An update on the Australian Seasonal Worker Program: Good, bad, ugly

New data for the Seasonal Worker Program is available. Unfortunately this stuff seems to be a little bit difficult to access. There is no stats page (which I can see) on the program website. The figures below come from a powerpoint presentation given by a Department of Employment executive at a recent conference.

To recap: the Seasonal Worker Program encourages labour mobility from Pacific countries allowing Pacific citizens to work in Australia. Income from this feeds back into their home communities, with demonstrated benefits for local economic development.

Table 1: Visas granted (program utilisation in brackets)

2012-13 2013-14
Program 1454 (91%) 1979 (99%)
Trial 19 (5%) 35 (7%)

Overall use in the program is growing. The program cap for 2012-13 and 2013-14 was 1600 and 2000 respectively. The growth means program utilisation went from about 91 per cent to 99 per cent. This is very good. We should not undersell this growth. This is a positive sign moving forward for the program and for Pacific island countries who are extremely interest in labour mobility. I’m aware of projects in Timor-Leste and Tuvalu examining how to better foster this mobility from sending countries, two countries where traditionally emigration hasn’t been on the policy agenda.

Less beneficial is the presence of a program cap. If growth continues and visas for 2014-15 look like exceeding the cap, this should be allowed to occur, sustaining good progress on a program which has been troubled in the past. For context, the New Zealand equivalent program has filled 8000 places for the past couple of years for a small labour market. However this appears unlikely given the following note included in the powerpoint:

I might add that to date, the Department of Employment has not had to take steps to control demand, which it may have to consider if demand for seasonal workers was expected to exceed the caps. These steps may include closing the application process to become an approved employer for a period of time. (Powerpoint file supplied by Department of Education, titled “Mark Roddam”)

Closing off the program to potential new employers would be one of the worst policy decisions to impact the program. This would choke off growth and stifle program outcomes regarding economic development. The irony of watching the Department of Employment make a decision to actively prevent employment…

The poorest outcome from the data is the rate of program utilisation for non-horticultural industries. These results are abysmal. This is the second year of a three year trial period and at this point, any learning from these pilots is going to be limited. If non-horticultural industries are excluded from the Seasonal Worker Program proper after the conclusion of the three year trial based on these results, policy-makers will be making a decision based on flawed evidence.

The inability of program managers to successfully integrate industries such as accommodation, cotton, aquaculture and cane into the Seasonal Worker Program is a policy failure. Blaming employers for such a low take up rate is incorrect given nearly every single employer in these sectors appears to have chosen not to take part. This signals the blame lies elsewhere.

Table 2: Visa grants by country of origin (proportion of total in brackets)

Country 2012-13 2013-14
Tonga 1199 (82%) 1497 (76%)
Samoa 22 (1%) 162 (8%)
Kiribati 34 (2%) 14 (1%)
Papua New Guinea 26 (2%) 26 (1%)
Solomon Island 42 (3%) 9 (<1%)
Timor Leste 21 (1%) 74 (4%)
Vanuatu 119 (8%) 212 (11%)
Nauru 10 (1%) 0 (0%)

Country of emigration shows a marginally improving situation. Most countries have only a handful of migrants making the trip to Australia. Tonga continues to provide a large majority of all seasonal workers. However there was a slight decrease in terms of proportion in 2013-14.

Samoa, Vanuatu and Timor-Leste all recorded improvements. Hopefully there are lessons being learnt here, allowing better policy implementation in both these countries of origin and in Australia.

Unfortunately, the Solomon’s and Nauru stand out as countries unable to access to program. This is likely for a variety of reasons, including a lack of capacity within those countries to meet the standards required by Australian policy-makers. PNG also went backwards in terms of proportionality despite the same (low) number of migrants making the trip. Given the population of PNG is well above all the other countries combined, this appears to be a long-term issue. Building capacity within PNG should be amongst the highest priorities. This is particularly true when we consider other immigration policy decisions occurring in PNG.

Overall, I think this data for 2013-14 should be viewed as cautiously optimistic with the major caveat being the lack of progress in the trials.

The rise in total visa grants mean the program is heading in the right direction. While there is the potential this could be stymied in coming years, there remains time to address this particular issue. The increase in migrants from Samoa and Timor in particular is positive. Embedding processes enabling the use of the Seasonal Worker Program in Pacific countries is the most important piece of the puzzle for long-term success. The more countries heading in the right direction will build future capacity, instead of relying solely on migrants from one or two countries.

This does not mean there aren’t improvements to be made. More visas will be granted if the burden on employers to use the program is reduced and by the adjustment of other visa regulations, such as those governing the working holiday maker program. New industries have to be incorporated into the program for serious long-term success to be realised. 2014-15 will be make or break in this regard.

(Note: You can email and ask for the 2014 SWP conference presentation files to access this data and other presentations)

An early celebration: 20 Timor Leste citizens head to work in Australia

The press release is title, “Timor-Leste Seasonal Workers depart for the Northern Territory”.

20 citizens from Timor Leste are departing to work in the Northern Territory under the Seasonal Work Program. Since 2012, “more than 80” Timorese have made the same journey.

