The OECD’s annual review of migration trends has revealed that Australia and New Zealand have the largest temporary migrant workforces in the world, which is raising competition for lower-income workers and suppressing wages:
Australia had almost 750,000 permits for temporary migrants on issue in 2017, second in total number only to the US. As a proportion of the overall population, Australia was also second behind New Zealand…
Measured in terms of their share of the local working population, Australia’s army of international students is the largest in the world…
Only New Zealand had a higher proportion of working holidaymakers than Australia. The OECD found if holidaymakers worked during their entire stay in Australia they would boost the total working population by 1.7 per cent…
The OECD’s employment, labour and social affairs director, Stefano Scarpetta, said… “high inflows of migrants into low-skilled jobs might damage the labour market prospects of young unskilled workers”.
Geneva-based Ms Burrow… said the level of wage theft in her home country was “unbelievable”…
“The theft of wages in this country is akin to the kind of conditions we see in countries like the Gulf states where the kafala system [of migrant workers] exists.”
Advertisement
Indeed, wage theft will not be addressed properly without reforming Australia’s visa system, given migrants are ‘ground zero’ for exploitation, usually by other migrants.
The number of temporary visas on issue in Australia has ballooned to more than 2.2 million, driven by a blow-out in international student visas and bridging visas:
The relatively recent availability of a large and vulnerable pool of temporary migrant workers has undoubtedly contributed to current record low levels of wages growth and a growing reluctance by employers to train local workers…
There have been a range of abuses uncovered which have clearly shown that the entire system is broken. From 7-11 and Domino’s to agriculture, construction, food processing to Coles, Dominos and Caltex, it is clear that the abuses occur in a number of visa classes whether they be students, working holiday makers or visa workers in skilled occupations…
Australia has created a massive industry with many migration agents outside of our jurisdiction who cannot be prosecuted for breaches. This mushrooming “migration industry”- a complex and transnational web of agents, lawyers, labour recruiters, accommodation brokers and loan sharks – is currently largely unregulated.
The growth of labour hire operators alongside the migration industry has led to companies seeking to sell temporary migrant workers to employers, creating a fake “Job Network” which preferences temporary workers over Australians.
Over the 10 year period from August 2009 to August 2019, the number of people on migrant visas increased by 31%, from 355,380 to 466,113.
Most of the increase was due to growth in the number of work and student visas being issued, while residence visas have remained reasonably flat.
In the 10 years from August 2009 to August 2019, the number of work visas issued increased from 87,138 a year to 193,311 a year (+122%). Student visas increased from 58,398 a year to 84,552 (+45%), while residence visas declined from 207,966 a year to 186,741 a year (-10%) over the same period:
“…exploitation of migrant workers is pervasive in New Zealand… migrant workers continue to report high levels of abuse, intimidation, underpayment, debt bondage, and a host of other exploitative employment practices… it is the same industries—dairy farming, fishing, hospitality, horticulture, construction, and international education—that keep coming up as the most exploitative… migrant exploitation has a chilling effect on wages and conditions for all workers in those sectors… too many employers rely on exploiting migrant workers so that they can avoid paying decent wages and meeting basic employment standards”…
Advertisement
Amazingly, this week Iain Lees-Galloway opened the visa floodgates by allowing New Zealand employers to import cheap foreign workers en masse, while also subsidising schooling for children of temporary visa holders:
The Government has announced plans to make it easier for employers to bring temporary workers into the country…
Lees-Galloway says the new rules “will assist around 25-30,000 businesses get the workers they need to fill skills shortages”…
“For those paid above the median wage [$52,000] and in the parts of the country where there are fewer New Zealanders available there will be no labour market test”…
The Government will reinstate the ability for lower-paid foreign workers to support their partner and children to come to New Zealand for the length of their visa. This was restricted in 2017…
Dependent children of a lower-paid worker will have access to primary and secondary education as subsidised domestic students.
New Zealand employer groups could hardly contain their delight at the visa changes, as captured by the morning Newsroom article:
Advertisement
As soon as the embargo lifted on the Immigration Minister’s announcement on Tuesday, positive press releases flooded in from industry associations whose employers rely on imported labour, including Federated Farmers, Horticulture NZ, Business NZ and New Zealand Aged Care Association.
They see it as a win for employers who will be able to employ overseas workers with greater ease.
Thus, after lambasting the former National Government for ignoring the systemic exploitation of migrant workers, Iain Lees-Galloway has expanded the opportunities for such exploitation, while also throwing Labour’s traditional constituents – the working class – under the bus.
Indeed, Interest.co.nz’s David Hargreaves believes that the visa changes implemented by Labour could facilitate modern day slavery:
Advertisement
The fact that it will be employer-driven is hugely problematic…
If we look at recent history it is employer-driven ‘temporary’ migration that has in some circumstances led us to witnessing – and I will use that very charged word – slavery. Yes, there have been documented cases of would-be migrants, desperate to get a foot in the door in New Zealand, being treated effectively as slaves…
And we know full well from the recent past that “temporary” has simply been the code for “foot in the door” that leads to application for more permanent residency…
People come into the country to do low paid jobs, get to stay here and end up being here permanently…
Both Australia and New Zealand are effectively running low-skilled mass immigration programs that facilitate slavery and exploitation, while also crushing the wages, employment opportunities, and living standards of incumbent workers.
The big winners from this system are the capitalists, which profit from inflated land values and an ever-growing customer base.
Advertisement
Jacinda Ardern’s Labour Government should be marched to the gallows for pandering to the business lobby and betraying its working class base.
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.
