Migration Programme 2015 16 Discussion Paper

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SETTING THE MIGRATIONPROGRAMME FOR 2015–16Discussion Paper

October 2014



2015–16 Migration Programme — Discussion Paper Page 2 of 21

Table of Contents

Context .................................................................................................................................................... 3

Consultation process ............................................................................................................................... 4

The Migration Programme ...................................................................................................................... 4

The size of the Migration Programme ................................................................................................. 5

The composition of the Migration Programme .................................................................................... 6

Planning the 2015–16 Migration Programme ...................................................................................... 7

Economic factors and labour market analysis ........................................................................................ 7

Labour market outcome of permanent migrants ................................................................................. 8

Temporary migrants in Australia ............................................................................................................. 8

Transition from temporary to permanent residence ............................................................................ 8

Net impacts of migration ......................................................................................................................... 9

Review of our programmes ................................................................................................................... 11

Skilled Migration Programme review ................................................................................................. 11

Alternative approaches to planning the Migration Programme ......................................................... 11

Conclusion............................................................................................................................................. 11

The Survey ............................................................................................................................................ 12

Attachment A – Detailed analysis ......................................................................................................... 13




Context

Australian immigration policy centres on managed migration, meaning that the government

determines the number and characteristics of people who may enter and stay in Australia.

Migration is managed through both temporary and permanent visa categories, whichtogether provide a comprehensive range of options for who may enter and stay, and on what

basis.

Skilled migration programmes target high quality migrants who use their skills and attributes

to contribute directly to Australia’s economic well-being. Family migration programme

addresses an important social objective in enabling Australian residents to reunite with close

family members from overseas. The wider global economic climate, as well as Australia’s

own economic and social climate, is a crucial consideration when setting the size and

composition of the permanent Migration Programme (the Migration Programme).

Planning the Migration Programme — both skilled and family migration — is a process that

remains focused on Australia’s national interest and the longer term benefits of migration.

Key questions include:

How can the department ensure the Migration Programme settings are responsive to

the changing economic environment in Australia and overseas and the future

demand for labour?

How can we ensure migrants make a strong contribution to Australia’s economic

prosperity?

What key social factors are important to consider when planning the size and

composition of the Migration Programme?

Does the current size and balance of the programme reflect the true economic and

family reunion needs of Australians?

How can the department help states and territories and regions in meeting their skill

needs and other considerations regarding migration?

What considerations are important in planning the Migration Programme with the

increasing number of temporary entrants in Australia?

Can the current approach to planning the Migration Programme be improved?

Temporary migrants are not included in the Migration Programme. Given the growing

number of temporary migrants who subsequently become permanent residents, and thepositive impact they have on Australia’s economy, temporary migrants are a factor for

consideration when planning the Migration Programme.

Note: Please keep in mind that the resettlement of refugee and humanitarian entrants

is not included in this discussion paper. The size and composition of the

Humanitarian Programme is decided through a separate process.




Consultation process

We seek your views on the size, balance and composition of the 2015-16 Migration

Programme and the factors taken into consideration in planning Australia’s future migration

intakes, including longer term indicators.

We hope to stimulate your thoughts around the planning for and management of the

programme to best meet Australia’s economic and social needs in view of the changing

nature of migration in Australia and overseas.

Your views will be considered in the department’s submission to government on the

2015-16 Migration Programme and will inform the size, balance and composition of

Australia’s future migration intakes.

This discussion paper also includes a link to a survey that seeks your views on the Migration

Programme. We encourage you to take the survey.

Closing date for taking the survey – Friday, 5 December 2014

State and territory consultations

As with previous years, the department will conduct a series of round table consultation

meetings with invited stakeholders in each Australian state and territory capital city

commencing in mid-October and concluding by end-November 2014. This year the

department is holding a regional consultation in Port Hedland in the Pilbara region.

Stakeholders will be provided with an opportunity to provide feedback on the Migration

Programme and associated policy settings.

