Memo to ALP: labour market testing of ‘skilled’ visas does not work

Labor’s Kristina Keneally has called for greater labour market testing to ensure that temporary migrant workers fill general skills shortages, rather being used by employers as a tool to undercut wages and employment conditions:

“When we’ve seen temporary migration levels soar… we’ve seen exploitation occur. And that exploitation has put downward pressure on wages.

When we have seen temporary migration soar, and we don’t have independent labour market testing, that has made the job market more difficult for Australian workers…”

This is an opportunity for us to talk about the exploitation of temporary migrant workers, the lack of independent labour market testing, the downward pressure that that puts on wages, and how we get those settings right”.

While Labor has correctly identified the problem, one wonders why Labor continues to insist of labour market testing, which is little more than an administrative hurdle that can be easily gamed. As noted by Abul Rizvi last week:

For years, however, the Government has resisted setting a much higher minimum salary for skilled temporary entry while the unions have insisted on “labour market testing”.

The former is crucial to both protecting job opportunities of Australians and limiting the risks of exploitation of temporary entrants. But the latter, while having a laudable objective, is in practice little more than a bureaucratic charade…

Instead of going down the bogus “labour market testing” route, Labor should instead demand that the Temporary Skilled Migration Income Threshold (TSMIT) be lifted dramatically from its appallingly low level of $53,900, which is $3,300 (6%) below the median income of all Australians ($57,200), which includes unskilled workers:

This $53,900 TSMIT has incentivised Australian employers to hire cheap migrants instead of local workers, as well as abrogated the need to provide training.

Lifting the TSMIT to the 75th percentile of weekly earnings (currently $85,852 p.a.) would ensure that employers only hire migrant labour to fill genuinely skilled professions, while eliminating the need for labour market testing.

It’s a no-brainer.

Leith van Onselen

Comments

  1. If you want decisions that require no-brains to make, you’ve certainly got the right people to make them in the federal political arena.

    • Andy McPherson

      It’s not no-brains – it’s working as intended.

      Advertise on Gumtree for a very specific position, at half the market wage ($53,000). No one applies. You’ve “tested” the market, there is no-one so you can employ your foreigner.

      It’s a great win for businesses. It keeps labour costs way down.

      An additional plus is that foreigners can be worked 60 hours a week as they don’t want their visa sponsorship withdrawn.

      Any business that does not use “skilled” migrants is wasting shareholder money.

  2. Jumping jack flash

    If there isn’t a credit crunch at the moment, there surely will be after this.

    There’s already a dire shortage of debt which is killing the economy. We need more debt, not less, and that means more wage theft, not less, to get more people stealing their slaves’ wages, boosting their own wages up and over the debt eligibility bar so they can obtain and maintain the amounts of debt that are absolutely necessary.

      • Jumping jack flash

        To stop now would be catastrophic.

        Actually it doesn’t even need to stop to be bad, it just needs to slow a little, like it has over the past 7 years (compared to the period before that) and here we are, suffering fantastic debt deflation, and experiencing all the good things that it brings…

  3. Keneally can say whatever she likes on migration, Albanese will just ignore her. In the October Budget, the Treasurer can do whatever he likes on migration, and Albanese will ignore that too. Cheap student-migrant workers 4eva.

    • Jumping jack flash

      Maybe Keneally is working for the banks?

      The banks seem hell-bent on restricting debt growth, for what reason I have no idea. I can only assume it is a power play to harvest more free money and power from the government.

      It is curious that she would just get up and start shouting about lowering immigration and curbing wage theft – the only thing driving wages up and thereby driving debt growth. I’m sure she has a collection of IPs that need to rise in price too. Very curious.

    • For me the only question now is whether enough industries reliant on student/migrant workers be able to survive until internationals borders reopen. If not, it creates a feedback loop where potential migrants decide it’s not worth the risk and look elsewhere.

    • GlendaFMEMBER

      Actually they’re not, they’re just the same as all the others in the world, its just that they have a govt that has sponsored and encouraged the current situation for many decades….they’re just doing what they’re told and what they see working for others around them…..sheep…BAAAAAAA!!!!

  4. Lifting the TSMIT was one of the policies Labor brought to the last election, to 65k i believe.

  5. drsmithyMEMBER

    +1

    Self regulation – effectively what market testing is – never works.

  6. I sent a detailed collection of the key points on this topic (as collected mainly from MB articles and my own rants) to my local fed Labor members after joining a members Zoom meeting where I posted in the comments Q&A. It went over pretty well. The wheels seem to be slowly turning and my impression was the fear of being called the R word is now only just slightly edging out the gains that could be made pushing this kind of policy. I got a call back from the local fed member and we had a good chat about it and an invite to another meeting with another group of fed members where I will continue to raise again. I told the local fed member he should be checking out MB for great shovel ready ideas/ on the ground voter sentiment. If the MB team wanted to put their plan on a page for the nation I will happily put it to them- or even better MB can approach themselves.

  7. @Stuart, at the expense of sounding a bit droll. Who is your Federal Member? One, because I am stunned that they have contacted you & 2, because I wonder what their motive really is? I am a suspicious cynical type of person.

  8. Labuor market testing simply doesn’t work. It’s bollox through and through.