RBA admits migrant visa system is lowering wages

Over many years, MB has consistently argued that mass immigration is helping to hold down Australian wages.

The economics is straightforward: when the working aged population continually increases via immigration, competition for jobs intensifies, worker bargaining power gets eroded, unemployment and underemployment remains elevated, and wages are held down.

The situation in Australia is particularly problematic because employers, through multiple visa programs, have been granted the ability to readily hire cheap migrant workers under the ruse of ‘skills shortages’, thus eliminating the need to train locals, as well as undercutting both wages and working conditions.

Yesterday’s Statement of Monetary Policy from the Reserve Bank of Australia (RBA) tacitly admitted that strong labour supply from mass immigration is keeping unemployment/underemployment elevated and contributing to a lack of wage pressures:

Employment has grown strongly over recent years and labour force participation is at a record high. There has, however, been little inroad into the spare capacity in the labour market recently, with the unemployment rate having risen slightly to 5.2 per cent…

Wages growth remains subdued and there is little upward pressure at present, with strong labour demand being met by more supply…

Taken together, recent labour market outcomes suggest that the Australian economy can sustain lower rates of unemployment and underemployment.

Last year’s speech on inflation by RBA Assistant Governor, Guy Debelle, similar admitted that immigration is holding down wages [my emphasis]:

There is considerable uncertainty about the extent of unutilised capacity in the labour market and how quickly a reduction in spare capacity would translate into higher wage and price inflation. It is possible that the unemployment rate could fall faster than expected and wages growth could pick up more strongly as a result. Alternatively, it is possible that the flow of new workers into the labour force could continue to be stronger than usual, so that unemployment declines more slowly than we expect and wage pressures could take longer to emerge.

Clearly, the mass importation of migrant workers is the driver of “the flow of new workers into the labour force”, which has caused unemployment to “decline more slowly” and “wage pressures… [to] take longer to emerge”. There is no other explanation.

Interestingly, Melbourne University demographer, Professor Peter McDonald, also last week admitted that three quarter of new jobs have been taken by migrants, thus displacing local workers:

“In recent times, about 75 per cent of employment growth in Australia can be attributed to recent immigrants”.

A 2017 research paper by Professor McDonald published in the Australian Population Studies Journal examined the impact of immigration on Australia’s employment growth after the Global Financial Crisis (July 2011 to July 2016).

It found that in the five-year period, employment in Australia increased by 738,800, with immigrants accounting for 613,400 of these jobs.

This follows the Australian Treasury’s recent report, entitled Shaping a Nation, which similarly found that migrants accounted for two-thirds of jobs created in the five years to 2016 and nearly three-quarters of full-time jobs created:

Modelling by both the Productivity Commission and Victoria University also shows unambiguously that immigration flattens wages.

Therefore, instead of providing jobs, Australia’s open migrant visa system is undercutting workers, crush-loading our cities, and forcing people to live in smaller and more expensive housing.

The bigger questions is: why isn’t the union movement and “Labor” party up in arms and fighting back? When will they stand up for ordinary Australians?

Unconventional Economist
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  1. Labor have totally lost the plot. As someone who grew up in a working class family, who voted labor most of my life, they have totally lost the plot. They are so corrupted by unions, super, then they have the left wing tards like wong and plibersek who want open borders free for all. The party has totally lost the reason for it’s existence.

    • Ex life long Labor voter from a Labor voting family here. I’m Labor’s natural constituency, but they’ve lost me forever for the reasons you describe.

      Labor are pointless and useless. They are just an obstruction that’s occupying the space that could be filled by an actual left wing party that looked after the interests of the people of this country rather than putting fireigners first. Wong and Plibersek? *Hawk and spit noise*

      The sooner Labor expires due to irrelevance and is replaced by something useful the better off we’ll all be.

      • ErmingtonPlumbingMEMBER

        You could kiss Medicare good by without them.

        The biggest problem “life long ALP voters” have is that THEIR party has been taken over by Metropolitan Bourgeois Bohemians.
        The leadership is infected with a Professional, Career focused, political caste who have no intention of being controlled and directed by the rank and file and working class base of OUR/their party.