The Migration Programme

The overall objective of the Migration Programme is to contribute to Australia’s economic,

demographic and social well-being. The Migration Programme is currently planned and

managed on an annual basis, and announced as part of the annual Budget process in May

each year. The size and composition of the programme is determined by a range of factors,

including:

feedback from the Australian community and from industry and business

bodies

short and long-term social, demographic and economic trends and

government policies

expected demand for skilled labour in key occupations and industries

(including in regional Australia) over the medium to long term as well as the

identified need to address critical labour force skill shortages that are unable

to be met by the domestic labour market or training schemes

estimated demand for family migration places

social, economic and labour market advice and analysis from other

government agencies including state and territory governments



http://www.immi.gov.au/media/statistics/pdf/report-on-migration-program-2013-14.pdf

http://www.immi.gov.au/media/fact-sheets/20planning.htm




This stream helps to address medium term labour market needs through employer

sponsored migration, where migrants come to specific jobs. The long term labour market

needs are addressed through points tested skilled migration that selects migrants based on

their highly skilled attributes to ensure labour market success on their arrival in Australia.

State/territory and regional nominated migration, which is also a points tested skilledmigration, helps the states and territories respond to varying regional and economic needs

through supplementing the labour force in key industries and regions.

Entrepreneurs, investors and innovators are attracted through the Business Innovation and

Investment Programme, and the Distinguished Talent category facilitates migration of

talented individuals to Australia.

More information on the Skill stream is available in Fact Sheet 24 and on SkillSelect at:

http://www.immi.gov.au/media/fact-sheets/24overview skilled.htm

http://www.immi.gov.au/skills/skillselect/

The Family stream

The Family stream of the Migration Programme facilitates the reunion of Australian citizens,

permanent residents or eligible New Zealand citizens with their immediate family members

overseas.

The Family stream has four main categories; partner, child, parent and other family. While

the primary focus of the Family stream is the social benefit of a united family, there is strong

evidence that there are wider benefits of family migration including contribution to the

Australian economy through employment and to the population through births. For example,

family migration further improves the age demographics of Australia, through younger

migrants entering the country.

The focus of recent changes to family migration has been on the closest family members —

partners and children.

Demand for places in the Family stream continues to be higher than the places available.

More information on the Family stream is available in Fact Sheet 29:

http://www.immi.gov.au/media/fact-sheets/29overview family.htm

The composition of the Migration Programme

The balance of the Migration Programme has shifted towards the Skill stream, and thebalance between the various elements of the Skill and Family streams has shifted towards

more targeted skilled migrants within the Skill stream in response to increasing labour

market demands over the past two decades.

http://www.immi.gov.au/media/fact-sheets/24overview_skilled.htm



http://www.immi.gov.au/media/fact-sheets/29overview_family.htm




http://www.immi.gov.au/media/fact-sheets/24overview_skilled.htm






offset somewhat by expansion of varying rates in other areas of private demand (RBA).

Overall, growth is expected to be slightly below trend for the next few quarters.

After a subdued labour market since 2011, some forward indicators of employment have

been firming this year. Employment growth has picked up somewhat, increasing by 1.5 per

cent over the year to August1. Workforce participation has improved marginally, after a

period of significant decline, to stand at 65 per cent in August. Nevertheless, there remains

a degree of spare capacity in the labour market and it will probably be some time before

unemployment declines consistently.

According to the Department of Employment, overall employment is projected to increase by

838,100 (7.2 per cent) reaching 12,442,700 by November 2018. Employment is projected to

increase in all industries except manufacturing, mining and agriculture forestry and fishing,

and health care and social assistance is projected to make the largest contribution to this

growth. This structural change may have implications for the department in planning future

skilled migration programmes.

Labour market outcome of permanent migrants

As migration is essential to the sustained growth of our workforce and a key ingredient in

meeting the challenges of an ageing population, it is important to know how well migrants,

particularly skilled migrants, are faring in the labour market.

The labour market outcome of migrants is one measure that can be used when assessing

the success of the Migration Programme settings. The department’s Continuous Survey of

Australia’s Migrants (CSAM) demonstrates the superior labour market outcome of skilled

migrants as well as the positive labour market outcomes of family migrants compared with

the Australian average. http://www.immi.gov.au/pub-res/Pages/research/continuous-survey.aspx

Detailed analysis of the economic and labour market indicators is provided at Attachment A.

Temporary migrants in Australia

In addition to permanent migrants, there are a significant and growing number of people in

Australia on temporary visas, including: international students, temporary skilled (457 visa)

workers, bridging visa holders and working holidaymakers. The number of temporary visa

holders in Australia at any point in time is around 1.1 million (around 5.1 per cent of

Australia’s population). Additionally, there are around 650,000 New Zealanders in Australiaon a special category visa which allows them to stay in Australia indefinitely.

