March 19, 2009
CONGRATULATIONS to Immigration Minister Chris Evans for the best spin since Shane Warne was at his peak, but I suspect the minister might be surprised at how easy it has been to befuddle most of Australia’s media.
The “leaking” of the “14 per cent cut” in skilled migration on Sunday worked a treat, capturing the headlines on Monday and getting a second run with the official announcement that night on the box and in Tuesday’s fish wrappers.
Most of it, as Evans well knows, was misleading nonsense, just throwing the Construction, Forestry, Mining and Energy Union a bone to protect a few construction and building tradies, being seen to be doing something about rising unemployment, while actually having no meaningful impact on this year’s record migration surge.
Yes, Evans did announce a cut of 18,500 in the skilled permanent migrant category, “slashing” the intake by 14 per cent to 115,000. He might not have mentioned this still meant a 12 per cent increase on the previous year’s intake and represented a bare 5 per cent impact on total migration this year, that’s close to 350,000. Make that 332,000 now, still a record high.
The industry and union response was in tune with the Government’s intention of being perceived to be active in the hitherto missing policy area while not really rocking the boat or reducing the demand created by new migrants. There are uncomfortable truths about the mix of labour and migration policies in this recession, starting with the reality that the labour market is weakening from a strong base.
If you accept that the Australia of 4 per cent unemployment effectively had “full” employment, then our present 5.2 per cent nominal jobless rate really means 1.2 per cent. There were already doubts in the first half of last year about the sustainability of sub-5 per cent unemployment, if inflation was to be contained.
Less media coverage was given to total employment remaining flat. Admittedly, this was due to a surge in part-time jobs making up for the fall in full-time jobs, but in harder times, a job is a job. Even when unemployment reaches the 7 per cent forecast by the Government and major banks, it won’t be much above the level before Australia’s last recession.
As Evans admits, there are still areas where Australia lacks skills and must import the end-product of other countries’ investment in education and training.
Some people are losing jobs and more will, but in any historical context, we’re a long way from being in the crisis the politicians and headlines suggest.
The Government has caught itself in a trap by convincing the electorate before the last election that working families were doing it tough, when they really never had it so good. From such heights, any fall can seem steep.
Our real immigration numbers are much higher than the official immigration program generally reported. May’s budget boosted the “official” program places by 20 per cent to 190,300 – just to put this week’s cut of 18,500 in perspective – but there are another 160,000 not officially referred to as migrants. Kiwis, 457 visas and a few others are not part of the official migration policy.
It is not unreasonable to expect the number of dipthong stranglers from across the ditch will at least be maintained, some of them economic refugees, maybe finding work here in construction.
Last financial year, 34,491 Kiwis settled. There were another 1428 people in an unspecified “other non-program” category. And there are the subsection 457 guest workers who are the first to feel the chill winds of labour protectionism.
It seems 457 visas are down about 20 per cent in January and February, or about 100,000 people this year. I’d argue that the way 457s hold up is a better indicator of the real strength of the Australian labour market and our skills shortages and mismatches than what comes out of ABS labour surveys.
Michael Pascoe is a BusinessDay contributing editor.