa to bring in parents costs around $40,000 but is worth it, as after 4 years they are eligible for local pension and Medicare. Many are ex-communist party officials and also get a pension and other income in China.

  6. Are migrants more productive than locals?
    Probably not, but whose fault is that?
    Australia gets to choose who it lets in, you can hardly blame the migrants for the poor choices that today’s Aussies make.
    A better question would be:
    Who has a greater capacity to develop differentiated export markets for Australian products, 3rd generation Aussies or recent migrants?
    Our problem is that we don’t reward our exporters. To be honest every Australian involved in export businesses (other than digging up dirt) should logically leave Australia immediately. Every last Aussie exporter is getting F#cked unmercifully and the situation is not getting any better. Until this changes we cant really expect migrants to be equally productive members of our society when we create deliberate disadvantages in exactly those businesses/ventures where migrants would logically prosper.

    • But if we try to encourage their best and brightest we get accused of being a colonial stealing the talent of those less fortunate countries.

      • That’s the thing, Migrants that can directly leverage their knowledge and contacts in a foreign land do not need to be the Best’n’Brigest to prosper in their adopted land. Their advantage is this trust network that they bring with them, it’s a part of them. Our economic/structural framework limits their ability to fully develop this natural advantage.
        Our extremely over priced housing and extremely over valued currency mean the recent migrants (much like young Aussies) are too busy focusing on the money side of life to ever properly develop their innate business advantage.
        Wrt economics one thing is certain, change will come and when it does we’ll see who is really productive and who is simply leveraging the advantage they’ve created over the last generation or so.

    • I’m not saying you’re wrong but I’m very curious to know how our exporters are f#cked because I can tell you one thing for certain, the group getting even more f#cked are the importers. I know, because I am one. The hoops you are made to jump through to get shit into the country are obscene: regulations, duty, gst, arbitrary import charges, f#cked in the arse by lazy, overpaid, unionised port workers. You name it. No wonder we’re one of the most expensive countries in the world. After dealing with the above, it’s a wonder that anyone actually has any energy left to actually sell what they’ve imported.

      Exporting must be a doddle by comparison.

  7. I can only speak to anecdotes, but in my experience (many years ago, in hospitality) indian students on temp visas were a lot harder working than the Australian born individuals.

    • Two sides to this: One is that, of course, you would work harder because you’ve got an opportunity to take a huge jump in standard of living and quality of life. You’d likely be earning 10 times as much as home so you have an opportunity to save a lot of money.
      Two, I spend a lot of time in airports, where most of the jobs are done by immigrants, and I don’t see a lot of hard work. I’ve seen the cleaner hiding in the toilets while having a chat to his wife or some friend. I’ve seen taxi drivers asleep in their cabs or having extended chats with their colleagues. On average, I see a lot of workers mooching about as though worklife in Australia is pretty friggin good.

      • “I’ve seen taxi drivers asleep in their cabs or having extended chats with their colleagues.”

        Does lack of productivity matter when they aren’t being paid?

    • more anecdotes from recent times, i employ many migrants and deal with migrant truck drivers, couriers, packers, sales people, tradies etc every day and when it comes to anything with responsibility and a certain skill level Australians are way more productive, what they don’t want to do is low paid manual labour and they don’t hide their feelings about it lol

    • I’ve seen this in IT. It probably helps that kids in other nations aren’t raised on a bullshit diet of “You can be an astronaut or a president when you grow up”. Instead they’re told something more like “You’d better be a doctor or a lawyer or so help me…!”

      I think the other factor is that plenty of workers coming here may be coming here for cultural reasons as well as career. E.g. lets say you’re a creative young Singaporean or Japanese person (bad source country example but lets run with it). Back home you may find yourself in a very rigid corporate structure, unable to really spread your wings. But in Australia, there is more room to acknowledge a young person’s ability and let them cut loose. I think in that situation a foreigner will also have high morale. “Wow, in Australia the boss knows my name, instead of there being 10 levels of management between me and him!” vs “Damnit, I wanted to be an astronaut..”

  8. Mr SquiggleMEMBER

    This article reminds me of the time when someone tried to tell me migrants have more children than non-migrants.
    So I looked it up on the ABS and sure enough, there is no real difference. On average, Migrant households have the same number of children as non-migrants

    • So … obviously – what you say there is that “we need more migrants”, no? 😛

  9. drsmithyMEMBER

    It’s fair to assume that most migrants are not granted permanent residency so that they can pack shelves at Coles or work at 7Eleven.

    I can just imagine the sniggering as you wrote that. 😀

    Rather, those in the ‘skilled’ stream at least, which makes up the overwhelming majority of permanent migrants, are expected to be working at high capacity. In this regard, I am surprised that their average earnings were only $52,892 in 2013-14, which seems pathetically low.

    You say “surprising”, business says “achievement unlocked”.