New modelling: Mass immigration makes Aussies poorer

New modelling from a group of academics from the University of New South Wales (UNSW) suggests that Australia’s mass immigration policy is making Australians poorer and raising inequality:

We modelled four development scenarios for Australia through to 2030:

  • “Growth at all Costs”, emphasising economic growth
  • “Green Economy”, emphasising environmental outcomes
  • “Inclusive Growth”, emphasising social equality
  • “Sustainability Transition”, balancing economic, social and environmental outcomes…

We then evaluated each scenario against the Sustainable Development Goals, an internationally recognised set of targets and indicators that measure national progress in 17 major areas. These include economic growth, poverty, inequality, education, health, clean water and clean energy…

Economic growth – defined as an increase in a nation’s production of goods and services – is generally measured by the annual change in real gross domestic product (GDP).

Our “Growth at all Costs” scenario involves accelerating economic growth through higher population growth and lower taxes. Net migration is modelled as being 350,000 a year by 2030, with the population reaching just over 30 million. The government’s tax revenue as a proportion of GDP is 10% less than now as a result of lower tax rates…

In our modelling this scenario increases GDP growth to about 2.6% a year, with low unemployment and declining government debt. But it comes at the expense of income inequality and the environment.

Even on the one goal it might be expected to do relatively well – Goal 8 – this scenario performs quite poorly. That’s because the goal measures per capita GDP growth, not just the total GDP growth most politicians talk about, along with a range of social and environmental indicators.

The following graphs show how the four scenarios compare on real GDP (i.e. adjusted for inflation), per capita GDP, income inequality and greenhouse gas emissions.

Sustainability transition

With an overall score of 70%, the “Sustainability Transition” scenario is the clear winner.

This scenario modelled slower population growth and higher taxes on consumption, income and profits and trade. With net migration of 100,000 a year by 2030, the population reaches about 28 million. Tax revenue as a percentage of GDP is about 8.5% higher than now. This funds more spending on health, education and social security, as well as the equivalent to 1% of GDP on the sustainability of transport, water, energy, agriculture and energy systems.

The overall result is economic growth of about 2.1% a year, with government debt 10% higher than our business-as-usual projection.

But per capita GDP is higher. Unemployment and income inequality are lower. Fewer people live in relative poverty, and life expectancy is higher. Energy, water and resource consumption is down. So are greenhouse gas emissions. There is more forested land. This delivers a more prosperous, fairer and greener nation in 2030.

While there are obviously other factors, it is worth emphasising that reducing net overseas migration (NOM) to 100,000 people a year achieves far better outcomes in terms of GDP per capita, equality, employment and the environment than the “business as usual” (NOM of ~200,000 a year) or NOM of 350,000.

Once I obtain a copy of this paper (locked behind a paywall), I will investigate the modelling more closely.

Leith van Onselen

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. The BystanderMEMBER

    Can’t wait for the usual suspects to try and ignore this research, and then, when they can’t poke any holes in the methodology, call the authors racists…

  2. What a surprise. In this UNSW study, “Growth at All Costs” or “Business as Usual” underperform greener models.

    The winning “Sustainability Transition” scenario “models slower population growth and higher taxes on consumption, income and profits and trade”. That rules it out immediately. Scotty and Albo would rather die, than move away from their futile Jobs N Growth auction, fuelled by record LIbLab migration and population growth.

    • NSW has already selected its path from DomainFax this morning “A new blueprint for the NSW economy predicts the state’s annual output will hit $1 trillion by the end of next decade and reach $2 trillion by around 2040 as consumer demand from Asia’s fast-growing middle-classes boosts exports.”

      Not sure what NSW has left to export?

      • The BystanderMEMBER

        Apparently importing hundreds of thousands of foreign students to buy degrees counts as an ‘export’ these days, despite nothing actually leaving our shores

  3. Fair dinkum…. We are importing low tier, low IQ vibrants… . Pseudo slave labour peons for the hospitality and other assorted industries. This is what is keeping a plethora of dodgy business afloat. The whole economy is a paper thin edifice that needs one shockwave to collapse it. Other than that, everything is fine and dandy.

    • While a solid shock would tip the economy into the abyss a slowing global economy is already leading the way. Unless your job survives courtesy of State patronage your business will be feeling the pinch. Another round of redundancies in the engineering sector here in Brisvegas recently with more to come. Those in Govt jobs are giggling maniacally (for now).

      • boomengineeringMEMBER

        Prom & Dom, The last client (about 15 employees (sub continent)) had to get a loan to pay, WTF? Living on a knife edge or what (paper thin edifice) and the huge fabrication shop (RA drill) paid first installment and nothing since (3 mnths). Obviously haven’t heard of float or savings buffer.

        • And I see Crinitis Italian restaurant chain into administration. 40 sites. Boom. High operational leverage and small downturn in revenues and …. boom.

          • boomengineeringMEMBER

            Yep the missus ex boss worked for them a while and said the same. Acedontal, used to be a patron but a revisit saw very few customers.

  4. nicely ironic that this report is from UNSW with its particularly healthy international student population.

  5. So the importation of 5 million* third world migrant guestworkers…

    🔻Lower our standard of living
    🔻Lowered the gdp per Capita by 10%
    🔻Destroyed wages, relatively down 7%
    🔻Destroyed housing affordability
    🔻Generated 75 million tonnes of extra Co2 in Australia.
    🔻Sucked our dams dry (46% of the pop of Sydney are non Australian citizens on a foreign passport).
    🔻Created mass congestion & overload of public service and infrastructure.
    🔻Created 1.4 million Australian unemployed & another 1.1 million seeking work
    🔻Destroyed education
    🔻Destroyed health care
    🔻Raised the cost of living
    🔻Created 116,000 Australian permanent homeless and another 360,000 seeking affordable housing.

    And Australia wants more of it?

    *5 million third world unskilled migrant guestworkers.

    ▫️1.9 million PR – 78% third world unskilled & below average income or welfare dependent. Aged, sick, useless third world detritus sucking up our Australian taxpayer Medicare & welfare.

    ▫️2.56 million TR & SCV – third world unskilled many working illegally in visa breach.
    We have more third world migrant guestworkers than Gaddafi at his peak.And his paid tax.
    Ours live in a foreign criminal run black market sub economy, the very epi-centre of foreign criminal run crime blackmarket & vice in Australia.

    ▫️440,000 long & repeat stay ‘Tourist Visitors’ third world unskilled Asian, Indian or Middle Eastern -“5% of the 8.8 million Tourist Visitors enter Australia enter to live & work illegally” – DHA Parliamentary submission.

    ▫️65,000 Overstayers.

    => 5 million non Australian foreign passport holders.

    And in a 90% concentration or 4.5 million in just Sydney or Melbourne.

    🔹Sydney pop 5.2 million.
    46% or 2.4 million are non Australian citizens.
    Third world migrant foreign nationals.

    => Nearly half the people in Sydney. A non Australian foreign national on a non citizen visa.

    Further concentrated in their fetid Sydney ‘migrant only’ slums that now stretch out to the horizon.
    Sucking our dam dry.
    Congestion, filth, squalor & overload.
    Faithful replicas of the Guangzhou, Mumbai & Cairo slums they were trafficked from.

    Melbourne, pop 5 million.
    2.1 million third world unskilled migrant foreign nationals on PR, TR, SCV, TV or an OS.

    -> 40% or 2 of every 5 people a non Australian foreign national on a non citizen visa.

    Congestion, overload, filth, squalor.

    The very same third world migrant only slums in Melbourne, also replicating where they were trafficked from.