Coalition reignites immigration ponzi


Acting immigration minister, Alan Tudge, has released a new ‘skilled’ migration plan supposedly aimed at boosting population growth, creating jobs and helping the economy recover from the COVID-19 recession:

Most of the 17 jobs on the new list of workers that businesses will be able to sponsor from overseas relate to the medical industry, including registered nurses, general practitioners, psychiatrists and midwives, but chief executives, construction project managers, mechanical engineers and software engineers also make the list…

“If a person fits that category [on the list] they will get an exemption to come through the borders,” Mr Tudge said…

He acknowledged there could be some concerns from the more than one million Australians whose jobs were lost within the first six weeks of shutdowns to limit the health effects of the pandemic but said historically strong migration meant GDP growth and per capita growth…

“Immigration is actually part of that answer of getting Australians back into work because some people are job-creating individuals,” Mr Tudge said. This could include significant investors, entrepreneurs who create businesses or workers with highly specialised skills needed by businesses…

“Migration has been obviously an important driver of population growth. That alone is a significant economic driver. But migration has also helped our participation rate and our productivity rate because we bring in young and skilled people.”

“It’s a very significant part of Australia’s economic and social success. Australia is an immigrant nation and we will return to being an immigrant nation”…

Minister for Employment, Skills, Small and Family Business Michaelia Cash said businesses would still have to advertise with two national classifieds outlets to prove there was a shortage of local workers able to fill the role…

“The occupations were chosen after careful analysis of recent changes to the internet vacancy index, changes in employment, and longer-term stability in the labour market for individual occupations,” Senator Cash said.

A quick glance at the federal government’s own skills shortage list reveals that most of these occupations were not actually in shortage before COVID-19 hit, and are therefore less likely to be in shortage now.

Research a few years back also showed that Australia was awash with overseas trained doctors (OTDs), prompting both the Australian Medical Association and the Department of Health to seek the removal of dozens of health roles from the official skills shortages list, which was ignored by the Coalition.


The latest skills shortage report from the federal government also confirms that there is no shortage of nurses:

While there were differences by specialisation, in 2017-18, employers generally filled their nurse vacancies with relative ease. In 2017-18, 72% of nurse vacancies were filled and there was an average of 7.2 applicants per vacancy. These results are fairly consistent with those experienced over the previous three years (see Figure 1)…

The supply of nurses has increased in recent years, with nursing graduate numbers and nurse registrations at historically high levels.

And what about the immorality of stripping developing nations of their medical expertise?


The biggest laugh must be reserved for construction project managers. With apartment and university projects collapsing across Australia, many of these people will already have been made redundant. Now they will have to compete with fast tracked visa holders. Seriously?

Moreover, what a crock of confusing, contradictory waffle this statement by Tudge is:

He said getting Australian citizens and residents back to work was the government’s “number one objective”.

“Immigration is actually part of that answer of getting Australians back into work because some people are job-creating individuals,” Mr Tudge said. This could include significant investors, entrepreneurs who create businesses or workers with highly specialised skills needed by businesses.”


Did anyone notice “significant investors and entrepreneurs” on the list of skill shortages? Nope.

Further, Tudge’s statement that “migration has also helped our participation rate and our productivity rate because we bring in young and skilled people” is easily debunked. If Tudge had bothered to look, he would have realised that Australia’s purportedly ‘skilled’ migration system is actually a low-paid rort that undercuts Australian workers and productivity.

The proof is in the pudding.


Let’s first examine Australia’s permanent migrant system, which is currently set at 160,000 non-humanitarian places and around 16,000 humanitarian places; although neither of these targets will be hit given COVID-19:

Within this 176,000 strong permanent target are 109,000 places under the ‘skilled stream’, which is where the superficial claim that Australia’s immigration program is skills-based comes from.

Digging into these superficial figures reveals a permanent migrant program that is, in fact, mostly unskilled.


First, as noted in the Productivity Commission’s 2016 Migrant Intake into Australia report, half of the skilled stream comprises the family members of the primary skilled migrants:

…within the skill stream, about half of the visas granted were for ‘secondary applicants’ — partners (who may or may not be skilled) and dependent children… Therefore, while the skill stream has increased relative to the family stream, family immigrants from the skill and family stream still make up about 70 per cent of the Migration Programme (figure 2.8)…

Primary applicants tend to have a better fiscal outcome than secondary applicants — the current system does not consider the age or skills of secondary applicants as part of the criteria for granting permanent skill visas…

Second, the median pay of Australia’s permanent migrants is actually well below the population average, whereas unemployment is higher, according to the Department of Home Affairs’ Continuous Survey of Migrants:


As shown above:

  • The median annual full-time earnings of migrants was $16,500 (22%) below the general population in 2017;
  • The median annual earnings of migrants was $5,900 (10.2%) below the general population in 2017; and
  • The unemployment rate of surveyed migrants (12.6%) was more than double the general population (5.5%) in 2017.

Even if we focus on the skilled stream only, both median earnings and unemployment is far worse than the general population:


According to the ABS’ Characteristics of Recent Migrants, November 2019 survey, migrant unemployment is also far higher than the Australian born population:


As shown above, 6.6% of recent migrants were unemployed as at November 2019, versus only 4.7% of Australian born persons.

The story is no better for Temporary Skills Shortage (TSS) visas. The Temporary Skilled Migration Income Threshold (TSMIT) has been frozen at the ludicrously low level of $53,900 since 2013-14. This is $3,300 (6%) below the median income of all Australians ($57,200), which includes unskilled workers, according to the ABS:


Thus, the TSMIT has also incentivised employers to hire cheap migrants instead of local workers, as well as abrogated the need to provide training.

These are shocking results. Skilled migrants are purported to be highly qualified and brought into Australia to overcome ‘skills shortages’.

These ‘skilled’ migrants should, therefore, be paid well above the general population, which comprises both skilled and unskilled workers, as well as have very low unemployment.


The fact that ‘skilled’ migrants are paid less, and suffer higher unemployment, is a damning indictment of Australia’s purported ‘skilled’ immigration system, and is bonafide proof that it is undercutting local workers.

Thus, Australia is not running a skilled migration system at all, but a defacto low-skilled system that is depressing wages, crush-loading cities, diluting our resources base, and eroding overall amenity for existing residents.

If Tudge had a shred of integrity on this issue, he would require that all skilled migrants (both temporary and permanent) be employer-sponsored (given their far better employment outcomes – see above charts) and paid at least at the 75th percentile of earnings (preferably higher).


This would ensure that the skilled visa scheme is used sparingly by businesses to employ only highly skilled migrants with specialised skills, not abused by businesses as a tool for undercutting local workers and eliminating the need for training.

Of course, integrity is not the goal here. It is all about driving another influx of “cheap” labour and property demand to increase profits for the Big End of Town, the biggest supporters of these charlatans.

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.