Last month, Australian journalist Matt Bell published the following article on the nation’s purported “skills crisis.”
This was based on a report from recruitment firm Hays, which found that 85% of hiring managers grappled with “skills gaps” that continue to worsen despite a softer market and historically strong immigration.
However, as shown recently by Greg Jericho, Australia’s purported labour shortages were not because of a lack of applicants. “There are a lot more people applying for each job”.
Rather, it was because of a lack of “qualified and suitable candidates applying for jobs”.
A new report from JobAdder backs this view. It shows that the number of job applications surged 47% in 2024, making competition tougher than ever.
The average job in Australia attracted a series high 41 applicants in Q4 2024.
Source: JobAdder
JobAdder also noted a shift toward temporary roles (81% of placements) over permanent positions, which has left job seekers in limbo.
Source: JobAdder
SEEK’s latest employment report also showed a massive rise in the number of applications per job ad.
The majority of Australia’s purported ‘skilled migrants’ work in low-skilled jobs unrelated to their education.
The Committee for Economic Development of Australia (CEDA) examined the most recent census, which revealed that Australia’s ‘skilled’ migrants are chronically underemployed and underpaid.
“Recent migrants earn significantly less than Australian-born workers, and this has worsened over time”, CEDA senior economist Andrew Barker said.
“Many still work in jobs beneath their skill level, despite often having been selected precisely for the experience and knowledge they bring”.
The CEDA analysis also highlighted that Australia’s migration system may be contributing to the country’s low productivity growth.
“Labour productivity and wages are closely linked, indicating that migrant labour is not being used as productively as it could be”, the report said.
“This decade, migrants have become increasingly likely to work in lower productivity firms”.
According to Adelaide University’s George Tan, 43% of skilled migrants who exploited the state-sponsored visa system were not working in their stated occupation.
The majority of skilled migrants worked in retail, hospitality, and service management and were overqualified.
Deloitte Access Economics uncovered that 44% of permanent migrants in Australia were working in jobs below their skill level in 2023. The majority of these underemployed migrants entered through the skilled stream.
Deloitte projected that over 620,000 permanent migrants work below their skill levels and credentials. Of these, almost 60%, or 372,000, entered the skilled migration system.
On average, among those permanent migrants who arrived in Australia in the last 15 years, almost half (44%) are working in an occupation at a lower-skill level than is commensurate with their qualifications (Chart 1).
This means in 2024, there are more than 621,000 permanent migrants living in Australia who are underutilised and not working to their full potential.
Despite the permanent migration program’s focus on attracting overseas qualified professionals with skills in demand that address labour shortages, almost six in ten underutilised permanent migrants in Australia entered via the skills stream.
According to the federal government’s 2023 Migration Review, 51% of overseas-born university graduates with bachelor’s degrees worked in unskilled employment three years after graduating.
Source: Migration Review (2023)
The Graduate Outcome Survey has also regularly revealed that student graduates earn significantly less than locally born graduates and have poorer labour market outcomes.
What additional evidence is required to demonstrate that Australia’s migration system is failing to produce the outcomes that have been promised?
Mass immigration has failed to bring the necessary skills, resulting in persistent infrastructure and housing shortages, as well as environmental damage.
The best option is to run a smaller, more skilled, and well-paid migration system.
The wage floor for all skilled visas should be set far higher than the median full-time salary (now around $90,000). All skilled visas should also be employer-sponsored, allowing qualified migrants to begin working in their field of competence immediately.
All types of retirement visas, including parental and ‘golden’ tickets, should be abolished.
The failures of Australia’s migration system cannot be overlooked. Australia is depriving poor countries of talent while exacerbating domestic skills, housing, and infrastructure shortages.
