The Australia Institute demolishes skills shortage myth

The Australia Institute’s Richard Denniss and Matt Grudnoff have demolished the notion that Australia is experiencing chronic skills shortages, given there are nearly two million Australians unemployed or underemployed (video below).

They argue that if businesses want to attract workers there is a simple solution: 1) pay workers enough to make their unattractive jobs more enticing to workers; or train workers themselves with the necessary skills.

It’s an excellent video that explains in simple language why the skills shortage argument used by Australian businesses and the federal government is complete bunkum.

Curiously, however, Denniss and Grudnoff make zero mention of the Morrison Government’s plan to open the floodgates to cheap foreign workers, which would obviously weaken workers’ bargaining power, wages and conditions. In fact, they make no mention of immigration at all.

This is odd because Richard Denniss has highlighted the issue previously. For example here:

The incessant calls for an increase in skilled migration have drowned out genuine debate about the causes of any so-called ‘skills shortages’ and the range of policy options available to address them…

But rather than have a genuine debate about whether industry or government could be doing more to invest in the training of our young we are simply told there is no alternative but to import those skills from overseas…

Australia is a country of immigrants… But support for openness to immigration should not come at the price of having to remain silent about the size of our population.

Unlike the demands for more immigration from big business, Australian governments, state and federal, have found it easy to resist the demands for more hospitals, more nursing homes and more public transport…

Big business loves rapid population growth for the simple reason that they profit from having more potential customers. Governments seem to love rapid population growth because they benefit from having more taxpayers. But neither big business nor government wants to invest in the essential infrastructure that all those extra customers and taxpayers require. While the ‘benefits’ of a big population accrue in the form of profits and budget surpluses, the costs are borne by those stuck waiting in traffic, waiting for a hospital bed or waiting for a seat on the train.

And here:

The purpose of 457 visas is to suppress wage growth by allowing employers to recruit from a global pool of labour to compete with Australian workers. When demand for workers rises, employers need to bid against each other for the available scarce talent. It is only in recent years that the wage rises that accompany the normal functioning of the labour market have been rebranded as a “skills shortage”.

With lobby groups left and right demanding a return to pre-COVID levels immigration, and the Morrison Government planning to make it far easier for businesses to hire foreign workers via:

  • Abolishing labour market testing requirements.
  • Lowering costs and speeding up approval times for importing foreign workers.
  • Expanding the skilled occupation list to include almost any role.
  • Providing all ‘skilled’ visa holders with a clear pathway for transition to permanent residency.
  • Granting ‘skilled’ visa holders priority access to flights and hotel quarantine ahead of stranded Australians.

Why is The Australia Institute remaining silent?

The battle is taking place here and now. So why won’t The Australia Institute speak up against the Morrison Government’s planned wage crushing immigration reboot?

Unconventional Economist
Latest posts by Unconventional Economist (see all)


  1. BradleyMEMBER

    Had a day yesterday where I heard a lot of ABC radio and I think I heard at least 3 different reports in news and analysis programs stating what a disaster the non arrival of international students is and how things won’t improve until they come back. The usual suspects like Honeywood spouted off but it was the different journalists spinning the same line that made me think they were under orders.

    • ErmingtonPlumbingMEMBER

      One doesn’t need to receive orders from the leaders of the Neoliberal thought collective.
      Members are inculcated into having “proper thought” from the beginning of their careers.
      Its their only pathway to to professional success.

  2. happy valleyMEMBER

    “Why is The Australia Institute remaining silent?”

    They can see the writing on the wall as to freedom of speech after ScoMo wins the next election, so better have an each way bet?

    • Niall de Santos

      After the next election anyone who opposes mass immigration will be silenced under right wing anti-terror laws.

  3. The Institute has too many of their patrons, supporters and cohort of left leaning immigration boosters who could be offended if they question immigration levels.
    They are more likely to take cues from each other. They don’t want to risk being on the outer of their social strata. They are also apparently more likely keep their unpopular views to themselves for the same reason. That and constant proximity to each other makes it extraordinarily hard for authors/journalists.

  4. Jeez albo, what a bunch of (albo)dross. No – even nebulous – mention of investment in green energy, nothing.

    Wonder if others are sharpening the knives.

    Or else I’m wrong and they’re leaving announcements/policies till the last minute.

  5. kierans777MEMBER

    With Gabriela D’Souza going on Q&A next week, the ABC is shilling for the population Ponzi again.

    • @k77, & that G D’Souza will go the Q&A & she & no-one else will ask what & who she works for & whether she has a conflict of interest. They never do & never will.
      If you stood up in Q&A & asked why do we need a return to pre Covid NOM rather than a return to very long term NOM you’d either be left with blank faces or more likely taken out for a beating for being a racist.

  6. The “skilled” problem is the result of the Australian government reducing support for training the people here. The whole focus is on money – not the life of Australian people.

  7. Budget surpluses? Not in Vic or NSW. They are going into massive debt to build infrastructure to cope with recent population increases.