Good luck to these people and it is heartening to see at least some people migrating under the Seasonal Work Program.

But this media release perfectly sums up what is wrong with the program. 80 people in two years from one of the poorest countries in the region is a terrible outcome. We should be celebrating hundreds, not handfuls, of people.

Hopefully the Chief Minister of the NT, the Australian Ambassador and the head of the Timor-Leste Employer department, each who attended the ceremony, have also advocated to the federal government about the flaws of the program and are thinking about ways they can each improve it.

Instead of success, this type of media release highlights how far is still to go regarding Pacific seasonal migration in Australia and a reminder about how public policy that does not have a political champion will often fail to meet expectations. The contrast with New Zealand’s seasonal worker program continues to be stark.

I would have penned a media release beginning with,

“While we managed to provide 20 citizens the opportunity to earn 8-10 times the local wage, we have not done enough for those who remain unable to migrate.”

Perhaps the next time we can be a little more honest.

For those interested, I broadly agree with most of the stuff on Devpolicy regarding the seasonal work program.

The role of the government for emigration and development: Timor-Leste

Typically, the migration and development agenda is stifled by governments and public opinion in OECD countries. Wary of the impact on economies, labour markets, society and culture, the rich developed world has rather entrenched values about mass immigration from poor countries. However, there are more limited examples of where developing country governments have not put in place the right set of decisions to exploit emigration opportunities.

Starting in 2008, Timor-Leste and South Korea have maintained a bilateral relationship for Timorese citizens to work in South Korea. This paper from March 2014 outlines progress and roadblocks encountered since.

The most disappointing part is this:

In the first phase, the Government of Timor-Leste through SEPFOPE sent 50 workers to South Korea. In 2011 the South Korean Government was asking for 2,500 workers, but Timor Leste was only offering 400 workers; in 2012, South Korea raised the number of employees reached to 2750 people, Timor Leste once again releasing only 500 workers. In 2013 the South Korean government demanded workers jumped up to 3,500 people, but the number which derived from the Government of Timor-Leste only reach to 280 workers.

7570 positions left unfilled in just three years. If each additional emigrant sent home $5,000 per year for their work, this is equivalent to $37,500,000 in lost remittance income. For a country of just over a million people with a GDP per capita of just US$1,068, this is a lot of money, equivalent to over 3 per cent of GDP.

Of course, there are some explanations.

To participate in the program, you must pass a Korean language test. At first, I thought this must have been Korean government policy. Except:

“SEPFOPE (a Timor-Leste government agency) has its own criterias that should be met by prospective workers to South Korea such as attending Korean language course in a few months: in fact, many workers did not pass the final exam” (Alves.P 2014).

The language test appears to be Timor government policy, not Korean. Given the potential lost income, this seems a high barrier to entry in terms of emigration. Of course many workers do not pass the final exam, presumably because its extremely difficulty to learn Korean in Timor-Leste. I’m pretty sure I couldn’t pass the test, even with an enormous amount of time invested in learning Korean.

Further, the fact the program numbers have been going backwards is a poor sign for future outcomes.

The Timor government and SEPFOPE need to do more to ensure these opportunities are not wasted in the coming years. It is pleasing to see the problems identified in this report (the lack attendance to classes, the difficultly of Korean instruction in local dialects and the lack of priority the program receives from the government). Hopefully this has set in train a process where the number of Timor emigrants can increase. Perhaps the standard of Korean could be revised downwards for some participants and monitored for any adverse consequences.

The total remittance flow to Timor was just under $3m for 2013. For a country of over a million people, this is not a large amount relative to many of developing countries. Remittances will not solve development in Timor, yet they will assist the overall trend towards better economic growth and living standards.

One of the major issues is the lack of emigration to Australia. While over a thousand workers were in South Korea in 2012 (the work visas appear to be longer a year, with overlap of annual placements), a paltry 29 made it to Australia last year under the Seasonal Work Program. This is frankly embarrassing for both governments. Timor-Leste is one of the poorest countries in the world and Australia one of the richest. The lack of built in support and facilitation of the Seasonal Work Program is something which should be rectified as soon as possible, otherwise it will simply remain an under-subscribed immigration program, useless to regional employers and potential emigrants, angering Pacific governments and an excuse for the Australian government to point to something and say, ‘see, look!’.

English language should be easier than Korean given the residual level of English knowledge in the country . Further, the existing links between Australia and Timor, while seriously frayed at the current time, should make for a more smooth facilitation of emigrants over time. What is really required are a handful of major employers to participate in the program. The Accommodation trial in the seasonal worker program, with eligibility for the entire state of Western Australia and Northern Territory, would be a good place to start.

Timor-Leste should push harder on this. Lobby the Australian government. Contact large hospitality employers in Perth. Harass DFAT about the red-tape inherent in the program. The cold politics of the current relationship should see Australia looking for avenues in which to be more amenable. While this is small fry compared to oil and gas revenue, it is an example of where a small amount of support could transform the flow of people from a rounding error to something more substantial.