Labor: Temporary visa tsunami is crushing wages

Labor has called for an urgent review of the temporary visa system after the latest report from the Australian Population Research Institute (APRI) revealed a high concentration of temporary migrant workers across large swathes of the economy (see below table).

From The Australian:

Labor has called for an urgent examination of the temporary visa regime following new ­analysis that reveals the number of ­migrants on the visas has jumped from 1.8 million to 2.2 million in the past four years…

Labor employment spokesman Brendan O’Connor said the “increased overreliance” on temporary visas to supply labour was of great concern when there was nearly two million Australians unemployed or underemployed.

“The government should ­urgently examine the current temporary visa regime with a view to identifying the extent of the misuse and overuse of such visas. Our first employment priority as a nation must be to provide employment opportunities to local workers,” he said.

Employment Minister Michaelia Cash said the government was committed to ensuring Australians had priority for jobs and overseas workers were only recruited to fill genuine shortages…

“Under labour market testing, employers must advertise the position within Australia to ­ensure Australians are given first priority. Employers can only seek overseas workers if they can demonstrate Australian workers are not available,” she said.

“We make no apologies for trying to get Australians into high-skilled, high-paying jobs.”

The $53,900 Temporary Skilled Migration Income Threshold (TSMIT) that applies to Temporary Skills Shortage (TSS) visas has been frozen in place since 2013-14, and has fallen $23,000 below the median full-time Australian salary of $76,900.

Not surprisingly, then, the actual pay levels of ‘skilled’ migrants in Australia is also abysmally low.

According to the Department of Home Affairs’ Continuous Survey of Australia’s Migrants, the median full-time salary 18 months after being granted a skilled visa was just $72,000 in 2016, below the population median of $72,900. This is shocking given the population median includes unskilled workers, which obviously drags the nation-wide median full-time salary down.

The ABS’ Personal Income of Migrants survey also recorded a median employee income of migrants under the skilled stream of just $55,443 in 2013-14.

In a similar vein, separate ABS data shows that Temporary Work (Skilled) visa holders earned a median income of only $59,436 in 2016.

The easiest solution to restore integrity to the visa system is to make all skilled migrants employer-sponsored and require them to be paid at the 80th percentile of earnings, or indexed to double the median wage. This would ensure that the skilled visa system is used sparingly to import only the ‘best of the best’, not as a general labour market scheme to undercut local workers.

Of course, ‘skilled’ visas are only part of the issue, with international students and graduate visas arguably an even bigger problem.

Regardless, all forms of temporary visas represent a massive labour supply shock that has lowered the bargaining power of local workers and placed downward pressure on wages.

Sadly, our policy makers have no intention of actually fixing the system. To them, mass immigration is a tool to juice headline growth and to feed the growth lobby both consumers and cheap foreign workers. The welfare of ordinary voters is ignored entirely.

Unconventional Economist

Leith van Onselen is Chief Economist at the MB Fund and MB Super. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.

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Comments

  1. Employment Minister Michaelia Cash said the government was committed to ensuring Australians had priority for jobs and overseas workers were only recruited to fill genuine shortages…

    Oh fcuk that miserably lying b1tch and her stupid haircut. Damn her and her lies to an eternity in hell of burning and being poked with spears by demons…or even worse…listening to the collected speeches of Scott Morrison.

    • She’s like something out of a mid 70s (or 80s) English political satire

      And that voice

      And lest I be called sexist, there are plenty of man pollies that evoke the same response

      That abominable Tim Wilson is one, like ERMAGERD

        • Great Southern Land

          His driving history includes instances of driving unlicensed, negligent driving, speeding and refusing a breath test.

          Why the FVCK is this scum still in the country and still licensed to drive heavy vehciles? Both he and his boss need to be in prison for a long time.

          At least we can be glad the ABC censors knocked off early to hit the pub – can’t image their bosses will be too happy when they realise that all this detail slipped through and onto the screens of the punters who ‘have not been educated sufficiently to be able to process information such as this’

        • TESTIMONIALS
          Singh’s Truck Driving School is expert in the trade and they know how to train the person as per their abilty to make sure they will pass the exam. I am very happy with the service and the trainer was very polite and nice man.
          Jag Singh (Now Licensed MR Driver)

      • So that guy had a history of domestic violence, driving unlicensed, negligent driving, speeding and refusing to take a breath test. All by the age of 26. And he was working as a truck driver. FMD. Just the sort of productive high skilled immigrant this country needs…killing the little children that Australians won’t.

        I recently visited the WW1 battlefields where my grandfather fought and suffered. I wonder what he would think if he could see what has become of the country he served so well.

        • Sorry – the sad thing is the driver probably bought his driving licence overseas. He then just converted it here without needing to be re-tested. It’s a common practice with mainland Chinese drivers.

  2. Nevertheless, it is on record that Labor has raised no objections at all to Frydenberg’s near-record 270K net migration, and (as also well documented by Bob Birrell) they tried to raise it by many thousands via migrant parent visas.

    When they acknowledge their error, and call for migration to be halved, then I might just begin to believe that their “first priority” is “local workers”. As long as Keneally is immigration shadow, that’s never going to happen, is it.

    • Two for the price of one.

      1. If husband and waifu both have jobs, they can afford to pay more for property. This is great news!
      2. Big businesses have even further downward pressure placed on wages, thus the potential for exploi… um, profit maximisation is greater. More great news!

      How good is Australia!

  3. Jumping jack flash

    These migrant workers have so far performed their duty very well – to inflate the debt that drives our miracle economy to ever-higher highs.

    The way they do that is of course to enable employers to cut fixed costs, thereby boosting their own incomes, which they convert into debt, which everyone needs.

    However if the debt growth slows, or if there is so much as a hint of deleveraging, then the banks will make sure that these migrant workers are paid a “fair wage”, ie, one they can use to obtain the mountains of debt that are required to become successful in this fine country.

    We see a little bit of a push for this already.

    The alternative, which is no debt growth, or, *gasp* deleveraging, would be absolutely disastrous. Why? Well, you see all the debt has been attached to inherently unproductive assets. The debt generates interest. A ton of interest. The more debt, the more interest, and there are trillions of debt dollars that have been magicked up by the banks and attached to nonproductive assets. That interest must be paid on top of the principal, and the asset it is attached to does nothing to help that. Therefore the interest must be paid out of something that is actually productive and generates money. There’s less of these all the time because debt is just a much better way to “create” money, than actually skillfully building something and selling it to the world for a profit.

    For the moment the debt is growing fast enough so it can repay its own interest. This is completely sustainable of course, and there is nothing to worry about, as someone well accustomed to the workings of the New Economy would know, but if the impossible happened and the debt doesn’t grow, or worse, shrinks, then we’re in massive trouble.

  4. When Labor actually makes this an issue, not just talking points, then I’ll believe it. Besides, Penny fvcken Wong will scupper the idea.

    As for the Liberals; seriously, rolling out Mikayla Ballrash with the stock standard “we’re addressing the issue” is like rolling out Barnaby Joyce to preach about family values. No one believes them except them. We’re so fvck’dest.

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