How to improve migration for temporary migrants and Australia
Last September, the Albanese government commissioned it to find reforms to boost economic productivity, address issues like an ageing population, and make Australia more attractive to highly skilled migrants.
The hardest part is giving temporary migrants clear paths to permanent residency and citizenship. Given that temporary migrants outnumber permanent visas in Australia, this will be difficult.
An uncapped temporary migration program with a capped permanent program cannot offer all long-term temporary visa holders a path to permanent residency.
1.9 million people—7% of the population—live in Australia on temporary work visas.
A reciprocal agreement between Australia and New Zealand grants 680,000 New Zealanders visas. 1.2 million migrants include international students, temporary skilled workers, and working holidaymakers. Temporary visas are unlimited. Before the COVID-19 pandemic, the federal government issued about 500,000.
This exceeds the permanent visa limit. The Morrison government cut the cap from 190,000 to 160,000 places in 2019. For 2022-23, Albanese raised it to 195,000. The future is unknown.
Many temporary visa-holders want to stay in Australia. Most permanent visa recipients are in Australia on a temporary visa.
However, as more temporary residents apply for permanent residency, wait times are increasing and migrants' chances are decreasing.
42% of 2008 temporary skilled visa holders received permanent visas within four years. 36% of 2014 arrivals obtained permanent residency within four years.
Student visa holders suffered more. 25% of 2007 international students in Australia became permanent residents six years later. 12% of 2012 arrivals were permanent residents six years later.
Uncertain, longer paths to permanent residency cost individuals and society. They hinder migrants' productivity. For instance, a temporary skilled visa holder may want to switch jobs to better suit their skills but must stay put to qualify for permanent residency. We're wasting migrants' potential.
Employers prefer permanent residents over international graduates on temporary visas. This explains why 25% of temporary graduate visa holders are unemployed or not looking for work. Most qualified workers earn less than working holidaymakers.
Offering permanent visas to all long-term temporary migrants would require a massive, unpopular increase in Australia's permanent intake.
Even a modest permanent intake increase would increase housing costs.
Temporary visa caps would lower rents. However, it would also hinder some employers and reduce international student tuition.
For permanent visas, younger, skilled migrants should be prioritized. Temporary migrants should not be automatically granted permanent residency. A guaranteed pathway to permanent residency in Australia will attract more temporary visa holders and extend their stays.
We should also avoid creating new temporary visa programs for low-skilled workers in agriculture and the care economy because they increase demand for permanent visas.
Change selection criteria
The best permanent visa system chooses migrants who will help the nation succeed.
Current policy grants occupation-based permanent skilled work visas. This should change to whether migrants can earn a good wage—shown by a sponsoring employer paying at least A$85,000 a year.
Temporary migrants would no longer be subject to changing official occupation lists. Sponsored workers and employers know they qualify for permanent residency. If they can sponsor international graduates for permanent residency within two years, employers will be more comfortable hiring them.
To build their skills and careers in Australia before obtaining permanent residency, temporary skilled migrants should be allowed to work in any occupation if they earn more than A$70,000.
Points-tested visas, which many students use to gain permanent residency, could be improved. The current system rewards migrants for spending thousands of dollars on low-value courses or moving to regions with fewer job opportunities.
Instead, a single points-tested visa should award points only for traits that predict success in Australia.
The migration system should streamline permanent residency in Australia. However, not everyone can stay.
