Abbott must rethink immigration, not slash welfare

Immigration has accounted for 95 per cent of the nation’s jobs growth in the past three years. Cutting welfare benefits to Australian jobseekers without addressing our lax immigration policy is lunacy.

Australian politicians have embraced and run with the concept of a ‘Big Australia’, with population growth driving the economy since the onset of the global financial crisis. But with immigration crowding our Australian employment -- and our federal government slashing welfare -- is it time that we rethink our approach to immigration?

Australia’s immigration debate focuses mainly on the persecution of a remarkably small number of asylum-seekers. But there is mounting evidence that immigration by plane is posing a more pressing problem for both the Australian authorities and our domestic economy.

Yesterday Fairfax revealed explosive allegations of widespread visa fraud including granting visas to fake students. But our loose immigration policies have broader economic implications and highlight the federal government’s incoherent approach to welfare.

According to research by Dr Bob Birrell and Dr Ernest Healy, from Monash University, 380,000 recently arrived migrants have found jobs in Australia since 2011. By comparison, net job growth in Australia over that time was just 400,000 -- immigration has accounted for around 95 per cent of employment growth.

High levels of immigration have crowded out opportunities for Australian-born and overseas-born residents who arrived before 2011. The hardest hit have been younger people seeking entry-level positions and new graduates. The unemployment rate among people aged 15-24 years has climbed to its highest level since 1998. 

Graph for Abbott must rethink immigration, not slash welfare

It’s patently obvious that Australia’s immigration policies are at odds with the federal government’s crackdown on welfare recipients. When considered in tandem the only reasonable conclusion is that it amounts to lunacy.

It is absurd that a federal government can cut and delay unemployment benefits but also sabotage the unemployed via loose immigration policies. Making matters worse, the government plans to relax 457 visa requirements and has already begun phasing in its work-for-the-dole scheme in selected areas -- a system that often makes it more difficult for participants to get off welfare (Why work for the dole doesn’t work, July 28).

Clearly Australia’s immigration system has veered off course and no longer fulfils its stated purpose: addressing skills shortages. Immigration is no longer a complement to existing workers but a low-cost substitute.

Our immigration policies are now so loose and poorly enforced that addressing skills shortages is no longer a concern. In a recent report, the Department of Employment notes that “employers continue to recruit skilled workers without marked difficulty, and the number of occupations in shortage is at an historical low”.

Australia now imports record numbers of accountants and cooks, despite both occupations being in surplus. Nursing is another area where immigration is crowding our domestic graduates.

High population growth also places pressure on existing infrastructure and typically results in greater congestion on our roads and public transport. Not to mention the long-term effect on our natural resources and environment.

Furthermore, immigration appears to provide little benefit for the existing population, with the Productivity Commission noting that migration has improved Australian real GDP per capita only modestly.

There is nothing fundamentally wrong with high immigration -- or a ‘Big Australia’, for that matter -- but it requires a federal government with a firm goal in mind. Our economic plan cannot simply be ‘strong population growth’; rather, immigration should complement the pursuit of a broader economic goal.

Australia’s approach to immigration should be simple; it should be designed around enhancing the Australian economy. This will require a contextual approach, which will depend on the state of the business cycle.

When our economy is strong -- as it has been for the past two decades -- a high level of migration may help to offset skills shortages and contain wage growth. But when times start to get tougher -- as they have been doing over the past six years -- our priority should be putting a lid on domestic unemployment.

Needless to say it certainly isn’t reasonable for the federal government to maintain its loose approach to immigration, while simultaneously tightening welfare eligibility. That amounts to cruel and unusual punishment for a group of Australians whose greatest crime is a failure to find jobs that don’t exist.