Committee for Adelaide demands slave wage migrants

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By Leith van Onselen

Just when you though Australia’s ‘skilled’ migration settings couldn’t get any worse, we got the following from the Committee for Adelaide [my emphasis]:

Migration experts warn a new plan spruiked as driving population growth in South Australia is practically “problematic, risky and very costly” to local businesses because the government hasn’t got the policy settings right…

Committee for Adelaide member and prominent migration agent Mark Glazbrook told parliament “a successful migration program… needs to be based on demand and it needs to be based on the relevant industry settings” – something the proposed SA migration agreement was not…

He suggested the threshold salary for participants was too high, noting the existing minimum salary level for temporary skilled migrants was $53,900…

“That is above what a lot of people get paid in regional areas and in different occupations,” he said.

“If we were to see [that] increase to a higher rate, then it effectively renders a lot of the occupations that are within the DAMA inaccessible.”

He said a “big issue” with the SA plan was the lack of a clear pathway to permanent residency…

Yes, you read that right. The appallingly low $53,900 wage floor for ‘skilled’ temporary migrants is supposedly too high, even though it is $32,700 below the current average full-time Australian salary of $86,600, which comprises both skilled and unskilled workers.

Joanna Howe, Senior Lecturer in Law at University of Adelaide, explained the dire ramifications of this $53,900 wage floor in the recent book, The Wages Crisis in Australia:

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This crisis has been precipitated by the federal government’s decision to freeze the salary floor for temporary skilled migrant workers since 2013… the government has chosen to put downward pressure on real wages for temporary skilled migrants, thereby surreptitiously allowing the TSS visa to be used in lower-paid jobs…

This salary floor is called the Temporary Skilled Migration Income Threshold (TSMIT). TSMIT was introduced in 2009 in response to widespread concerns during the Howard Government years of migrant worker exploitation…

In effect, TSMIT is intended to act as a proxy for the skill level of a particular occupation. It prevents unscrupulous employers misclassifying an occupation at a higher skill level in order to employ a TSS visa holder at a lower level…

TSMIT’s protective ability is only as strong as the level at which it is set… But since 1 July 2013, TSMIT has been frozen at a level of A$53 900…

This means that the TSS visa can increasingly be used to employ temporary migrant workers in occupations that attract a far lower salary than that earned by the average Australian worker. This begs the question — is the erosion of TSMIT allowing the TSS visa to morph into a general labour supply visa rather than a visa restricted to filling labour market gaps in skilled, high-wage occupations?..

Put simply, temporary demand for migrant workers often creates a permanent need for them in the labour market. Research shows that in industries where employers have turned to temporary migrants en masse, it erodes wages and conditions in these industries over time, making them less attractive to locals…

So the failure to index the salary floor for skilled migrant workers is likely to affect wages growth for these workers, as well as to have broader implications for all workers in the Australian labour market.

The Committee for Adelaide clearly wants to turn South Australia into a migrant slave special economic zone that is allowed to shred wages and employment standards with impunity.

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About the author
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.