        If the ALP can’t be retaken by a Working Class movement and be placed back on its traditional path of representing Working class interests, then there is FA chance of a new movement building up a completely new working class party from scratch.

        Some may say the Greens an alternative but they are infected with an even worse entitled to rule mentality and loathing of working class people.
        Virtue signalling progressives only allowed in their ranks.

        Either way if the Working Class can’t find the Solidarity to organise, fight and retake their Democratic power,… then maybe they/we deserve to lose.

        Bend over everyone and get used to dog eat dog cowboy Capitalsim,…there is much more to come.

        Meanwhile the Suicide rate, drug addiction and mass shootings are becoming the 21st century expression of the Slave Revolt.
        Good to see Hannity has a Capitalist low taxing solution to such things.

        Heavily armed Volunteer militias!


    • Politics is not about people — it’s about power and the organisations that confer that power on whichever party. No political party receives support on an altruistic basis — those doing the supporting want something in return, which means they end up steering policy.

      Politics these days is little more than a horde of cronies and parasites converging on the sitting government for their slice of the pie, everyone else be damned.

      This struck a chord with me:
      “The people alone won’t loosen the grip of these monsters and, honestly, they lack the will to even imagine life without all that.

      But history onrushing will do it for them, first in the form of a financial fiasco that upsets the meaning of what “money” is, and all the instruments calibrated in it; and then with an economic collapse of supply lines and activities that we can’t afford to carry on anymore.”

      • This is what happens when you destroy the ‘national interest’ as nativist and racist: it gets replaced by personal interest. What did people expect?

    • Labour cares about UNION workers – not workers. There is a MASSIVE difference.

      Tradies (CFMEU) are on $150-$200k – unions. IT are not unionised. And they are entirely replaced by Indians on $7.50 /day.

      Thats the difference.

    • As above, but they lost me in my late 20s (30 yrs ago). I vote to try and upend the big 2, though I no longer vote green for the obvious reasons. Labor ceased being the “working” party at least 20 yrs ago. Both parties are too close to big business with the only difference is L will try to protect the lower end somewhat more than the LNP, but nowhere near as much as they should.

  2. The Horrible Scott Morrison MP

    This only applies to blue collar workers, gray collar workers, and red collar workers (whores), so we should all be grateful.

  3. The Labor party cares firstly about unions, secondly about “multiculturalism”. Both it’s masters/ideologies demand mass immigration – particularly from countries where workers are paid much, much less than in Australia.

    Regarding Australians that were actually born in the country or who’s ancestors defended the country? Forget about it! – concern for them is called “racism” and “bigotry”.

  4. Just as Steve Bannon says low paid workers inside the U.S. are protected by a wall, and the UK finds that lowering migration means wages rise, the RBA belatedly finds that wages do not rise with open borders….. Must have read MB.

    It seems a pity that the only people in Parliament to understand this are the two senators who voted for a population plebascite. The others are conducting a war against lower paid locals to crush their wages and living standards.

    • The RBA know full well what’s going on with immigration and wages — they just haven’t been able to say it publicly.

      The left wing media would jump on explicit comments to this effect and end careers — nobody can afford to ‘go there’.

    • drsmithyMEMBER

      Just as Steve Bannon says low paid workers inside the U.S. are protected by a wall […]

      Real wages for the working classes in the US have been stagnant for forty years. Were the Mexicans suppressing wage growth in the ’70s ?

  5. According to Labor’s Shadow Minister Keneally, the global social justice of unchecked immigration is much more important than the local social injustice of crush-loading our cities, stiffing their residents, and smothering their wages.

    • What’s her salary again? Typical globalist. Earns tons of money and wants to give taxpayer money away to foreigners. This is how you destroy the social contract. Why should I agree to pay taxes when my moronic leaders then squander it on their own vanity?

    • The RBA board has a serious skills shortage. I really think some members should be replaced with some lower cost workers.. perhaps from India or some subcontractors from China? The RBA board are all white, right? Blatant discrimination against Indian, Chinese etc. workers really.
      Same goes for all the university vice chancellors in Australia – all white, right? Racist institutions.

