Employment outcomes for permanent skilled migrants in Australia

Some interesting labour market numbers on permanent migrants from 2009-2011.

Employment outcomes (%) at 6 and 12 months for permanent skilled migrants (primary), 2009-2011

Visa category skilled Job other Job not working f/t work participation unemployment $A f/t median earnings
@ 6 Months
Employer sponsored 90 7 3 92 98 0.5 71,300
Family / state sponsored 60 31 9 72 98 7 50,000
Offshore independent 75 12 12 76 97 10 74,600
Onshore independent 55 37 8 69 98 6 44,400
Skilled graduates 58 36 5 65 98 3 40,000
All skilled 68 24 8 75 96 5 52,000
All family 21 28 18 33 28 67 43,000
@ 12 Months
Employer sponsored 91 7 1 93 99 0.5 75,000
Family / state sponsored 65 28 7 78 97 4 55,000
Offshore independent 83 10 7 85 96 3 79,000
Onshore independent 61 33 6 77 97 3 47,000
Skilled graduates 62 32 6 74 96 2 41,600
All skilled 73 22 6 81 96 2 56,000
All family 23 30 11 35 17 65 44,200

Source: Department of Immigration and Citizenship (2012), ‘The continuous survey of migrants’, in Lesleyanne Hawthorne and Anna To (2014), ‘Australian employer response to the Study-Migration pathway: The Quantitative Evidence 2007-2011‘, International Migration, 52(3)

(Note: these are only permanent residents and do not include migrants who hold 457 visas or other temporary visas)

Migrants who are sponsored by an employer, as should be expected, have very high labour market indicators. While labour market status 12 months does not tell us everything, the one per cent not working figure and 99 per cent participation rate, combined with the high salaries, are positive indicators. It would be interesting to see these figures at 24 and 36 months also. I would also be interested if there were substantial differences in outcomes between offshore and onshore sponsored migrants.

Family / state sponsored migrants have poorer outcomes than sponsored migrants. This is understandable. They don’t have an employer and by substituting some level of skill for family association in the visa process, this lowers the aggregate skill level for the visa category. That said, a 98 per cent participation rate with a $50,000 starting salary after 6 months is pretty decent. Nearly every other OECD country would be envious of those numbers.

The main concerns are from the onshore independent and skilled graduate visa categories. The labour market outcomes compared to employer sponsored migrants are much poorer. Most concerning is the percentage in a skilled job given these are skilled visas. This is followed by the percentage in full time work. While the outcomes improve markedly from 6 to 12 months, the salaries remain low. Hawthorne and To spell out some of the policy mistakes for student visas and why these numbers look the way they do in more detail.

In part because of the issues identified in these labour market numbers, policy change has occurred over the past couple of years. This will make it harder for international students without good English language ability and work experience to gain a permanent visa without being sponsored by an employer. Some may consider this unnecessarily harsh. After spending between two to four years on a student visa and another one to two years on a post-study work visa, some students may find themselves without recourse to residency.

However this is bipartisan policy. Skilled migration in Australia is designed specifically to improve the labour market via increasing human capital and filling skilled vacancies. If this is the overarching policy goal, at some stage, there needs to be a mechanism whereby migrants who do not fit this profile are prevented from gaining residency and leave Australia.

For policy-makers, these changes will take time to be effective. Outcomes will improve when knowledge about the policies is spreads and migrants who self-select Australia as a destination are better informed about the transition to residency. The key points to take away for migrants are a strong focus on improving English language skills to exceptional levels and gaining work experience in the labour market which will count towards the points-test (as a broad generalisation, this means office work instead of retail and hospitality work). Luckily, there is evidence to believe this dispersion of information will occur quickly. However until then, there will be a minority of international students who are bitterly disappointed at some point in the future as they are forced to leave after years of living in Australia.

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