Business groups are calling on the Albanese Government to prioritise the issuance of skilled visas, claiming a 140,000 backlog of skilled migrant workers is costing the economy 0.5% in lost GDP:
Business Council of Australia chief executive Jennifer Westacott told The Daily Telegraph employers were struggling to source people for key skilled roles, which was preventing expansion and investment.
“We need a migration system that moves quickly because investment decisions for big projects or expansions can’t be put on hold indefinitely without Australians losing out on new jobs and new opportunities,” she said…
“Carefully targeted migration is critical to giving businesses rapid access to skills and workers so they can ramp up, expand, invest and create new jobs for Australians,” she said.
AMP chief economist Shane Oliver said even though the influx of hundreds of thousands of workers would drive demand…
“If all 140,000 applicants were let in for example, if you unleashed that backlog, it would probably be worth about 0.5 per cent of GDP,” he said…
Other visa categories are also experiencing a blowout in wait times, with 123,370 applications for parent visas still waiting a decision as of April 30.
We get it. More inputs in people means more outputs in GDP. It’s basic math. But will it increase GDP per capita, which languished badly in the decade leading up the pandemic as immigration boomed?
I say give the business lobby all the ‘skilled’ migrant workers they want on one condition: they must be paid well above the median full-time salary (currently $83,000, according to the Grattan Institute).
All the Albanese Government needs to do is set the migrant wage floor at the 75th percentile of median earnings, which was $94,120 as at August 2021 according to the ABS (see table below). Then let businesses have at it.
Alternatively, set the migrant pay floor 10% above the median full-time salary ($83,000), which is dragged down by unskilled workers.
Setting the salary threshold at these levels would ensure that businesses only hire migrant workers to fill highly skilled professions, while also eliminating the need for labour market testing or maintaining bogus skilled occupation lists.
By raising the quality bar, these reforms would reduce immigration flows, which is what Australians want, while maximising benefits to the economy and federal budget.
But business groups want Work Choices 2.0 instead
We all know the BCA and other business groups would never support this reform as it would undermine their goal of suppressing wages to maximise profits.
They instead want an expansion of the pre-COVID mass immigration model, which as Alan Kohler explained was “largely an industrial strategy designed to suppress wages and to protect the project they had to crush unions”.
Basically, the business lobby wants Australia’s immigration system to deliver them WorkChoices 2.0.
Hopefully, the Labor Government sides with unions over business groups on skilled visas. I am not hopeful, however, given Labor’s entire economics team – Jim Chalmers, Andrew Leigh and Andrew Charlton – are all pro mass immigration. Heck, Andrew Charlton was Kevin Rudd’s economics advisor when he declared that he believed in a ‘Big Australia’.