Last month, WA Premier Mark McGowan released an updated version of the state’s skilled migration list, slashing it to just 18 eligible occupations from 178 previously. This followed McGowan formally writing to Prime Minister Malcolm Turnbull in March, seeking to remove Perth from the Regional Sponsorship Migration Scheme, thus effectively preventing a pathway for overseas workers to gain a visa.
Over the weekend, Steven O’Neil – the Managing Director of Iscah Migration – penned an article in WA Today claiming that McGowan’s immigration curbs had put ‘a wrecking ball’ through the state’s economy:
Official DIBP figures through to March 2017 show that WA is already 12% down on new student visa grants from 2015/16 numbers, whilst the rest of Australia has actually increased nationally by 3%.
The international student market is worth 10,000 West Australian fulltime jobs and over $2 billion to our economy annually…
Numerous economic studies have found that skilled migration creates more jobs than are taken up by the migrants themselves.
They bring savings from their home country and spend this in Australia creating additional demand in the economy. They also are relatively young and are a vital factor in balancing those of workforce age with our aging and pension drawing population.
Research has shown that up to 1.6 jobs are created by each skilled migrant to Australia. They are win/win for our country and state.
However, the Premier has pumped his chest out twice in recent months, claiming to be protecting WA jobs when in fact his decisions are likely to result in the exact opposite – a massive loss of WA jobs…
Students are not stupid, they read the headlines and make careful decisions where to study, who really wants them. All these announcements do is completely turn off prospective students from choosing WA as the place to study.
They will simply move elsewhere…
The Federal Government have already made visa changes that will see students not even choosing Australia as a study destination.
A survey of 500 international students from around Australia resulted in 88% saying they would not recommend Australia to their friends and family as a destination to study in. That is going to hurt us economically like never before in the next few years.
Now in an ever tighter market the premier has made it clear that WA is not welcoming international students. This is going to severely hurt one of the few growing WA export industries, our $2 billion International education industry…
When each skilled migrant creates 1.6 jobs in demand for our state, what a nonsensical approach. No wonder our budget is in a mess.
What a load of rubbish. With WA unemployment and underemployment sky high:
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And WA wages collapsing:
Where is the policy rationale in raising labour supply via temporary and permanent migration, thereby devaluing WA workers in the process? There is none, unless you are a rent-seeking migration agent.
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More broadly, O’Neil’s claim that “each skilled migrant creates 1.6 jobs in demand” doesn’t pass the sniff test.
The below chart shows that so-called “skilled” migrants made up around 129,000 of Australia’s 200,000 strong permanent migrant intake:
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However, the Productivity Commission’s Migrant Intake Australia report explicitly stated that around half of the skilled steam includes the family members of skilled migrants, therefore around 70% of Australia’s total permanent migrant intake not actually ‘skilled’:
…within the skill stream, about half of the visas granted were for ‘secondary applicants’ — partners (who may or may not be skilled) and dependent children… Therefore, while the skill stream has increased relative to the family stream, family immigrants from the skill and family stream still make up about 70 per cent of the Migration Programme (figure 2.8)…
Primary applicants tend to have a better fiscal outcome than secondary applicants — the current system does not consider the age or skills of secondary applicants as part of the criteria for granting permanent skill visas…
The PC also showed that while primary skilled migrants have slightly better labour market outcomes than the Australian born population in terms of median incomes, labour force participation, and unemployment rates, secondary skilled visas, and indeed all other forms of migrants, have much worse outcomes:
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The PC’s analysis was supported by the ABS’ latest Characteristics of Recent Migrants report, released last month, which 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%):
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.
