“State Nomination, 189, Employer Sponsorship and Other Skilled Migration Should Be the Priority — the Real Contribution Is Greater!” Latest Government Think Tank Report!
Yesterday we learned from documents related to the federal Senate: in the new financial year — that is, FY21-22 — the PR quota adjustments are employer sponsorship will increase to 23,500, skilled independent migration (189) will increase to 7,500, regional state nomination (491) will increase to 13,150, and other state nomination (190) will increase to 13,150.Investor migration will decrease to 11,000, the Global Talent Independent programme (GTI) will decrease to 11,000, and Distinguished Talent will increase to 350.
Of course, there’s a known premise here: the overall quotas for the skilled migration and family migration streams haven’t changed — this was already confirmed when the budget was officially announced — and the adjustments to the sub-categories come from reducing the GTI and investor migration quotas to top up the other categories,
with the specific breakdown compared to last financial year as follows:
While the numerical adjustments aren’t huge, they do show the federal government prioritising state nomination streams 190 and 491, along with employer sponsorship, which can directly address employers’ skills shortages.
The 189 stream, which was cut significantly over the past two years, has also gained 1,000 extra places — but given the base was only 6,500, and considering the 189 quota is shared with the New Zealand stream under the points-based system, and that Australia effectively lowered the income requirement for New Zealand stream applicants because of the pandemic, this increase of 1,000 places is unlikely to bring any real change to the 189 stream.
State nomination and employer sponsorship are where the real trend and opportunity lie! Of course, even after the cuts, GTI and investor migration each still have more than 10,000 places.
In fact, the number of places set for each migration category comes down to a supply-and-demand relationship, based on Australia’s economic conditions, based on labour market vacancies, based on the demands of relevant groups, and based on other factors.
In FY18-19 and FY19-20, the government’s focus was on regional needs; in FY20-21, affected by the pandemic, the focus shifted mainly to investment and high-skilled/specific-skill talent; and FY21-22 marks the start of the recovery phase from the pandemic.
The Australian government think tank Grattan Institute pointed out in a recent report that Australia’s migration direction has drifted off course in recent years…
Skilled migration should return to being the priority
The constant changes to migration programmes in recent years have shifted Australia away from selecting young skilled talent who can earn high incomes in the labour market, towards older people with weaker English ability, whose skills ultimately have less impact on Australian society.
Although Australia has, in a sense, “given up” tax revenue in recent years, skilled migration can bring the budget long-term contributions.
Skilled migration mainly delivers a fiscal dividend to Australian society, because they pay more in tax than they draw in public services and benefits over their lifetime, and that is the core finding of this Grattan Institute report. There’s also a view that has already been verified many times before — migration has minimal impact on the wages of existing Australian workers.
The report recommends restructuring how migrants are admitted, noting that permanent skilled migrants can generate an additional AUD 9 billion in personal income tax each year while onshore.
As for the various skilled migration categories today, they believe…
Grattan Institute also analysed the main pathways into skilled migration today: currently, more than half of migrants who obtain permanent residency already hold a temporary visa in Australia — and for the skilled migration category, that figure rises to over 70%.
These are the points-based system (189/190/491, all of which require points) and the employer-sponsored system (mainly categories 482/186/494).
They believe that, within the points-based system, some of the points criteria are too strict — for example, the points awarded for work experience — should be independently reviewed, with the focus on how to better select young skilled talent.
As for investor migration, Grattan Institute has stronger reservations, believing that it doesn’t actually achieve the investment-plus-innovation outcomes the government wants, and that the larger the business investment amount, the older the applicant tends to be and the weaker their English ability tends to be — so they’re not seen as bringing much to Australian society.
As for GTI, the intent is good, but its value has yet to be proven.“Before making any decision to expand visa numbers, the programme should be scaled back and evaluated.
In addition, they believe temporary migrants can be selected based on short-term skills shortages, but permanent migrants should not be considered on skills shortages alone, implying that permanent migrants contribute more in other respects.
Permanent residency should first be drawn from onshore temporary residents
Migration Council Carla Wilshire believes temporary residents should be seen as candidates for permanent residency, “We need to make sure temporary migrants have a pathway to permanent migration,” she said. “I think one thing the pandemic has exposed is the issue of unequal treatment between temporary and permanent migrants.”
Now is the time to start considering whether we can expand our permanent migration programme, genuinely build the link between temporary and permanent migration, and give people the opportunity to make a lifelong contribution.
The government should first focus on those who are already here and grant them permanent residency, and then gradually, gradually, bring in more people from overseas.
Going back to basics may well be the most suitable approach
Most experts agree that the post-pandemic period is an opportunity to reposition our future workforce, at a time when Australia is seen as an attractive place to work and live. In recent years, Australia’s migration programmes have been “colourful and varied” and “changed on a whim,” but after researching this, Grattan Institute found that from the perspective of the demographic dividend migrants bring to Australia and their long-term lifelong contribution, going back to basics may be the most suitable approach, with skilled migration being fundamental to increasing employment numbers in Australia.
“As we gradually emerge from the pandemic, this will be one of the issues we must look into — we’ll need to work out how to revise the migration programme so as to maximise the number of jobs it provided for the Australian economy at the time.”
A Department of Home Affairs spokesperson said the Minister for Immigration has asked Parliament to conduct an inquiry to consider long-term issues relating to the skilled migration programme, and will consider its recommendations when announcements are made in July.
In the future — the foreseeable future — there should be changes big and small.
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