Restauranteurs prove immigration is used to suppress wages

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Fairfax is at it again, claiming the restaurant industry is facing a “critical shortage of chefs, managers and sommeliers” necessitating the return of foreign workers.

The usual arguments are put forward:

  • The entire sector’s pandemic recovery is at risk without immediate access to a foreign workforce.
  • More than 46,000 jobs are currently unfilled nationwide in the hospitality sector.
  • The departure of 600,000 temporary visa holders “threatens to be a handbrake on the speed of the country’s economic recovery”.
  • The Morrison Government has given the industry relief by allowing international students to work unlimited hours. It has also promised to provide the sector with a new class of foreign worker visa, the subclass 408 temporary activity visa.
  • Multiple restauranteurs claim they cannot find enough local workers to fill roles.

Not once in the biased Fairfax article did it mention that the Accommodation and Food Industry pays the lowest wages in Australia by a very large margin, which is maybe why it struggles to attract staff:

Hospitality industry median earnings

The Accommodation & Food Services industry pays the lowest wages in Australia.

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The article didn’t bother to ask the restauranteurs whether they had tried offering higher wages and training to entice locals into the industry.

Nor did the article mention that the restaurant industry is ground zero for migrant wage theft and exploitation.

The only shortage restaurateurs are experiencing are credibility, integrity, and the willingness to pay a living wage.

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Handing them greater access to foreign workers will only keep wages depressed, deprive Australians of job opportunities, and exacerbate the migrant wage theft that is already endemic across the industry.

Many economists and commentators assume that mass immigration has no effect on wages.

But the employers of imported labour are pretty clear that it keeps wages down.

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It shouldn’t be so difficult to have a sensible migration policy that isn’t designed to suppress wages.

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.