‘What did the inquiry look at?’

Essentially, the joint parliamentary inquiry – meaning it was made up of both House of Representative MPs and senators – was asked to look at whether the skilled migration program is working..

That includes whether the skills listed as part of the program are actually the ones we’re short on in Australia, how expensive it is for businesses to sponsor skilled migrants and generally how difficult the scheme is to navigate.

Currently, occupations with skills shortages include vets, chefs, civil and electrical engineers, and more.

The timing of the inquiry is also important.

Australia’s skills shortage was exacerbated last year with the sudden departure of migrants on temporary visas at the start of the pandemic.

How reliant is Australia on migrant workers?

It turns out, very.

Since March 2020, over half a million migrant workers have left Australia and according to many industries, the result has been significant gaps in the workforce.
Liberal MP Julian Leeser, who chaired the inquiry, said job ads were up 38 per cent from the beginning of the pandemic.

“There are many businesses around the country that just cannot find Australians who are skilled to do particular jobs,” he said.

Australia has benefited from migration for decades, and the sudden drop in migration thanks to border closures and the pandemic has added to the toll on the economy.

Industry leaders have been calling on the government to provide pathways during the pandemic to bring back skilled workers from overseas to help address the national shortage.

Ok, so what’s been recommended?

In the report that was tabled on Monday, the committee recommended a range of measures designed to smooth the pathway for temporary visa holders to stay in Australia longer-term.

One recommendation is that all “employer nominated visas” should provide the opportunity for permanent residency, provided applicants meet English language competency and are under the age of 45.

Employers can nominate their employees who hold temporary working visas for employer nominated visas, providing them the opportunity to live and work in Australia permanently and access benefits such as Medicare.

The committee also recommended prioritising regional workers by raising the age threshold from 45 to 50, capping English language requirements at vocational English, and reducing the number of years of previous experience required to two.

It suggested the government recognise the unique circumstance of the pandemic and create a more flexible system that can “adapt to emerging labour market needs”, including a more streamlined occupation list.

Currently, there are two lists – one for medium- and long-term skills needed, and one for short-term.
The inquiry also thinks there needs to be an increase to the minimum wage for migrant workers in non-regional areas, which is currently $53,900, but it doesn’t put a figure on what the new amount should be.

If it’s changed, it would be the first increase in the minimum wage for temporary skilled migrants in eight years.

What happens now?

Now that the committee’s officially handed back its report, it’s now up to the government to issue its response and detail whether it plans to adopt or reject the recommendations made.

“This report is really about not just addressing the skills migration during the pandemic but for after we’ve emerged from the pandemic,” Mr Leeser said.

Australian visas for pharmacists to be fast-tracked to support troubled vaccine rollout

The federal government will fast-track the visas of pharmacists to support the nation’s ongoing COVID-19 vaccine rollout.

Immigration Minister Alex Hawke announced the occupation would be added to the Priority Migration Skilled Occupation List (PMSOL), which outlines priority visa processing.

The decision comes as thousands of pharmacies across Australia are invited to join the vaccine rollout to help accelerate the program.

“With thousands of community pharmacies across Australia being invited to join the COVID-19 vaccine rollout, it’s all hands to the pump as the COVID-19 vaccine rollout continues,” Mr Hawke said.

The three new visa categories added to list include hospital pharmacist (251511), retail pharmacist (251513) and industrial pharmacist (251512).

This would result in priority visa processing for pharmacists across the hospital, retail and industrial sectors.

Currently, just over 16 per cent of the population in Australia has been fully vaccinated, with around 11 million vaccines administered across the country.

But the nation’s rollout has faced delays over the limited availability of Pfizer doses and changes in medical advice around the AstraZeneca vaccine.

The government says more pharmacies are set to join the nation’s rollout as demand grows for vaccinations due to the increased risk posed by the highly contagious Delta variant.

Last week, Health Minister Greg Hunt said 118 community pharmacies were providing vaccines across the country, with the number to increase to 470 by the end of the month.

From the start of this week, over 3,900 pharmacies who have indicated interest in joining the program were invited to come on board across regional and metropolitan areas.

“The Morrison government will support pharmacies across Australia, including through skilled migration, as supply of COVID-19 vaccine doses increases over the coming weeks,” Mr Hawke said.

