Under pressure, but caution best on visas
Sydney Morning Herald
September 5, 2006
THE magnitude of growth in demand for skilled workers has caught the Australian Government and employers short. Construction industry jobs surged by 31 per cent nationwide over the five years to 2005-06, compared with 11 per cent for all employment growth.
This escalation of demand, along with flat training levels, has generated serious shortages of civil engineers, construction tradespersons and bulldozer drivers, among other construction occupations. Specialist mining workers are scarce – not just here but elsewhere in the world – because training in these fields dropped off even more severely overseas than in Australia before the mineral boom.
What to do? The Government's priority has been to fill these skill gaps. Its fear is that if this is not done the resources boom could be punctured.
The Department of Immigration and Multicultural Affairs has been told to fill the breach. The permanent migration program has been doubled since the late 1990s but this has been of little value. Most permanent residents move to Sydney, Melbourne and, to a lesser extent, Perth, and few have entered the construction or mining industry.
The biggest increase in the program has been among former overseas students trained in Australia who are predominantly graduates in information technology and accounting. Fortunately, the Government appears to have recognised the situation and this year resisted pressure to increase the overall permanent resident program.
Instead, the focus has been on employer nomination, with the 457 visa the prime medium. The department has redoubled efforts to bring employers and prospective skilled workers together by organising recruitment fairs across the globe where employers can interview prospects first-hand.
The 457 visa is designed to make it easier for employers to sponsor workers on a temporary basis for specific jobs within their operations.
The procedures were deregulated in 1996, when employers were given the right to sponsor as many skilled workers as they pleased, without reference to whether there were local workers available, or whether the sponsored workers possessed the credentials required to meet Australian professional or trade standards, or whether they could speak English. Applicants for skilled permanent resident visas must meet these last two requirements.
Pressure on the Government to open the 457 visa to semi-skilled and agricultural labourers has been resisted on the proper grounds that employers should not be importing workers for tasks where locals could be trained.
However, employers operating in regional areas have, since November 2002, been permitted to sponsor semi-skilled workers. So far the numbers have been small, with only about 3 per cent of all of those nominated under the 457 program holding occupations below the trade level.
For the most part, the 457 visa seems to work as intended. The rules require that employers sponsor persons for particular jobs. They are unlikely to go to the expense of recruiting and bringing people to Australia if local workers are available.
Often the work involves intra-company transfers. A worrying proviso here is that just over half of those sponsored are already in Australia. We need to know more about their skills and origin, since sponsoring employers do not have to pay market rates.
The rise in the number of principal applicants sponsored under the 457 program to about 40,000 in 2005-06 has opened cracks in its administration. Since pay levels for occupations in shortage escalate, so too do the opportunities for recruiters with networks into low labour-cost areas.
There are plenty of skilled workers in the Philippines, China, India and elsewhere willing to work for wages and conditions well below the market rate in Australia. The first wave of such workers were IT specialists brought in from India by local recruiters and Indian service companies interested in moving work offshore.
In some instances, they have displaced local IT contractors and graduates. The Government has sought to diminish the problem by specifying relatively high minimum salaries and limiting warehousing – that is, where recruiting companies bring specialists here, and then hawk their CVs around to local recruiters or employers.
The Department of Immigration and Multicultural Affairs now has a difficult management problem. Its normal caution on visa matters has been compromised by the pressure it has been under to help solve the skill crisis. It is time for a return to its more normal conservative approach to issuing visas.
Bob Birrell is the director of the Centre for Population and Urban Research at Monash University.