Immigration and the Aus Labour Market

8/6/2019 Immigration and the Aus Labour Market

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Australia is an immigration nation, a settler immigration

society where immigrants comprise a greater proportion of the

population than in any other major western nation (OECD,

2008). One in four Australians today are rst generation

immigrants, while rst and second generation immigrants

comprise the majority (between 50 and 60 per cent) of the

populations of Australia’s cosmopolitan cities such as Sydney,

Melbourne, Brisbane and Perth. Australia, with the USA,

Canada and New Zealand, is one of the few western countriesto have actively pursued a settler immigration policy over the

six decades following the end of World War II. In the post-1945

period, about 6.4 million immigrants have arrived in Australia,

with immigrants a major component of the Australian population

increase from seven million to over 20 million. About one

million migrants arrived in each of the four decades following

1950: 1.6 million between October 1945 and June 1960; about

1.3 million in the 1960s; about 960,000 in the 1970s; about

1.1 million in the 1980s and 900,000 in the 1990s. Today

immigration contributes about half of Australia’s population and

workforce growth (Productivity Commission, 2006: xv–xvi).

This immigration policy was partly established to ll

labour shortages, and partly to add to Australia’s population

(Collins, 1991: 77–92). The Australian immigration cycle was

closely synchronised with the business cycle. This has led to

immigration intakes peaking at the end of the rst (1947 to late

1960s) and second (1992–2008) post-war economic booms,

while immigration intakes were cut considerably after theeconomic recessions of 1974–1975, 1982–1983 and 1990–1991,

as unemployment rose. The lowest number in any one year was

52,752 in 1975–1976. The Australian demographer, Charles

Price, used the metaphor ‘boa-constrictor’ to generate the image

of the Australian economy as a hungry immigration snake with a

great appetite for immigrants during the boom period, dropping

off during periods of recession.

Post-war Australian immigration policy has thus been primarily

labour market driven, with migrants an imported reserve army

of labour to ll labour market shortages in specic occupations

and regional areas, though as a settler immigration country, likethe USA, Canada and New Zealand, immigrant families rather

than individual workers were sought.

Immigration And The Australian Labour Market

By Jock Collins,Professor of Economics and Co-Director,

Cosmopolitan Civil Societies Research Centre, University of Technology, Sydney (UTS)

the early 1990s: immigrant settler arrivals numbered 76,300 in

1992–1993 and rose consistently in subsequent years to over

150,000 in 2007–2008. However, these gures do not include th

temporary migration intake. When the permanent and temporar

migration intakes are added, 2008 becomes the new high water

mark of post war immigration, responding to the lowest levels

in Australian unemployment in thirty years of 4.4 per cent.

Table 1: Australian immigration intakes 1991–2 to 2004–5

Settler arrivals and net immigration

Settler Arrival Numbers Net Permanent Migratio

1991–1992 107,400 78,300

1992–1993 76,300 48,400

1993–1994 69,800 42,500

1994–1995 87,400 60,500

1995–1996 99,100 70,500

1996–1997 85,800 55,900

1997–1998 77,300 45,300

1998–1999 84,100 49,000

1999–2000 92,300 51,200

2000–2001 107,400 60,800

2001–2002 88,900 40,700

2002–2003 93,900 43,500

2003–2004 111,600 52,500

2004–2005 123,400 60,800

2005–2006 132,600 63,700

2006–2007 140,418

2007–2008* 142,800 – 152,800

Source: <http://www.immi.gov.au/media/fact-sheets/02key.htm(accessed 15 September 2007) *planned intake range.

STUDENT ACTIVITIES

1. a. Explain the relationship between population growth and the

supply of labour.

b. Using a production possibilities curve diagram, illustrate the

impact of an increase in the labour supply on the level of

production in an economy.

2. Discuss the likely impacts of labour shortages on the level of

output and income in an economy. Illustrate your answer with

examples drawn from the Australian economy.

3. a. Using the statistical data in Table 1, examine the link between

the rate of economic growth in the domestic economy and the

number of migrants entering the country.

b C h ib i f i i h i h



The era of globalisation that has accompanied the second

Australia post-war economic boom and changed the structure

of the Australian economy has led to signicant changes to the

composition of immigration intakes (Collins, 2008). There have

been four major, interrelated, immigration policy initiatives in

response to globalisation and the long boom that it generated.

The rst , as Table 1 has shown, has been to signicantly

increase permanent immigration intakes over the past decade,

responding to the business cycle. The second has been to ne-

tune the permanent immigration programme to better respondto new labour market shortages, with increasing emphasis on

skilled and professional migration rather than family migration

which dominated immigration intakes in the 1950s and 1960s.