The three additional occupations brings the Priority Migration Skilled Occupation List (PMSOL) to 44 in total.

All Australians are better off with increasing levels of immigration

It would be unfortunate if Reserve Bank governor Philip Lowe’s comments on the factors behind Australia’s weak wage growth are used to oppose a quick return to a significant immigration program once the nation’s borders open.

To the contrary, shortages in labour and materials are now providing a supply-side handbrake on the recovery. Reopening the borders and resuming international people flows, once the majority of Australians are vaccinated, will be critical to extending the recovery from last year’s COVID-19 recession.

As former Reserve Bank board member Warwick McKibbin stated: “Real wage growth is driven by productivity. Skilled immigrants raise economy-wide productivity.”
Australia’s modern immigration program is mostly skills-based. Skilled immigrants bring expertise, innovation and drive to the economy.

With a high wage floor and a solid welfare state, unskilled workers also are needed, frankly, to do the jobs that locals are loath to do, such as fruit picking.

Dr Lowe’s speech to the Economics Society this week was titled “The Labour Market and Monetary Policy”. It was very much in the context of the Reserve Bank’s plan to maintain near-zero interest rates and continue buying government bonds in order to generate enough demand to push the jobless rate towards 4 per cent, bid up wages, and get inflation back into target range of 2 per cent to 3 per cent.

It is good that increased competition makes business less inclined to jack up wages or prices not sustained by increased productivity.

But this is all about reviving inflation so that the central bank can then increase its nominal cash rate in time for the economy’s next downturn.

By itself, monetary policy cannot do anything to increase real wages. That all depends on productivity.
It may be true, as Dr Lowe says, that the pre-pandemic scope to draw upon foreign workers, including foreigners studying here, to fill labour shortages may have contributed to “wages being less sensitive to shifts in demand than was once the case”.

But, as with the resources boom of a decade ago, this is mostly a good thing.

As Dr Lowe says, it adds to potential labour supply – just as wider availability of childcare has helped drive the continued sharp rise in female labour participation.

It is good that increased competition from greater integration in global product markets makes business less inclined to jack up wages or prices not sustained by increased productivity.

The Reserve Bank’s own chart pack tells the real story of weak wages growth. Australian wages grew consistently by 3 per cent to 4 per cent a year from the 1990s to the end of the resources development boom almost a decade ago.

With inflation at 2 per cent to 3 per cent, the productivity reforms of the 1990s and then the China-fuelled export boom of the 2000s allowed real wages to grow steadily ahead of productivity growth and made all Australians more prosperous.

Dr Lowe says, turning down the tap of foreign labour would mean “less investment, less confident business, less output, lower capital stock and a less dynamic economy”.

Is there a case for a pandemic migration amnesty?

The pandemic has all but stopped immigrants arriving in Australia for the past 18 months and it could be sometime before the borders open again.

This will punch a hole in the country’s demographic planning that could take years to fill. Some experts say Australia will just have to “wear it”, others call for an amnesty to make up the numbers and some suggest partial solutions.

Australia’s two-tiered immigration system has provided some protection, as people who arrived on temporary visas before the pandemic are moved on to permanent visas through the skills and family streams.

But the reservoir of temporary visa holders is now running dry, and with new variants emerging, the date for opening the borders seems more uncertain.

The problem that may arise from low immigration is highlighted by the federal Intergenerational Report, which predicts reduced population growth will be the most enduring economic effect of the pandemic.
It predicts the country will be stuck in debt and deficit for the next 40 years unless it boosts skilled migration, workforce participation and productivity. The 2015 version of the report projected Australia’s population would hit 40 million by 2055. The new report downgrades that to 38.8 million by 2060.

While many people stranded in Australia during the pandemic have had new visas issued, unknown numbers of undocumented people are living below the radar and would likely be keen to become legal, use their skills and pay their taxes.

According to the Parliamentary Library, in the past Australia has had some migrant amnesties for people who were in the country irregularly, visa overstayers or those working in breach of their visa conditions. Broad amnesties were held in 1974, 1976 and 1980, mainly to manage undocumented people.

Lately, there have been calls for the government to shape an amnesty and designate a fixed period during which those who meet health, character and other requirements would be allowed to come forward and apply for a new status.