Coronavirus: ‘We have workers to plug the skills gap’

Australia has an under-employed pool of at least 150,000 workers that could help fill the yawning skills gap, demographer Peter McDonald says.

Demographer Peter McDonald.

Australia has an under-employed pool of at least 150,000 workers that could — with a few small policy tweaks — help fill the yawning skills gap being created by the international border shutdown, demographer Peter McDonald says.

With net overseas migration anticipated to fall by 270,000 people between the start of the COVID outbreak and June 2021 as a result of border closures, the economic hit could reach $40bn a year, The Australian revealed on Monday.

By better using about 100,000 international graduates still in Australia and 50,000 spouses of Australian citizens who don’t have permanent residence, some of that economic loss could be clawed back, Professor McDonald said.

“Border closures have made it near impossible for Australian employers to recruit skilled workers from overseas but there are temporary residents who, with some tweaking of policy, could fill these gaps,” he said.

These include 97,000 people on Temporary Graduate visas (as at March 30) who are entitled to remain in Australia for between two and four years, are able to work full-time and are encouraged to work in the professional area of their ­degree. Many hope for permanent residency.

“They often face a Catch-22 situation where employers would be happy to employ them but only if they are permanent residents,” Professor McDonald said.

“Because of this, less than half work in jobs that match their professional qualifications. In addition, eligibility for the ‘independent’ category of skilled migration requires more years of experience in their profession than the standard graduate is able to ­obtain on a graduate visa, even when … employed in their profession.

“These blockages to employment and permanent residence of Australian-trained, qualified professionals do not advantage Australia during the COVID-19 crisis when it is very difficult for employers to recruit skilled professionals from overseas.”

Another under-utilised cohort is the 50,000 spouses of Australian citizens who are sitting on bridging visas and waiting, on average, three years for the permanent ­residency that is more attractive to employers.

“While many are highly skilled, they face the same obstacles to employment that graduate visa holders face. Employers are reluctant to hire them because they are not permanent residents,” Professor McDonald said.

“(And) if they want to study to have their qualifications recognised in Australia, they are forced to pay international student fees.

“These are people who have a legal right of permanent residence in Australia — in present circumstances, further delay of recognition of their legal status is not in Australia’s interest.”

Professor McDonald said the skills gap didn’t end there, with an unknown number of people on bridging visas who are applicants for skilled permanent residence and whose situation is similar to those on graduate visas.

Speaking to The Australian on Monday, leading economist Chris Richardson from Deloitte Access Economics said the loss of migrants as a result of the COVID-19 border shutdown could be as much as 2 per cent of the value of the economy, a figure in the order of $40bn.

Migrants have in recent years contributed about two-thirds of overall population growth, but because many are of working age, they also generate higher than ­average workforce participation and productivity.

The growth attributable to ­migrants will substantially reduce with the border shutdown, which is projected to see just 35,000 net overseas migration next financial year.

Economic modelling has shown Australia requires between 160,000 and 210,000 NOM to maintain GDP per capita growth.

John Daley, chief executive of policy think tank the Grattan Institute, said another way to reduce the economic pain resulting from the COVID-induced fall in net overseas migration was to find a way to quickly and safely reopen the country to international students, particularly Chinese students.

“This is a huge opportunity for us to take a greater share of the market,” he said. “Our competition is the UK and the US, and they don’t look too flash at the moment.”