An occupation-in-demand list was used by the Immigration

Department to match immigrant applicant with areas of skilled

labour market shortage. The third has been to dramatically

increase temporary migration. The fourth major change is related

to the geopolitical shifts that followed the events of 9/11, raising

the importance of the security aspects of immigration, particularly

in relation to undocumented immigrant arrivals or ‘boat people’.

Table 2 shows immigration intakes for the period 1998–1999 to2006–2007, indicating the increase in the skilled labour intake

relative to the family intake over that period. While 29 per cent

of permanent immigrants arrived on skilled visas in 1995–1996,

skilled migrants comprised 66 per cent of the 2005–2006 intake

(Productivity Commission, 2006: xxiii). While most of these

skilled vacancies are in Australian cities, regional and rural areas

also faced severe skill shortages during the second post-war

boom. New visa pathways were introduced earlier this decade to

attract skilled immigrants to ll labour shortages in regional and

rural Australia (National Farmers Federation, 2008).

Table 2: Australian Immigration Intakes 1998–99 to 2006–7by Category of Entry

Category 1998–99 2000–01 2002–03 2004–05 2006–07

Family 21,501 20,145 28,000 33,182 37,138

Skilled 27,031 35,715 38,504 53,133 60,755

Total* 84,143 107,366 93,314 123,424 140,148

Source: <http://www.immi.gov.au/media/publications/statistics/

settler-arrivals/settler-arrivals-0607.pdf> (Accessed 20

November 2007)

* Also includes humanitarian and New Zealand

immigration intakes.

While much of the debate about Australian immigration has

centred on permanent or settler immigration, the growth in

long-term temporary immigration has gone relatively un-

noticed. As Graeme Hugo (2003) has noted, in 2001, for the

rst time, the number of people who were granted long-term

visas to work in Australia – that is, temporary immigrants –

exceeded the number granted permanent immigration entry.

The increasing importance of long-term temporary immigration

can be gleaned from the fact that, between 1982 and 2000, the

growth in permanent immigration to Australia was 11 per cent,

while temporary intakes soared: long term residents grew by 65

per cent and long-term visitors grew from 30,000 to 133,000

(Macken, 2003). A range of new visa categories was introduced

to assist with this explosion of temporary migration to Australia

and international relations. In 1997–1998, 125,705 temporary

resident visas were issued. By 2005–2006, 224,962 temporary

resident visas were issued: 74,666 in the skilled stream, 27,782

in the social/cultural stream and 122,514 in the international

relations stream.

The impact of this increase in temporary migration to Australia

can be seen in the increasing proportion of temporary migrants

in the Australian population: in 1992 they comprised 0.23 per

cent, in 1997 0.44 per cent, and in 2002 0.65 per cent of the

total population. This gave Australia a smaller proportion of

temporary migrants than New Zealand (1.61 per cent), but a

higher proportion than Germany (0.42 per cent), Canada (0.28

per cent), the USA (0.23 per cent), the UK (0.25 per cent),

Japan (0.16 per cent) and France (0.04 per cent) (Australia

Productivity Commission, 2006: 208). Temporary migrants ha

helped Australia ll vacancies for skilled employment generate

by the second post–war boom.

Dutch Immigrants 1954

Recent arrivals

Source: Wikipedia Commons

However, temporary migration has been accompanied by

employer abuse and exploitation, particularly for those who ent

under the 457 visa. This visa category has grown dramatically

in the past decade. In 1997–1998 just over 30,000 subclass

457 visas were granted, including less than 20,000 primary

applicants. By 2007–2008, 110,570 subclass 457 visas were

granted, with over 58,000 to primary applicants (DIAC, 2008a)

Reports of unsafe working conditions (leading to a number of

temporary migrant deaths) and exploitation of 457 workers in

terms of low wages and long hours of work began to proliferatein the media. This lead to strong trade union opposition and,

eventually the establishment of a review of the temporary



recommended that 457 Visa workers have the same wages and

conditions of employment as other workers, that a ‘salary oor’

be introduced to reduce the exploitation of these temporary

workers (DIAC, 2008b: 7–8) and that a severe tightening of

its operation be introduced to minimise the exploitation of

temporary immigrants with 457 visas.