      • Funny how the biggest globalists all work in high paying jobs that aren’t affected by mass low wage immigration, isn’t it?

      • Jumping jack flash

        “I really think some members should be replaced with some lower cost workers.. perhaps from India or some subcontractors from China?”

        While they could be replaced with immigrants who are paid less, who would steal the extra wage capacity?
        There is no impetus for this.

        It is only pleb workers who are replaced by cheap immigrants because the freed wage capacity can be passed up the chain.

        The entire reason for doing this of course is the necessity of obtaining continuously larger and larger amounts of debt to buy the things we need.
        You’re not entitled to debt (yet), even though debt is now completely necessary, and you won’t get debt for free (ever). No sir. Debt capacity is (still) a function of income.

  6. The MSM have done a great job of not talking about it. Not until we have a TV reality show called “ Where the bloody hell are you?” where contestants have to round up 3 australian born mates for schooners at the pub before going to the cricket dressed as Richie Benaud, no one will notice

    • In 10yrs from now the contestants will have to fly their mates in from abroad in order to make it work.

      Slightly OT: if someone from the sub-continent turned up to the cricket dressed as Richie Benaud, would that constitute ‘cultural appropriation’? And if so, would this heinous act garner a swift rebuke from the media and various social justice spokespeople?

  7. Stewie Griffin

    The bigger questions is: why isn’t the union movement and “Labor” party up in arms and fighting back? When will they stand up for ordinary Australians?

    That would be because the “Labor” party is simply following the tradition of Ironic naming in regards to our political parties.

    We have the “Liberal” Party, which is an conservative party of globalists.

    We have the “National” party, which is an ultra-conservative right wing party of globalists.

    We have the “Green” party, which is mainly an inner city party of globalist wankers about as far removed from the environment as humanly possible.

    And of course we have the “Labor” party, which is a centrist party of globalists who represent the working man working person, provided that working person works at a University, or as a Journalist, intern for Labor politican, or of course, a genuine foreign worker as opposed to our racyst native born workers.

  8. This country has the politicians we deserve. It’s obvious the majority won’t understand what they’ve done until the country is proper stuffed, let them keep voting in the idiots and let them suffer the consequences. It’ll suck for awhile but the potential for new political growth in response to the absolute failure our parties are now can deliver a new era of competent governance for 50 odd years.

  9. Jumping jack flash

    Hey hey! They must have dusted off the old communiques between Rudd, Gillard and Howard with the banks and RBA, and finally found the original reason for the high immigration.

    Not a lot to do with the mining boom and not enough skilled workers – the mining boom is well over and yet we have more “skilled workers” arriving than ever before.

    It had everything to do with the scaremongering around runaway wage inflation, prompting Howard’s Brainfart (Workchoices) and his subsequent demise. Only to be replaced by Rudd and Gillard and massive amounts of immigration. It is no coincidence.

    The problem now becomes trying to take away the immigration when it is pretty much the only thing driving any kind of wage inflation – for the top echelon. Statistics does the rest with “averages of averages”.

    Without substituting cheap immigrants which creates spare wage capacity for the bosses to steal, there would be no wage inflation whatsoever. And with no wage inflation comes no new debt, without lowering interest rates forever which is impossible. Raising prices isn’t really an option either.

    No new debt means the economy doesn’t grow because our new economy is essentially based on debt growth, paid for by services, paid for by debt – basically pushing money around forever in a loop, which works great on paper, until you consider the interest. (which is why interest rates are now so low… whoops!)

    They have quite a pickle on their hands with this one now.

    • Might just have to develop export generating industries. Start by scrapping the light-entertainment and propaganda conglomerate that is the ABC for a Medical Research Fund.

      • Jumping jack flash

        Don’t know about scrapping the ABC though.

        But wrt investment in export manufacturing – it makes no sense in the current environment for private enterprise to do this, because it is still way easier to make money from other people’s wilingness to take on enormous piles of debt and give them away, wage theft, and gouging essentials.

        And the government would never do it while their mantra is still neo-liberalism.