Experts are divided on whether boosting migration helps or hinders the economy


She said that immigration and economic growth are intrinsically linked and research has shown that migrants add to the labor supply but also use more goods and services and therefore have minimal effect on labor. wages and job availability.

Corinna Economic Advisory founder Saul Eslake said the border closures reduced the growth of working-age people, which in turn reduced the job creation needed to bring down the unemployment rate.

“Of course, we don’t get the demand from migrants that we would have otherwise, but this is at least offset … by the greater number of Australian expats who have returned and by the embezzlement of over $ 50 million a year that Australians would have gone overseas, ”he said.

He was not in favor of reducing permanent migration when borders reopen, saying they make a positive, albeit small, contribution to per capita economic growth and enrich society in many ways, but said that ‘it was justified to reduce temporary visas.

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Keeping immigration low is supported by Market Economics Managing Director Stephen Koukoulas, who instead wants the current pool of 1.75 million unemployed or underemployed Australians trained to deal with skills shortages. skills.

“The importation of low-wage labor obviously depresses local wage growth and the current border closure shows this perfectly,” he said.

But RBC Capital Markets chief executive Su-Lin Ong said migration has supported the country’s strong population growth and helped strengthen the skilled workforce and mitigate the effects of an aging population.

“We think it’s important to start safely bringing back some key offshore cohorts as soon as possible before the borders fully open and before reverting to something like pre-pandemic standards,” Ms. Ong said. In particular, this would include international students who are essential for working in the hospitality, leisure and tourism sectors and skilled professional migrants in areas of shortage.

“Labor constraints will, at some point, if they persist, start to restrict production and growth,” she said.

Another expert who raised the issue of temporary visas keeping the wages of local low-skilled workers cut was Jakob Madsen of the University of Western Australia. He also believes that the influx of skilled workers and contractors from overseas has had the opposite effect.

“When the borders open and Australia resumes the same policies as before, the impact of immigration on wages is likely to be small,” he said, however, he added that it would depend the type of immigrants granted visas. He also signaled that high levels of immigration would add more pressure on the housing market.

AMP Capital’s chief economist Shane Oliver said the border closures were leading to labor shortages in hospitality, accommodation and agriculture. But he said that didn’t seem to drive up wages more generally.

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Since the mid-2000s, net immigration levels have been around 240,000 per year, compared to previous levels closer to 110,000. He said this was “a major contributor to poor housing affordability. and constraints on infrastructure “.

Stephen Anthony of Macroeconomics has promoted skilled migration levels of 100,000 to 120,000 per year nationwide, but warned that doubling that figure and importing large numbers of low-skilled migrants would create a “real estate and industry Ponzi scheme.” education”.

Australian Council of Trade Unions economist Margaret McKenzie said the pandemic had revealed that many companies had used foreign labor to keep wages low, regardless of skills shortages.

“There must be an appropriate reassessment of areas where there is a real need for international contribution to skilled professions,” she said.

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