Shadow Immigration Minister and Labor Senator, Kristina Keneally's opinion piece, set out her desire to review the migration program after the COVID-19 pandemic. Senator Keneally asked 'do we want migrants to return to Australia in the same numbers and in the same composition as before the crisis?' Her answer was no, and she highlighted concerns about temporary visa holders taking jobs from young Australians, use of temporary migrant visa holders as cheap labour, and the 'lazy approach' to economic growth of using migration to increase economic demand.
I agree that Australia would be foolish to return to the same policy settings. However, I disagree with many of the Senator's propositions. The claims that Australia relies upon cheap overseas temporary labour which undercuts Australian wages and that temporary migrants 'take' Australian jobs are based on misconceptions of the labour market and operation of the migration system. They do however identify a key problem in the migration system – the lack of enforcement of immigration and workplace laws.
Using migration to return the economy to a semblance of normalcy is highly sensible – not lazy. The Australian migration program is composed of many elements and achieves many purposes, among them family reunion, providing protection to refugees, facilitating trade and investment, sourcing skills through employer sponsorship or directly, and providing training and education. It is in Australia's interests to encourage these temporary and permanent migration programs to continue, in appropriate numbers, to benefit the economy and society.
But the real opportunity here is to create a fairer migration system. One which offers temporary residents a more reliable pathway to permanent residency and which recognises that the elimination of wage theft and illegal workplace conditions among temporary migrants will benefit all Australian workers
Current conditions creating precariousness
A number of the issues highlighted by Senator Keneally arise from the structure and operation of the migration system itself, not from the number of temporary migrants. For example, the shift to a 'multi-step' migration system in past decades, characterised by multiple temporary visas followed by permanent visas, has resulted in large numbers of temporary visa holders remaining in Australia for many years. While most of these individuals wish to become permanent residents, policy changes have often removed any once viable pathway.
The 2015 Productivity Commission report, 'Migrant Intake into Australia' informed the creation of the 482 Temporary Skill Shortage visa. The 482 visa replaced the longstanding 457 Long Stay Work visa. But the 482 visa deliberately removed the pathway to permanent residency for approximately 50% of this temporary visa holder cohort.
Further, by limiting this cohort of 482 visa holders to a maximum of 2 onshore visas, the system discourages reporting workplace exploitation. This is because temporary migrants are unlikely to risk losing their job by registering a workplace complaint or taking matters to the Fair Work Commission. To do so risks losing your job and thereby being forced to return home.
In this way, the 482 visa has created the first Australian guestworker program. This and other changes introduced greater precariousness into the temporary employer sponsored work system. Precariousness here refers to the uncertainty arising from being a temporary migrant without a pathway to permanent residency and reliance on employment and the goodwill of the employer to remain in Australia. This reliance means many precarious migrants take risks to remain in Australia, which can include accepting underpayments, illegal working conditions, and in some cases abuse, rather than risk informing the authorities. While these may not appear rational choices, people with limited options sometimes make irrational decisions to prevent what they perceive a greater harm.
As we saw with the 7-Eleven scandal, many migrants are scared to report workplace exploitation because the laws penalise any involvement in wrongdoing by migrants, knowing or unknowing. A finding of wrongdoing, even under instruction from an employer, may result in the Department cancelling their visa. Anecdotally, we also find that authorities prefer to cancel temporary migrants' visas rather than deal with the cost and complexity of prosecuting the employer. This drives exploited workers to hide their exploitation – a clear failure of laws intended to protect migrants.
Past scandals have shown that bad actors deliberately use legal loopholes to manipulate visa holders into breaching their visa conditions and then exploit their labour through threats of visa cancellation. Bizarrely, while this type of exploitation is only possible because of poorly structured laws and enforced laws, temporary migrants are often blamed for driving down wages across the system, despite being the primary victims.
Senator Keneally is correct that the vast majority of temporary migrants must be paid the same as an Australian in the same role by law, whether based on industrial awards or what an equivalent Australian in the same role would receive. As such, there is no legal reason their circumstances should lower Australian market conditions. However, as discussed above, it is the lack of enforcement that means this does not always occur in practice.
These issues could be addressed by reforming laws to enable victims to come forward, guaranteeing exploited workers protections and existing laws are enforced. Eliminating the exploitation of temporary migrants would improve broader labour market conditions by ensuring there is no longer a marketplace for exploited labour.
It is worth noting that the apparent increase in wage theft over the last decade affects both Australians as well as temporary migrants. Evidence suggests tens of thousands of Australian citizens and permanent residents are also victims. The fact this occurs to both Australian citizen and non-citizen labour suggests that it is our institutions lack the capacity to resolve these problems. Temporary migrants experience this phenomenon disproportionately because they are more vulnerable due to the precarious nature of their right to remain in Australia.
Temporary Migrants – the current state of play
While Senator Keneally points out there were 2.1 million temporary visa holders in Australia mid-year 2019, she did not point out that many of these visa holders do not have work rights. Of those who do, the largest cohorts are New Zealand citizens (680,000) and Student visa holders (550,000), followed by employers sponsored workers (180,000) and Working Holiday Makers (135,000). While the numbers are significant, it is only a 20% increase from when Labor was in power at the end of 2012.
