Opinion article

Temporary skilled migration not just good for business

Following the release of Effects of temporary migration, CEDA CEO, Melinda Cilento examines how building an efficient and transparent temporary skilled migration scheme is in everyone’s interests. 

Temporary skilled migration is good for business, our economy and the existing workforce and we need to be more vocal about its importance.

The latest economic modelling by CEDA shows that migration broadly has not had a detrimental effect on the wages or jobs of Australian workers.

In fact, our analysis points to immigration having a positive impact on the wages and participation of local workers. This should not really be surprising.  On average, recent waves of migrants have been younger and with higher qualifications than the average Australian.  This is particularly the case for temporary skilled migrants. 

Temporary skilled migrants are generally on higher annual incomes, the average base salary for a skilled temporary visa holder is $95,000, meaning these workers are unlikely to undercut local employment terms and conditions.  Temporary skilled migrants also bring skills and know-how to Australian workplaces and they spend in their local communities, pay taxes and do not access government provided services.  Which is to say they deliver positive impacts to budgets and the economy more broadly. 

Globalisation has been and is unashamedly in our interests, it has delivered higher living standards and incomes for Australians. Having a well functioning skills gateway for global talent is an important part of this.
As a mid-sized economy far away from global markets, the importance to our economic success of free movement of goods, services, investment and skills, can’t be understated.

And as a result, we should be making it easier for business to import the best global talent and expertise.
Australia’s training and education system will not always be fast enough to respond to emerging skill needs, such as highly skilled engineers for construction projects, or to significant and rapidly emerging structural shifts – think cyber security. Temporary skilled migration assists the market to respond effectively to these skills shortages. 

In addition, senior international executives provide an opportunity for local workers to soak up their experience – they bring the experience of the rest of the world to us.

Despite the strong and clear benefits associated with temporary skilled migration, this visa category has been subject to a revolving door of reviews and changes in recent decades.  This includes the 2017 abolition of the 457 visa, which surprised many in business.

The Prime Minister has recently called on business to highlight ways in which red-tape can be cut and business investment and productivity supported.  CEDA’s research outlines a number of ways in which the efficiency and effectiveness of the temporary skilled visa system could be improved. These measures would assist business to undertake workforce planning with greater certainty, while seeking to improve community confidence that the scheme is working in the interests of all Australians. 

CEDA is well aware of recent cases highlighting the exploitation of temporary migrant workers, including those on training or student visas. This is unacceptable and not in the interests of business. 

The Migrant Workers' Taskforce, headed by Professor Allen Fels, earlier this year outlined a suite of recommendations to stamp out migrant worker exploitation including much tougher penalties such as prison sentences. Money was subsequently provided in the 2019-20 Federal Budget to respond to those recommendations. This is a strong and appropriate response and hopefully will ensure the integrity of the system which is fundamental to maintaining community support for migration. 

In addition to these measures, the Federal Government should aim to improve the transparency and predictability of the temporary skilled migration scheme.

Increasing transparency of data and methods used in determining professions for the skilled occupation list and introducing a dedicated path for intra-company transfer of employees to Australia are steps that CEDA recommends.

Establishing an independent committee to undertake analysis and consultation on the formulation of skilled occupation lists, mirroring the model used in the UK, and regular Productivity Commission reviews of the program would also help.

The myths around temporary skilled migration have been busted. It’s time to focus on building community confidence in the scheme and efficiency that allows business to access the talent, skills and experience they need. That’s in everyone’s interests.

Effects of temporary migration

In CEDA's latest report, read more about the effects of temporary migration on Australia's economy and society, explore the recommendations CEDA has suggested to improve the system and learn how temporary skilled migration can positively build our workforce and businesses. 
About the authors

Melinda Cilento

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Melinda Cilento is Chief Executive of CEDA, a company director, economist and experienced senior executive. She is a non-executive director of Australian Unity and Co-Chair of Reconciliation Australia. Melinda is also a member of the Parliamentary Budget Office panel of expert advisors.

Melinda was previously a Non-Executive Director with Woodside Petroleum, Commissioner with the Productivity Commission and Deputy CEO and Chief Economist with the Business Council of Australia. Melinda has also previously held senior roles with the Federal Department of Treasury, Invesco and the International Monetary Fund.

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