Like permanent immigration, temporary migration has been

limited to skilled workers. However, in recent years many

unskilled and semi-skilled jobs could not be lled, including

100,000 jobs in the regional and rural sector. The Rudd

government accepted the argument of the World Bank and

followed the example of the New Zealand government to open

the door to a trial intake of unskilled Pacic Island workers to

ll labour shortages in the Australian bush. The World Bank

had argued that their remittances would play an important role

in assisting the economic development of these countries while,

at the same time, lling job shortages such as fruit picking

that could not be lled. In March 2009 the rst trial intake of

these workers arrived in Australia with an undertaking that they

would be employed only in cases where no Australians could be

found to ll these jobs.However, with increasing skilled migrant intakes comes the

problem of the recognition of education and employment

qualications not obtained in Australia. Critics argue that the

overseas qualications of immigrants from non-English-speaking

are often undervalued in Australia, that assessment criteria are

outdated and not sufciently exible, are too complex and often

lead to racial discrimination (Productivity Commission, 2006:

176–186). This is one of the enduring contradictions of Australian

immigration policy (Hawthorne, 1994; Iredale & Nivison-Smith,

1995). As a result, many of those who arrive with skilled migrant

visas cannot nd work in Australia utilising these skills, often

resulting in downward mobility of new immigrants, hardship for

their families and a decline in the performance of the Australian

economy. It is a cruel irony that these immigrants are often

scapegoats for problems with Australia’s economic performance

(Castles et al., 1998; Collins 1991).

One major contradiction of globalisation is that while

international immigration has increased signicantly in recent

years (Castles and Miller 2009) the internationalisation of labour

has not kept pace with the internationalisation of capital and trad

(Legrain 2006). This is because immigrants have a social presen

in their host societies. Social conict, riots, crime and other socia

contradictions linked to the cultural diversity that accompanies

immigration constrains attempts to make labour as mobile as

capital, particularly post 9/11 because of security concerns.

Controversies related to Middle Eastern crime and criminal gang

(Collins et al 2000), the Cronulla riots of December 2005 (Collin

2007) and development applications for new Islamic schools

and mosques have been the latest expression of the racialisation

of immigrant minorities, particularly in Sydney where most of

Australia’s immigrants from the Middle East live.The current nancial crisis has become a crisis of contemporary

capitalism, the ultimate contradiction of globalisation. No country

appears to be immune. The second post-war economic boom,

fuelled by globalisation, has been undermined by it. Economic

recession in Australia is inevitable: it will be deep-seated and

prolonged. It seems inevitable that unemployment will exceed th

of earlier international post-war recessions. Australian immigratio

history shows that immigration levels are increased during period

of economic boom and reduced during periods of economic

recession. As unemployment rises in Australian and other

countries, increasing social conict related to immigrant minoritiappears to be inevitable. It is not a coincidence that the rst majo

national debate of immigration and multiculturalism was ignited

by Geoffrey Blainey in 1984, immediately following the 1982–

1983 recession when unemployment rates reached double gures

in Australia for the rst time since the 1930s. Blainey (1984)

argued that immigrants were taking ‘our jobs’ and that social

conict would occur in the ‘frontline suburbs’ where Asian and

other immigrant minorities lived. In the aftermath of the 1990–

1991 recession, Pauline Hanson’s One Nation party had a dramat

rise to political inuence, drawing on economic insecurity to fuel

support for anti-immigration and anti-Aboriginal policies.

Just as it has taken some years for Australian immigration intake

to increase signicantly during the period of economic recovery

from 1991 to the present, so to will it take some time for the

current record levels of immigration to fall. Immigration policy

is not a short-term macroeconomic policy lever capable of quick

reduction and ne-tuning. It is more like a large oil tanker than

a speedboat, taking a long time to turn around. If this current

crisis of international capitalism is as bad as most commentators

suggest, critics of both immigration and multiculturalism will

have a eld day as they point to the negative economic, social

and environmental consequences of immigration. Immigrant

minorities will bear the brunt of unemployment as a consequencof this crisis, just as they have in previous recessions. At the

same time a resurgence of far-right commentators and political

Cronulla riots (2005)



STUDENT ACTIVITIES

4. a. Examine the statistical data in Table 2 and describe how the

composition of Australia’s migrant intake has changed.

b. Suggest reasons for the trend in Table 2.

5. a. What is a ‘temporary immigrant’?

b. How have the numbers of temporary immigrants changed over

recent decades?

6. a. Outline some of the problems associated with the changes in

the level of temporary migration over the past decade.

b. What has been the response of stakeholders to these problems?c. Research activity. What is a 457 visa and why has the

popularity of this visa category grown dramatically in the past

decade?

7. How has immigration been affected by globalisation?

8. a. The World Bank has identied the economic benets of

temporary migration of skilled and unskilled workers.

What are they?

b. How did the Australian government respond?

9. Create a tabular summary of the costs and benets of migration

described in the article. Include reference to both economic and

social effects.

10. Assess how effective the government’s immigration policies have

been in addressing our labour market shortages.

