This concern with continued growth, and the demands of the resources sector, is behind a series of decisions that will ensure continued growth in migration levels.
The government has conducted a sustainability inquiry in the hope of mollifying concerns about the costs of urban growth. The final report of the inquiry, A Sustainable Population Strategy for Australia, makes a series of statements about the need for better urban planning and more financial assistance for infrastructure. However, the report provides no concrete recommendations about the size and skill make-up of the immigration intake, or about how the government might alter the settlement pattern of migrants. Under current migration rules the great majority of migrants are located in urban centres, making migrant settlement patterns a major challenge.
The lack of substance revealed in the sustainability exercise indicates that the government’s chief priority is to meet business demands. This priority was implicit in the 2011–12 budget statements. Here, the government announced an expanded permanent migration program and a net overseas migration (NOM) target of 180,000. This target was consistent with Treasury’s 2009 Third Intergenerational Report (IGR3).
The IGR3’s preferred, middle-range, population projection assumed that NOM would average 180,000 per year to 2050. The result was a projection of 36 million by 2050, from 22.5 million in 2010. At the time of the release of IGR3, this projection became known as the Big Australia outlook. Its release set off a debate about population policy which contributed to the political need for the sustainability inquiry.
The 180,000 NOM target has been criticised within business circles. This is because it is well below the actual NOM levels of recent years. There has been an explosion in NOM over recent years with a peak of over 300,000 reached in 2008–09. But the government has decided to reign in the major source of this peak, overseas students. It has done so by sharply diminishing the link between study in Australia and access to permanent residence via the skilled migration program, the major factor driving a surge in overseas student enrolments since 2005.
This decision was related to the policy of keeping NOM at about 180,000 a year. The government has decided that despite the importance of the overseas student industry as an export earner, it is expendable because it has made little contribution to assuaging skills shortages in Australia.
There has been some attempt to make Australia’s permanent residence migration program more responsive to employers’ needs, including those in the resource sector. But even under the reformed rules, employers located in the big metropolises have the same rights to sponsor workers under the permanent entry and temporary entry visa subclasses and there are few constraints on where migrants settle. There is a reluctance to change this situation because of the importance of population growth in the big cities, central to prosperity in recent years.
Instead, the government intends to satisfy the skill needs of the resource industries through the existing temporary worker program, the 457 visa. Currently, accredited employers (the requirements are easily met) can sponsor as many workers at trade level or above as they please to particular jobs for up to four years (renewable). There are strict limitations on the rights of the sponsored workers to move to another job with another employer. However, recent reforms, pressed by the trade union movement, mean that employers must pay market rates to 457 visa holders.
In a further move designed to provide for the resources industry, the government has decided to establish a variation on the 457 visa entitled Enterprise Migration Agreements (EMAs). The EMAs will allow resource projects of at least $2 billion, and with a peak workforce of at least 1500, to recruit 457 visa holders on concessional terms. These include the right to sponsor semi-skilled workers, such as scaffolders, riggers or bulldozer operators. The EMAs will permit sub-contractors on resource industry construction projects to import entire project workforces from the contractor’s overseas work sites.
There are many loose ends in these arrangements. As the number of 457 visa holders grow so will NOM. Many of these 457 visa holders will seek to stay permanently. Currently around half do, mostly through being sponsored by their employer under the employer-sponsored permanent entry program. This will push NOM upwards.
The long-term effect on the demand for labour from the resources boom is also uncertain. There is growing awareness that structural change induced by mineral and energy exports will add to competitive pressures on metropolitan businesses struggling with the appreciation of the Australian dollar. How this will play out by comparison with the positive impacts of resource industry expenditure and a strong dollar on the metropolitan labour market remains to be seen.
As the situation stands, the Australian Government is facilitating continued rapid population growth in the major metropolises through its maintenance of a high migration intake. As a result, it must simultaneously manage the demands for infrastructure and housing in these cities and the needs of the resource industries. The tensions between these goals have not been managed well, and it is not clear that anything will change in the foreseeable future.
Dr Bob Birrell is Reader in Sociology and the founding director of the Centre for Population and Urban Research, Monash University. He is also joint editor of the quarterly demographic journal People and Place.