Report: Migrants are not plugging critical skills shortages

The claim that Australia’s 130,000 strong “skilled” permanent migrant program is alleviating critical skills shortages has been shot to pieces by a major new survey from the Bankwest Curtin Economics Centre, which finds that 53% of skilled migrants in Western Australia said they are working in lower skilled jobs than before they arrived, with underemployment also rife:

The underutilisation of the skills of independent skilled migrants is a human capital imperative with huge implications for skilled migration policy in Australia. Skilled migrants who are unable to find employment in their chosen occupation result in skills wastage and in the longer term skills atrophy. Just over half (53.1%) of respondents to the online survey indicated their current Western Australian (WA) job was of a lower skill level than the job they had prior to migrating…

The Australian labour market experiences a ‘mismatch’ in education levels where often migrants are overeducated for the job they are employed for because of inaccurate transferability international transfer of human capital, language barriers, discrimination and country-of-origin effect… Australian employment growth is largely driven by immigration, and foreigners are a prominent proportion of the labour force, so mismatch is an important issue that needs more attention in Australia…

The analysis of Census data shows the number of migrants (male and female) who were successful in finding full-time employment has radically decreased between 2006 and 2011 in WA. Over 55 per cent of male migrants and 27 per cent of female migrants occupied full-time jobs in 2006 while 41 per cent of male migrants and 18 per cent of female migrants in 2011 reported full-time employment status. The 2016 census indicated over 25 per cent of male migrants and 11 per cent of female migrants occupied full-time jobs…

Lead authors, Professor of International Health, Jaya Dantas, from the School of Nursing, Midwifery and Paramedicine, and Dr Ros Cameron, formerly from the School of Management at Curtin University, said the underutilisation of professional migrant skills remained a critical issue for the entire country.

“Australia has a long history of using migrants to fill skills gaps and labour shortages, but those skilled migrants face a range of barriers to both gaining employment and working in jobs that are in line with their qualifications and experience,” Professor Dantas said…

“Skilled migrants who are unable to find employment in their chosen occupation result in skills wastage, which can lead to being unable to support their families, economic hardship and, in some cases, potentially becoming a drain on government resources,” Professor Dantas said.

“Some of the examples of skills wastage included a former engineer now working in WA as a technician, a vocational school teacher turned cleaner and packer, a geologist working in aged care and a mechanical engineer employed as a security officer.”

The research found that the under-employment of skilled migrants contributed to health and wellbeing issues both at work and in the home, including feeling unfulfilled and undervalued.

This reports accords with research conducted in 2013 by Bob Birrell and Ernest Healy, which found that while 69.3% of Australian graduates aged 25-34 had managerial or professional work in 2011 and only 9.5% were not employed, only 30.9% of non-English-speaking-background [NESB] migrants who were graduates of the same age, who had arrived between 2006 and 2011, had managerial or professional work. And a full 31.1% were not employed. Most of this group of graduate arrivals (79%) were of NESB background:

It also helps to explain why the Australian Bureau of Statistics (ABS) latest Characteristics of Recent Migrants report, released in June, revealed that migrants have generally worse labour market outcomes than the Australian born population, with recent migrants and temporary residents having an unemployment rate of 7.4% versus 5.4% for the Australian born population, and lower labour force participation (69.8%) than the Australian born population (70.2%):

The Productivity Commission’s (PC) recent Migrant Intake Australia report also explicitly stated that around half of the skilled steam includes the family members of skilled migrants, with around 70% of Australia’s total permanent migrant intake not actually ‘skilled’:

…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…

The PC also showed that while primary skilled migrants have marginally better labour market outcomes than the Australian born population in terms of median incomes, labour force participation, and unemployment rates, secondary skilled visas, and indeed all other forms of migrants, have much worse outcomes:

So much for the “migrants are more qualified than the Australian born population” argument, which surely needs to be put to rest.

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