Transition from temporary to permanent residence

Most temporary visa holders, including subclass 457 visa holders and students, are able to

apply for permanent residence while they are (legally) in Australia — meaning that

temporary residence can be a pathway to permanent residence. Analysis of these

1 Note that we have used trend estimates as at August 2014 rather than the more commonly cited seasonally adjusted data,

which have shown significant monthly volatility of late and may not therefore provide a reliable indication of recentdevelopments.

http://www.immi.gov.au/pub-res/Pages/research/continuous-survey.aspx








temporary entrants and their possible implications to future Migration Programmes is crucial

due to the increasing propensity in recent years of temporary entrants to transition to

permanent residence while in Australia.

Over the last decade, there has been considerable growth in the number of temporary

migrants in Australia. Many of these migrants hold work rights and contribute directly to the

Australian labour market, for example, through the temporary 457 programme. While

pathways to permanent residence are available to temporary migrants while in Australia, it is

not an automatic transition and in order to apply for a permanent visa, prospective migrants

are still required to meet prescribed criteria for qualification, skilled work experience and

English language skills.

The proportion of the Migration Programme places filled by people on a temporary visa in

Australia has increased from around 30 per cent in 2004–05 to 50 per cent in 2013–14. This

trend is particularly pronounced in the Skill stream where the proportion of onshore grants

has increased from 35 per cent in 2004–05 to 57 per cent in 2013–14. Onshore transition to

family visas has also increased during this time, albeit at a slower rate, from 23 per cent in2004–05 to 33 per cent in 2013–14.

The increasing proportion of the Migration Programme filled by people who previously held a

temporary visa in Australia is a positive trend. These people have been living, studying or

working in Australia prior to making an application for permanent residence, and implies that

they should have skills or qualities that make them valuable to us as well as having a

genuine commitment to and understanding of Australian values.

Net impacts of migration

The impact of migration on Australia’s population can be measured more accurately throughan aggregate measure — net overseas migration (NOM), than by just looking at Migration

Programme numbers. NOM measures the flow of people that remain in Australia for 12

months at a time (over a 16 month period) minus those who leave and tends to align closely

with the size of the Migration Programme.

NOM plays a key role in the overall rate of population growth, and we rely on NOM to ensure

Australia’s labour market does not shrink. A positive NOM also helps ameliorate the effects

of Australia’s ageing population.



http://www.immi.gov.au/media/publications/statistics/immigration-update/nom-june-2014.pdf

http://www.demographicinsight.com.au/other/McDonaldTemple%20-%20Web.pdf




Review of our programmes

Skilled Migration Programme review

In the current climate of globalisation, it is vital for Australia’s long term prosperity to maintain

a competitive advantage in identifying, attracting and retaining highly skilled overseas

workers. The Australian Government has therefore placed great importance on the need for

a clearer, deregulated skilled migration visa framework that will help shape and define

Australia’s economic future.

The department is undertaking a review of the current skilled migration and temporary

activity visa programmes.

The review is in its early stage, and the department is currently seeking input from

stakeholders through a discussion paper on its website: Reviewing the Skilled Migration and400 Series Visa Programmes. Most visa subclasses across the skilled migration and

temporary activity visa programmes are currently within the scope of the review and are

listed within the discussion paper.

More information can be found on: http://www.immi.gov.au/pub-res/Pages/discussion-

papers/overview.aspx

The department is holding a separate series of consultative forums and meetings to

elaborate on the scope of this review.

Alternative approaches to planning the Migration Programme

The Migration Programme is planned annually. Alternative approaches to planning, with a

longer term planning horizon and an increased flexibility within the programme to respond to

the ongoing and emerging economic needs and family reunion challenges of Australians,

could offer a better way to look at the size and composition of Australia’s future migration

intakes.

As part of this process, the department may be exploring alternative planning options

including a range-based planning approach and a multi-year planning cycle for future

consideration.

Conclusion Australia has a dynamic and growing economy where skills are still needed, where

employment is forecast to grow in most industries, and where unemployment is predicted to

remain fairly static. Australia has a social framework that is global and inclusive, and

increasing numbers of temporary migrants are making informed decisions that Australia is

where they would like to live.

The department is aware of the increasing global competitiveness in attracting and retaining

highly skilled migrants from overseas and the need for a clearer, deregulated skilled

migration visa framework that will help shape and define Australia’s economic future.

http://www.immi.gov.au/pub-res/Pages/discussion-papers/overview.aspx









In planning the size, balance and composition of the 2015–16 Migration Programme, the

department will need to be informed by careful consideration of these factors and trends as

well as the views of the Australian public to ensure the programme delivers on what it is

intended to—responding to Australia’s longer-term economic and social needs.

