Skilled migrants are Australia’s working poor

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The Committee for Economic Development of Australia (CEDA) argues in a new report that the nation’s pool of skilled migrants is being underutilised.

CEDA’s senior economist, Andrew Barker, says recent migrants earn significantly less than Australian-born workers, and many are in jobs that are beneath their skill level.

“Recent migrants earn significantly less than Australian-born workers, and this has worsened over time”, Barker said.

“Weaker English skills and lack of skills recognition are preventing us from making the most of migrants’ skills and experience, with discrimination likely also having an impact”.

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“Many still work in jobs beneath their skill level, despite often having been selected precisely for the experience and knowledge they bring”.

The report shows that migrants who have been in Australia for two to six years earn more than 10% less than Australian-born workers on average.

Wages of recent migrants

It also suggests the migration system could be dragging down Australia’s productivity.

“Labour productivity and wages are closely linked, indicating that migrant labour is not being used as productively as it could be”, the report says.

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“This decade, migrants have become increasingly likely to work in lower productivity firms”.

Wage shortfalls of recent migrants

The report also shows that unemployment rates of recent skilled migrants are higher than Australian born workers:

Unemployment of recent skilled migrants
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Hilariously, higher educated migrants have the largest shortfall in earnings from Australian workers:

Migrant wage shortfall

Migrants are also far less likely to work in professional or managerial jobs:

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Migrants in professional and managerial jobs

The report notes that “English-language proficiency remains a significant factor explaining lower wages for recent migrants” as well as “for employment rates, labour-force participation rates, and hours worked”.

However, Australia’s migration system has shifted to non-English speaking nations, which has helped drive the poor employment outcomes:

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Migrants from NESB

CEDA contends that providing migrants with more English-language courses and making it easier for their overseas qualifications and experience to be recognised would help to address the skilled labour shortage.

The poor migrant wage outcomes outlined by CEDA above are supported by the latest Graduate Outcomes Survey (GOS), which shows that international graduate employment rates, participation rates, and median salaries are well below those of domestic graduates:

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Labour force outcomes

Source: Graduate Outcomes Survey (2022)

Disturbingly, Australia’s three largest source nations for international students – China, India and Nepal – each have poor labour market outcomes as measured by full-time employment:

FTE by home country

Source: Graduate Outcomes Survey (2022)

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All of this proves, yet again, that Australia’s purported ‘skilled’ visa system is a giant sham designed with one goal in mind: the development of a full-blown migrant underclass for chosen sectors to exploit.

Meanwhile, Australian housing and infrastructure continue to be crush-loaded by the migrant flood, forcing Australians into severe rental stress, group housing, or homelessness.

Before importing more migrant workers to solve purported ‘skills shortages’ and ‘skills mismatches’, migrants that are already here should be used more effectively.

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Stop the rot and stop wrecking Australia’s productivity and living standards.

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.