POST 12: IS THE McGOWAN LABOR GOVERNMENT STOCKPILING OVERSEAS WORKERS?

The McGowan government’s flawed state migration agenda continues.

Why does the McGowan government migration list contain occupations on the Medium to Long-Term Strategic Skills List (MLTSSL)? Will this result in a stockpile of overseas workers in Western Australia?

Overview.

After winning the 2017 State election the McGowan government implemented a much reduced migration occupation list and terminated the Regional Sponsored Migration Scheme in Metropolitan Perth. This was a more responsible approach to State migration compared to the previous Liberal Coalition government, which oversaw record-breaking immigration arrivals and massive population growth. But recently the Labor government has changed direction and embarked on a migration growth strategy.

Stockpiling overseas workers for the long term?

Take for example the Graduate Migration Occupation List (GMOL), which has over 200 occupations for overseas students to apply for State nominated visas. The release of the GMOL could not have come at a worse time, coinciding with West Australia’s high unemployment levels. But this is not all. A meagre 24 out of the 209 GMOL positions fall into Australia’s immediate short-term skills shortage list.[1] In other words the majority (185 occupations) are listed in the MLTSSL – meaning these occupations may only be required in two to ten years’ time. One way to view the Australian governments MLTSSL is that it could lead to an oversupply of overseas labour into West Australia. The MLTSSL functions to keep the visa numbers up and removes the threat that overseas student enrolments might decline.[2] In 2018 Western Australia had nearly 52,000 foreign student enrolments (see Table 1 below). Chinese and Indian students made up 42% of total enrolments in West Australia’s higher education sector for 2018.[3]

Table 1: Western Australia overseas student enrolments, calendar years 2008 to 2018.
[visualizer id=”4340″]
Notes: VET is short for Vocational Education Training. ELICOS is short for English Language Intensive Course for Overseas Students.

Table 1 above indicates there is a large pool of overseas student enrolments from which West Australian employers can choose as soon as the student commences study at a West Australian Institution. Since 2008 the  Australian government implemented  extremely liberal working rights for  foreign students to take advantage off. Making it that much easier for Australian employers to substitute local workers with overseas students. Overseas students may be willing to accept any offers that come there way given the much higher earning and conditions available in Western Australia compared to there countries of origin.

Are overseas students substituting local West Australian’s out of a job?

This should not be washed over at a time when West Australian youth are struggling to find work; the competition for local jobs is getting more acute. Looking at Table 1 it is clear that an attractive pull for overseas students is the VET sector increasing from 21.3% in 2008 as a portion of all student visas to nearly a third of all visas (32.9%) in 2018. This rising trend of foreign students taking VET courses seems an unnecessary level of competition brought on by overseas student arrivals. Competing for the types of employment which would be better suited to local West Australian school leavers that are already attending or completing there certificates at West Australian TAFE courses.

But it is not only the rise in overseas enrolments at VET, which local workers may come up against. There is also the additional competition for local jobs brought on by the rise of foreign students arriving in Western Australian with low Standard English language skills. Quite concerning that overseas students with below standard English are able to take on local employment as soon as they arrive in Western Australia. Table 1 reveals that 18 % of the students visas are made up of students requiring the intensive English language course (ELICOS). The percentage of overseas students/workers visas that have attended ELICOS training in WA has fluctuated between 26% and 18% from 2008 to 2018.

It is worth bearing in mind that most economists accept there is major problem when large numbers of  low skilled Labour from overseas are able to access jobs in advanced economies. The immediate short-term effects of immigration on the wages or employment of existing workers depends on the extent to which migrants have skills that substitute or complement those of existing workers. When migrant workers are substitutes for existing workers, immigration is expected to increase competition for jobs and reduce wages.[4]

References.

[1] Australian Government, ‘Migration (LIN 19/051: Specification of Occupations and Assessing Authorities) Instrument 2019’, 2019, p. 19 <https://www.legislation.gov.au/Details/F2019L00278> [accessed 11 June 2019].

[2] Bob Birrell, Australia’s Skilled Migration Program: Scarce Skills Not Required (The Australian Population Research Institute) <http://tapri.org.au/wp-content/uploads/2016/04/Final-March-8-Australias-skilled-migration-program.pdf>.

[3] Australian Government Department of Education and Training, ‘International Student Data’, 2019 <https://internationaleducation.gov.au/research/international-student-data/pages/default.aspx> [accessed 16 July 2019].

[4] The Migration Observatory at the University of Oxford, ‘The Labour Market Effects of Immigration’, Migration Observatory, 2018 <https://migrationobservatory.ox.ac.uk/resources/briefings/the-labour-market-effects-of-immigration/> [accessed 24 August 2019].

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