Welcome to the Jobs & Skills Destruction Summit

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In this week’s speech to the National Press Club, Prime Minister Anthony Albanese said that Australia needs to rapidly lift immigration because we are a “migrant country” and “we’ve got a globalised labour market, and we need to enhance our reputation”.

Albanese also attacked the former Morrison Government’s decision to send temporary migrants home during the pandemic, claiming it should instead have spent billions of taxpayers dollars providing JobKeeper, JobSeeker and Medicare so that they could stay:

“It probably wasn’t the wisest decision during the pandemic to tell everyone who was a temporary visa holder to leave, and to provide them with no income and no support, which means many of them have left with ill feeling towards Australia and that spreads around”…

Albanese’s criticism is more than a little Orwellian in light of Australia experiencing the best labour market conditions in generations, thanks largely to the collapse in immigration (temporary migrants) over the pandemic.

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Because there are around 400,000 fewer migrant workers in the economy than there otherwise would have been, Australia’s unemployment rate is now at its lowest level in 48-years, whereas Australia’s employment-to-population ratio is at an all-time high. So basically, Australia is experiencing close to full employment, with more Australians in jobs than ever before:

Australia's labour market

Best Australian labour market in generations.

However, rather than viewing Australia’s labour market as a triumph, and framing the Jobs & Skills Summit around how to keep unemployment at these low levels, the current labour market is being presented to the Summit as a “skills crisis” that necessitates the biggest immigration program in this nation’s history to drive unemployment higher. It is a direct assault on Australia’s working class, who will once again be forced to compete for jobs, housing and infrastructure against huge volumes of (mostly) poor migrants from developing nations.

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The Albanese Government made its intentions abundantly clear yesterday when Education Minister Jason Clare confirmed that the government is “considering extending the two-year work visa for completing international students to three or four years”, while fending off suggestions that Australia should target high quality international graduates:

[Clare] is yet to be convinced Australia should go down the UK pathway where students who score in the top 10 per cent are targeted for residency as part of a talent program.

Rather he is being advised Australia should target students who are committed to residency and to obtaining a local job…

Mr Clare is meeting with the expert members of the Council of International Education on Tuesday to develop a proposal to take to the Jobs and Skills Summit to reform visas for international graduates…

“A lot of those students are busy during the day and during the night, delivering us food or making coffee between classes.

“When they graduate they go home. It would be great if they stayed on and helped us fill some of those chronic skill gaps that we’ll be talking about later this week.

“Seems to me like a no-brainer.”

The former Morrison Government’s reforms late last year has already uncapped the number of hours that international students can work and now hands out two year Temporary Graduate work visas to Vocational Education and Training (VET) sector graduates. In turn, these changes have seen visa applications from non-genuine ‘students’ from India and Nepal explode, as these students seek to use the student visa system as a backdoor work visa before transitioning to permanent residency.

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Jason Clare’s proposed extension of work visas for completing international students to three or four years will obviously increase the incentive to ‘study’ in Australia for work rights and permanent residency, in turn flooding the nation with lower skilled workers from poorer nations. The end result will be exactly the same as pre-pandemic, when migrant wage theft ran rampant and local wages and conditions were trampled.

Finally, The AFR reports that the Albanese Government is only looking to lift the wage floor on temporary ‘skilled’ migrants to $65,000 – a level that is $18,000 below the median full-time Australian wage and $26,000 below the ACTU’s proposed $91,000 wage floor. Moreover, this timid lift in the wage floor will be in exchange for relaxing labour market testing, meaning employers will be able to recruit cheap, exploitable migrant labour unfettered:

There will also be mandated higher wages for skilled temporary migrants to stop them being used to undercut local workers, and possible in return for relaxing labour market testing.

The Australian Financial Review has reported the minimum wage for such a migrant will increase from $53,900, where it has been stuck since 2013, to $65,000.

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How can the Albanese Government seriously claim that Australia’s ‘skilled’ migration system is genuinely skilled when over half of these workers earn below the median full-time wage? The $65,000 wage floor without labour market testing will ensure that it remains an unskilled, low-wage system under Labor.

The above comes amid new research from the Co-director of University of Sydney’s mental wealth initiative, John Buchanan, which estimates that the share of workers getting on-the-job training has fallen from around a third in 2005 to around 20% currently.

Buchanan notes that employers have contributed to the lack of skilled workers because of poor planning around skills and training, and that it is this lack of training that has made Australia increasing reliant on ‘skilled’ migrants. The Albanese Government’s immigration agenda will only exacerbate these trends.

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Let’s be real: the Summit should be renamed the “Jobs & Skills Destruction Summit”, because that’s what it will achieve.

Labor’s ‘Big Australia’ immigration agenda will lift unemployment and further suppress wage growth, while exacerbating infrastructure and housing strains across Australia. It will drive another ‘lost decade’ for Australians (see here and here) where the economy and living standards stagnate in per capita terms, and productivity growth remains stillborn as migrants flood into low productivity ‘people servicing’ industries.

Australia's productivity growth

Productivity Commission: Australia’s productivity stinks due to over-reliance on low productivity services industries.

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It is another treasonous betrayal of Australian workers, only this time by a wolf in sheep’s clothing fake “Labor” Party that is just as beholden to capital as its predecessors.

With friends like the Albanese Government, Australian workers sure don’t need enemies.

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.