Many temporary migrants who are leaving now have lost their jobs due to the Coronavirus pandemic. This is despite being lawfully resident and contributing to Australian society and economy for many years. While they hold temporary visas, many have lived in Australia for years, some for 10 years or more, as they seek a pathway to permanent residency. While referring to them as 'temporary migrants' is technically correct, it denies their lived reality. Many have families, homes, and friends in Australia, and some have children that do not speak any language but English.
Many of these temporary visa holders entered Australia at a time where they were explicitly or implicitly encouraged by government policy to do so on the basis of a pathway to permanent residency. Until the abolition of the 457 visa in 2017, this was the government's preferred pathway to permanent residency, despite claims to the contrary from Secretary of Home Affairs, Mike Pezzullo. In many cases, temporary residents have spent thousands of dollars studying in Australia, paid tax for many years with little or no access to benefits, while seeking an increasingly elusive pathway to permanency. These pathways have been altered or removed, leaving them in limbo despite years of contribution.
We should be encouraging these individuals to stay to continue to play a role in our community and support the economy after the pandemic. The real solution to these issues is to ensure that they, as well as future temporary visa holders, have a pathway to permanent residency. A clear and reliable pathway to permanency will reduce the likelihood they can be exploited and that they can enforce their right to fair workplace conditions.
Labour Market challenges
Senator Keneally states that there are Australians who would love to fill the jobs taken by these temporary migrants. However, from a practical perspective, while many Australians are seeking employment, the nature of the labour market shows that it is not at all clear unemployed Australians can fill these roles. A job opening as an intensive care nurse in Perth cannot necessarily be filled by an unemployed hospitality worker in Newcastle.
Firstly, we must be wary of the notion it is possible to 'substitute' one worker for another. At lower skill levels, Australians may prefer to stay unemployed rather than take certain positions. Horticulture, including fruit picking, is a prime example. At higher skill levels, there may not be suitable Australians available or who want the jobs. While a larger pool of unemployed Australians will mean a greater chance that we can substitute workers, the nature of the pandemic means that the skills of those unemployed and the demand for labour will not always match.
Secondly, training and skills development requires a substantial period of time. One problem in labour markets is that employers require the skills immediately and retraining may be lengthy. Governments should be investing in education however this does not resolve problems occurring now. Employers should also be encouraged to utilise local skills where possible however this is not always practical or possible. In the meantime, Australian businesses would suffer where they are not able to recruit suitably-skilled overseas workers. Very few employers would put themselves through the time, substantial expense and effort of sponsoring an overseas worker where a suitable local is available for the role.
Thirdly, while migrants may displace local workers, this is not the same as 'taking their jobs'. Research shows that migrants add to the economy by creating additional demand, indeed, that is the basis on which Treasury uses migration to boost the economy during a slowdown. By doing work that Australians are either unable or unwilling to do, migrants create demand for other goods and services. This increase to local demand and creation of additional jobs and has the potential to support a larger number of local jobs.
From a geographic perspective, demographic trends show most Australians are unwilling to relocate to regional or rural areas to fill needed positions. Temporary migrants are far more willing to relocate. This has the potential to support growth in regional areas where Australians are often unwilling to move.
Lastly, from a status perspective, migrants are much more likely to take work considered 'dirty, dangerous or demeaning', so-called '3D work', whether in an abattoir, picking fruit, or as a cleaner. The reality is, there are jobs Australians do not wish to do and, in these cases, temporary migrants fill a vital role that Australians are unwilling to perform. Once again, the fruit picking example is instructive – without backpacker or Seasonal Workers in regional Australia, Australian fruit would not get picked, and this program has been heavily incentivized to encourage and perpetuate this labour source because (simply put) Australians are not interested in doing the work.
Improving the current system is key
Post-pandemic Australia will benefit from continuing with temporary and permanent migration. However, current program settings have made temporary visa holders' situations precarious, by restricting access to permanent residency and effectively limiting their ability to enforce their workplace rights. There are ways to reduce temporary migrants' precariousness – these include providing pathways to permanent residency and encouraging them to report exploitation. New Zealand citizens are a prime example – the lack of pathways to residency has meant that many families and individuals remain in precarious positions.
Rather than blaming temporary migrants for underpayments, poor workplace conditions, and low wage growth, authorities need to reinvigorate the industrial relations system and enforce existing laws by properly resourcing enforcement. Appropriately recognising and penalising exploitative employers is the essential puzzle piece for authorities to pursue here. The best interests of temporary migrants and Australian workers are aligned – not in conflict.
Retraining Australians will be critical as we emerge from the pandemic. However, there are many barriers to filling skill gaps in the local labour market. Some can be addressed through better training and localised investment. But there is still a clear role for immigration to source the skills needed to meet immediate economic needs. Ultimately, it is Australian businesses who will suffer if this essential tool is substantially reduced. If the ability to recruit one highly-skilled overseas worker facilitates the employment of multiple local jobs, this is clearly a positive outcome for Australia.
Ultimately, the policy imperatives of a fairer migration system and better workplace protections are complementary, not contradictory, and will benefit businesses and workers both temporary and local. Encouraging migrants to stay during the pandemic, and to continue to come to Australia afterwards, will enable Australians and temporary visa holders, to return to normal sooner rather than later.
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