The Survey

The Department invites you to take the MigrationProgramme 2015 –16 Survey before

Friday 5 December 2014

Click below to continue to the survey

https://www.surveymonkey.com/s/RYWVBKG

Note that all survey responses will be confidential.

Or read on to learn more about the details behind thepaper








http://www.rba.gov.au/publications/smp/2014/aug/pdf/0814.pdf




Australia-wide labour market conditions3

Unemployment has edged higher and in trend terms stood at 6.2 per cent in August, its

highest level in more than a decade. Despite the recent improvement in the participation

rate, participation is still around its lowest level in nearly a decade and while forward-looking

indicators of labour demand have recently improved they nonetheless remain at low levels.With economic growth forecast to be below trend in 2014–15, it is likely that Australia’s

unemployment rate will remain elevated for some time, the RBA and Treasury are expecting

that it will not decline in a sustained way until 2016.

Figure 2: Key indicators of recent labour market conditions

Source: ABS Cat No 6202.0

Recent employment growth across industries

Recent employment growth by industry (Figure 3) reflect the changing composition of

economic activity. Employment in the household services sector has continued to exhibit a

strong upward trend with the health and education industries accounting for the bulk of

employment growth in this sector. Business services employment surged ahead for the first

part of this year, the strength in the housing market driving demand for labour in the

professional and real estate industries. It appears, however, that this surge has run its

course, with employment growth in the sector dropping off slightly in recent months. This is

a trend reflected in the other main industries, particularly mining, providing further evidence

of the spare capacity in the labour market.

3 Note that unless otherwise stated, we have used trend estimates as at August 2014 in this section rather than the more

commonly cited seasonally adjusted data, which have shown significant monthly volatility of late and may not therefore providea reliable indication of recent developments.




Figure 3: Employment growth by industry, cumulative over five years to August 2014

Source: ABS Cat No 6291.0.55.003, E06, original data. *Household services include accommodation and food services,education and training, health care and social assistance, arts and recreation services and other services. #Business servicesincludes information media and telecommunications, financial and insurance services, rental hiring and real estate services, professional, scientific and technical services, and administrative and support services.

Labour market growth across states and territories

The changing composition of economic activity can also be seen in the recent employment

growth across states and territories (Figure 4). While growth has generally picked up across

most states and territories, consistent with the broader trend for Australia as a whole, it has

been particularly strong in the big three eastern states of New South Wales, Victoria and

Queensland. However, in percentage terms, Northern Territory and Western Australia’saverage growth is above the average growth for the eastern states.




Figure 4: Employment growth by state, cumulative over five years to August 2014

Source: ABS Cat No 6202.0, tables 4-9, trend data.

Skill Shortages

The Department of Employment has an ongoing skill shortage research programme

involving consultation with employers and recruitment agents on the labour market for more

than 100 occupations. Results from this research programme are regularly published in the

six monthly report Skill Shortages Australia. The latest report, for 2013-14, was recently

published on the department’s website. The main findings are noted as follows:4

Skill shortages are currently not a feature of the Australian labour market. Employers

are generally recruiting skilled workers without marked difficulty and the number of

occupations in shortage is at an historical low.

In 2013-14, there were generally large fields of applicants vying for skilled jobs andemployers filled a high proportion of their vacancies.

There is now little disparity between employers’ recruitment experiences across the

states and territories due, in part, to the slowing activity in the resources states.

Employers in regional locations still have more difficulty recruiting skilled workers

than those in metropolitan areas, but most fill their vacancies readily, and the gap

has narrowed.

4 Department of Employment, Skill Shortages Australia 2013-14,http://docs.employment.gov.au/node/31449 .

http://docs.employment.gov.au/node/31449






Shortages are more evident for trades (with 18 in shortage) than professions (5).

University graduate employment outcomes have weakened in recent years and

labour markets for professionals are generally more than adequately supplied.

While shortages of trades workers have abated in the past few years, this easing hasnot been to the same extent as that for professionals.

Vacancy levels have increased more strongly over the past year for technicians and

trades workers than they have for professionals. Vacancies increased by

9.5 per cent for professionals but increased by 17.1 per cent for technicians and

trades workers over the year to June 2014. Nonetheless, employment growth for

professionals continues to outstrip that for technicians and trades workers, rising by

1.1 per cent (or 27,100) over the year to May 2014 compared with an increase of 0.7

per cent (or 12,200) for technicians and trades workers.

