Australia

Labor warned foreign worker crackdown won't help unemployed Australians and could make it worse

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Doubts have been raised about Labor's plan to overhaul the foreign worker scheme with employers warning it will lead to fewer local jobs, not more.

Labor's proposed crackdown on foreign worker visas will do little to help out-of-work Australians, business groups and employment experts have warned.

Announcing plans to raise the minimum wage for overseas guest workers and enforce skills shortage tests, Labor leader Bill Shorten said there were 1.6 million visa holders in Australia with work rights.

"Surely some of those jobs could go to Australians," he said.

While unions welcomed the proposed changes, the Australian Chamber of Commerce and Industry described them as a "body blow" for regional areas, if implemented.

"Migrants don't take jobs, they create them," ACCI chief executive James Pearson told SBS News.

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The hospitality sector is one of the biggest users of temporary skill shortage visas.
Getty

"If jobs aren't done, if they go unfilled, because Australians aren't available to do the jobs and we can't get people in from overseas ... then Australians miss out because that work won't get done and that means the other jobs that depend on that work being done will be at risk as well."

Senior lecturer at the University of Sydney Business School, Chris F. Wright, said Labor's proposed changes were a good step, but he also doubted they would lead to more jobs for locals. 

"There's no evidence that suggests that the visa system is taking jobs away from Australians," Dr Wright told SBS News.

"Focusing on immigration is a scapegoat for wider problems with labour market policy." 

Temporary skilled shortage visa numbers drop

While Labor has repeatedly cited the figure of 1.6 million visa holders who have work rights, that is mostly made up of university students, who can work 40 hours a fortnight during a semester, and working holidaymakers. 

Labor's proposed changes target temporary skill shortage (TSS) visas which account for just a fraction of that number. 

There are currently 136,000 overseas workers on TSS visas, which replaced the controversial 457 visas in 2017, with just 44,139 granted so far this financial year. 

The numbers have been dropping since the Turnbull government abolished the 457 visa over suspicions they were being used to import cheap labour. 

Under Labor's policy, businesses would have to pay foreign workers a minimum salary of $65,000, in line with the median Australian wage. 

Dr Wright said the increase was overdue given the threshold had been frozen since 2013.

He predicted it would cause some businesses to think twice about looking overseas, while some foreign workers would be paid more as a result. 

"An employer should be prepared to pay more if it's a genuine skills shortage," Dr Wright said.  

The ACCI slammed the nearly $11,000 increase in the threshold, which Mr Pearson said combined with a rise in a levy imposed on businesses, would make it unaffordable in some regional areas. 

"It's well, well above the minimum wage and you will find in many regional communities. It's going to be well above the award rate or the market rate that people are able to command for their skills in those regional areas," he said.

Current system 'failing'

Labor would also introduce a new authority to assess areas of genuine skilled shortage. 

The Australian Council of Trade Unions backed Labor's plan, saying that four out of five temporary skilled visas are given for occupations that don't have a skills shortage. 

“The system that the Morrison Government has overseen is allowing the mass exploitation of vulnerable workers who are often brought in specifically to reduce wages and conditions.

Labor says the current system allows employers to too easily hire foreign workers.
Labor says the current system allows employers to too easily hire foreign workers.
Migrant Worker Justice Initiative

“All employers should have to hire and train locally before they can use temporary work visas. They must provide proof of their actions."

The current system has been criticised as being too easy for businesses to claim they can't find a local worker to do the job. 

Dr Wright supported the need for a more rigorous assessment of skills shortages, arguing that just because one company hasn't been able to recruit an Australian worker does not indicate an industry-wide issue. 

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