Prior to the last election, Boris Johnson pledged to “take steps to ensure that the Australian-style immigration system is in place … by lowering the number of unskilled immigrants who have been able to come here with no jobs lined up, the system will remove a major force that puts downward pressure on wages”.
Priti Patel, now Home Secretary, said the Australian system “will give us control over who can come … we will be able to attract the best and brightest and bring down overall numbers”.
For those of us who follow the details and consequences of Australia’s immigration system closely, these are big claims. They are also claims that don’t really stand up to scrutiny. There are plenty of weaknesses to Australia’s immigration policy, particularly in respect of temporary migrants.
Under my leadership, a majority Conservative government will implement an Australian style, points based immigration system. pic.twitter.com/ehVYxEsb7W
— Boris Johnson (@BorisJohnson) December 8, 2019
Before I outline these weaknesses, it’s worthwhile summarising the key features of the pre-Brexit immigration situation. On the most recent figures, there were about 3.6 million EU-born migrants living in the UK, making up more than 5 per cent of the population. In the decade and half ending in 2019, the number of EU-born migrants to the UK had risen by more than 250 per cent.
In terms of the workforce, EU-born migrants made up close to 8 per cent of the total in 2019, reflecting their high rates of labour market participation. The most common source countries were Poland, Romania and Ireland.
Successive UK governments have battled to rein in the migrant intakes, in part because EU citizens have had the unfettered right to come to the UK. Mind you, it’s not always been clear just how many migrants have been arriving (and leaving) because the data collection systems in the UK have been, and still are, deficient.
The net overseas migration figure (long-term arrivals over long-term departures) seemingly peaked at about 330,000 in 2015 — the UK population is 66.6 million — before dropping to about 250,000 between 2016 and 2019.
Interestingly, the NOM figure of 250,000 per year is not dissimilar to those recorded in Australia in recent years, but Australia has a population of only 25 million. On this basis, it is easy to argue the UK actually controlled its migrant numbers better than Australia. Immigration makes a much larger contribution to population growth here than in Britain.
Sensing the problem for the British economy would be the large number of EU-born citizens set to depart en masse, the UK government has in effect grandfathered their right to stay and work. What is evident is that many of these migrants work in jobs that the locals are either ill-equipped to do or simply refuse to do. There are parallels with the Australian situation here.
So what are the real lessons of Australia’s immigration policy framework for the UK? The firm belief seems to be that our system is highly focused on skilled migrants resulting from a points-based test, and the number of new migrants is tightly controlled.
Neither proposition is correct. The way to think about Australia’s immigration system is to divide it into three parts: the capped permanent migrant intake (mainly skilled and family); the capped humanitarian intake (set at 13,750 per year); and the uncapped temporary migrant intake, excluding tourists. The last category is mainly made up of students and graduates, temporary workers and working holiday-makers.
Prior to COVID-19, the expectation was that the permanent intake would be set at 160,000 — a slight reduction on previous years. Of these, nearly 80,000 would come from the skilled category and just over 77,000 would be family.
In terms of the skill category, there are two important catches. First, the strictest points test applies only to skilled independent migrants, and the number for this intake has been set at 6500. The other skilled intakes — employer-sponsored, regional and state/territory nomination — have much weaker skill testing attached to these migrants.
Second, secondary applicants (mainly spouses) are not subject to points assessment but are included in the sub-quotas. The Productivity Commission has demonstrated that these secondary applicants are less qualified and English-language proficient than the primary applicants and are much less likely to participate in the workforce. The notion that we attract the “best and the brightest”, to use Patel’s words, is something of a stretch.
Moreover, analysis undertaken by Dr Bob Birrell has shown that only a quarter of the overseas-born graduates aged 25 to 34 who arrived in Australia between 2011 and 2016 were working in professional occupations. This compares with 58 per cent of Australian-born graduates of the same age.
When it comes to Australia’s NOM, the largest single group in recent years has been international students. In 2018, for instance, students made up nearly 44 per cent of the total figure. There has also been very significant growth in the number of graduates staying on, with the number of Temporary Graduate Visas increasing from just over 20,000 in 2014 to more than 70,000 in 2019.
Boris Johnson’s proposition that Australia’s immigration system “removes a major force that puts downward pressure on wages” is also not supported by the facts. The correlation is clear in Australia: just when NOM in Australia began to increase after the global financial crisis, wage growth began to sink, with the wage price index struggling to reach increases of more than 2 per cent per year. In other words, higher net migration has been associated with falling wage growth.
The bottom line is that Australia’s immigration system is a mishmash of different arrangements that are primarily designed to serve particular interests — think employers, universities, particular states and regions, and a number of lobbying groups.
A high migrant intake is also strongly supported by the federal Treasury.
The centrality of the points system was lost long ago, with the uncapped components now the principal drivers of the total number of migrants. The UK should think carefully before following our example.
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