ReferencesBlainey, Geoffrey (1984) All For Australia (North Ryde, NSW: Methuen Haynes).Castles, S, Foster, W, Iredale, R and Withers, G (1998) Australia and

immigration: Myths and Realities (Sydney: Allen & Unwin). Castles,S. and Miller, M. 2009, The Age of Migration: International Population Movements in the Modern World , 4rd edn. Macmillan, London

Collins, Jock (1991) Migrant Hands in a Distant Land: Australia’s Post-war Immigration (Sydney and London: Pluto Press).

Collins, Jock (2007). ‘The Landmark of Cronulla’ in James Jupp and JohnNieuwenhuysen and (eds) Social Cohesion in Australia. CambridgeUniversity Press, Cambridge and Melbourne, pp.61–69.

Collins, Jock (2008). ‘Globalisation, Immigration and the Second Long Post-

war Boom in Australia’ Journal of Australian Political Economy, Numbe61 June 2008 pp. 244–266.

Collins, Jock, Noble, Greg, Poynting, Scott and Tabar, Paul (2000) Kebabs,Kids, Cops and Crime: Youth Ethnicity and Crime (Sydney: Pluto Press).

Department of Immigrating and Citizenship (2008a) Visa SubClass 457

Integrity Review: Issue paper #3 Integrity/Exploitation, <http://www.immgov.au/skilled/skilled-workers/_pdf/457-integrity-review-issue-3.pdf>

(accessed 16 February 2009).Department of Immigrating and Citizenship (2008b) Visa SubClass 457

Integrity Review: nal Report , October 2008, <http://www.immi.gov.au/skilled/_pdf/457-integrity-review.pdf> (accessed 16 February 2009)

Hawthorne, Lesleyanne (1994) Labour Market Barriers for Immigrant Engineers in Australia , Bureau of Immigration and Population Research,(Canberra: Australian Government Publishing Service).

Hugo, Graeme (2003) ‘A New Paradigm of International Migration Between European Union and Australia: Patterns and Implications’, paper prepared

for The Conference on the Challenges of Immigration and Integration inthe European Union and Australia, University of Sydney, 18–20 February

Iredale, Robyn and Nivison-Smith, Ian (1995) Immigrants’ Experiences of Qualications Recognition and Employment: Results from the Prototype

Longitudinal Survey of Immigrants to Australia (LSIA) (Canberra,

Australian Government Publishing Service).Legrain, Philippe (2006) Immigrants: Your Country Needs Them, Little, Brow

London.Macken, Deirdre (2003) ‘Talent in Transit: The New Migratory Pattern’, The

Weekend Australian Financial Review, 22–23 March, pp. 26–7.National Farmers Federation (2008) 2008 Labour Shortage Action Plan: An

ongoing plan investigating new and existing solutions to agricultural laboushortages, their practical implementation and policy solutions, March2008, <http://www.innovation.gov.au/innovationreview/Documents/674(L)National_Farmers_Federation_Supporting1.pdf> (accessed 4 February 200

Productivity Commission (2006) Economic Impacts of Migration and Population Growth: Final Report , Australian Government ProductivityCommission, Canberra, April.

Australia’s EmissionsTrading Framework

By Ann Hodgkinson

Faculty of Commerce (Economics), University of Wollongong, NSW

Why Should Australia ReduceGreenhouse Gas Emission?

Impact of global warming on Australia

Global warming will have particularly severe impacts on theAustralian economy and society in general. These impacts

include increased severity and frequency of natural disasters

such as storms, wind gusts, localised ooding, rising sea

levels and storm surges, and bushres. These events result in

increased insurance costs, deaths and injury, loss of houses,

motor vehicles, public infrastructure and livestock. It has also

been linked to increased frequency and severity of drought

that has impacts on gross domestic product (GDP) growth

and exports as well as increased costs of supplying urban

water due to the need to develop expensive alternative water

sources. There will be particular impacts on areas such as theMurray Darling Basin and south western Western Australia,

with resulting declines in agricultural output, farm incomes

the spread of diseases such as dengue fever. There will also b

signicant impacts on the habitats of many native plants and

animals, including threats to landmark areas such as the Grea

Barrier Reef, wet tropic areas, Kakadu, the Australian Alps,

south-western Australia (a biodiversity ‘hot spot’) and the

sub-Antarctic islands (Garnaut 2008, Table 6.2, pp.127–128;

Australian Government 2008a, p.6; Australian Government

2008b, p.xv).

Per Capita Emission LevelsGlobal warming is a world-wide phenomenon. Thus, these

impacts are largely the result of emissions from other parts of

the world including major emitters such as the USA, Japan,

Russia, the EU, and China. However, Australia is one of the

highest emitters on a per capita basis and also has signicant

total emissions, see Table 1. This indicates that, while Australi

cannot solve its global warming problem by itself, there are

many areas where we can improve our performance to world’s