A significant proportion of surveyed vacancies remained unfilled and the reasons were

varied.

Many of these vacancies attracted multiple qualified applicants but they did not meet

employers’ precise requirements.

A number of vacancies attracted applicants who were suitably skilled but employers

opted to defer recruitment until they attracted their ‘ideal’ candidate.

Some employers and preferred applicants were unable to agree on the terms and

conditions of employment.

Around 4 per cent of employers did not attract any applicants.

Longer Term Outlook

Each year, the Department of Employment prepares five year indicative projections of

employment growth by industry, occupation, skill level and region. The latest projections are

for the five years to November 2018 with key results summarised as follows : 5

Australia-wide: Total employment is projected to increase by 838,100 (7.2 per cent)

reaching 12,442,700 by November 2018.

Industry: Employment is projected to increase in all industries except manufacturing,

mining and agriculture forestry and fishing. Health care and social assistance is

projected to make the largest contribution (up by 229,400) followed by education and

training (118,800), retail trade (98,200), professional, scientific and technical services

(88,700) and construction (83,500). Together, these five industries are projected to

provide more than two thirds of the employment growth over the next five years.

Skill Level: While the evolution of the labour market towards higher skilled occupations

looks set to continue, with Skill Level 1 projected to make the largest contribution to

growth (356,900), there is also strong growth in employment projected for Skill Level 4

(225,300) providing lower skilled opportunities for job seekers.

5 Department of Employment, Employment Outlook to November 2018 ,http://lmip.gov.au/default.aspx?LMIP/EmploymentProjections.

http://lmip.gov.au/default.aspx?LMIP/EmploymentProjections






Occupation: Employment is projected to increase in all of the main occupational groups

with the strongest gains for professionals (270,800) and community and personal service

workers (166,200). Specific occupations with the largest projected gains are aged and

disabled carers (40,900), followed by sales assistants (39,400) and registered nurses

(36,900).

States and Territories: Employment is projected to increase in all the states and

territories with the largest gains in New South Wales (241,600), Queensland (215,100),

and Victoria (196,300). While employment growth is expected to remain relatively strong

in Western Australia (119,400), it is projected to slow from the rates of the past five

years, given the predicted falls in mining investment.

Regions: Employment growth is projected to be stronger in metropolitan areas (7.6 per

cent) than in regional Australia (6.7 per cent). The largest projected increases are for the

west, south-east and inner parts of Melbourne (110,200) followed by the north west and

south east of Perth (65,500) and the Gold Coast (32,900).

Labour market outcome of recently arrived migrants

Migrants contribute to the three factors of economic growth – population, participation and

productivity. They lower the population age profile, add to the size of the labour force, have

high labour force participation rates and bring innovation and entrepreneurship to Australia

and, through their contacts, help make business and trade connections overseas. They are

selected based on attributes to ensure labour market success on arrival.

The labour market outcomes of migrants are one measure that is used when assessing the

success of the Migration Programme and policy settings. Results from the department’s

Continuous Survey of Australia’s Migrants, run between 2009 and 2011, have provedinstructive in this regard. With the resumption of the survey in 2013, we now have a new,

updated set of results, recently published in a report on the department’s website.6 Key

findings include:

Skill stream primary applicants achieved good employment outcomes at the six-month

stage of settlement. This included a moderate unemployment rate of 5.7 per cent, a very

high participation rate of 95.6 per cent, high income levels and high rates of employment

in highly-skilled and full-time work. Skill stream primary applicants outperformed the

general population on most of these measures.

Employment outcomes (particularly the unemployment rate) of partner migrants were

generally not as good. This is not unexpected, given that these migrants were not

selected for migration on the basis of their employment prospects. However, what is

encouraging is a participation rate for these groups that is substantially higher than the

general Australian population, and indicative of an interest in finding work.

6 Department of Immigration and Border Protection Continuous Survey of Australia’s Migrants: Cohort 1 Report–August 2014,http://www.immi.gov.au/pub-res/Documents/research/csam-2014-cohort-1.pdf .

http://www.immi.gov.au/pub-res/Documents/research/csam-2014-cohort-1.pdf





http://www.immi.gov.au/media/publications/statistics/immigration-update/nom-june-2014.pdf

http://www.abs.gov.au/ausstats/[email protected]/mf/3417.0




http://www.immi.gov.au/media/publications/research/_pdf/migration-population-futures.pdf

http://www.demographicinsight.com.au/other/McDonaldTemple%20-%20Web.pdf