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Between Supply and Demand: Permanent Skilled Migration to Australia
Abstract
Research on skilled migration has dealt overwhelmingly with the contribution of migration to productivity growth, to changes in the income of migrants and the factors influencing their employment. Much less attention has been paid to the institutional mechanisms that mediate between the external supply and the host-country demand for skilled labour, even though these play a vital role in the selection of such migrants. Australia has maintained a selective, highly regulated permanent skilled migration program for much of its contemporary history. This program contains both general and specific skilled entry. The former is not linked to any particular needs of individual firms or industries. Rather, in seeking some balance between supply and demand, entry is on the basis of general criteria such as the possession of a qualification recognised in Australia and English-language proficiency. Short-term imbalances between the supply of general skills and occupational demand have led to changes in entry criteria in response to labour market information and pressure from professional associations and trade unions. Specific skilled migration is closely tied to employer nominations. They cannot proceed unless certain institutional processes are met. The firm concerned must demonstrate that the required human capital cannot be found in Australia, that the position is in fact a highly skilled one, and that the firm has a training strategy for Australians.
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Notes and References
M. Wooden, Migrant Labour Market Status, Australian Government Publishing Service, Canberra, 1990, p. 14.
J. Collins, Migrant Hands in a Distant Land: Australia's Post-War Immigration, Pluto Press, Sydney, 1988, pp. 5–6, 77–86.
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Committee to Advise on Australia's Immigration Policies, Immigration: A Commitment to Advise on Australia's Immigration Policies, Australian Government Publishing Service, Canberra, 1988, pp. xi-xv.
See Department of Immigration and Ethnic Affairs, Population Flows: Immigration Aspects, Australian Government Publishing Service, Canberra, 1996. In assessing skill level the Australian Standard Classification of Occupations (ASCO) Dictionary produced by the Australian Bureau of Statistics, occupations are categorised into eight major ASCO groups depending on the skill level of an occupation as a function of the range and complexity of the set of tasks involved. It is measured by the amount of formal education, on-the-job training and previous experience usually necessary for the satisfactory performance of this set of tasks. These eight major groups are managers and administrators; professionals; para-professionals; trades persons; clerks; salespersons and personal service workers; plant and machine operators and drivers; and labourers and related workers.
See generally G. Withers, ‘The immigration contribution to human capital formation’, in D. Pope and L. Alston (eds), Australia's Greatest Asset: Human Responses in the Nineteenth and Twentieth Centuries, Federation Press, Annandale, 1989, pp. 53–54, 66.
See for example B. R. Chiswick, ‘The effects of Americanization on the earnings of foreign-born men’, Journal of Political Economy, 86, 5, 1978, pp. 897–92; ‘Speaking, reading and earnings among low-skilled immigrants’, Journal of Labor Economics, 9, 2, 1991, pp. 149–70; and B. R. Chiswick and P. W. Miller, ‘Language in the immigrant labor market’, in B. R. Chiswick (ed.), Immigration, Language and Ethnicity: Canada and the United States, American Enterprise Institute, Washington, 1992, pp. 229–96.
George Borjas, ‘Assimilation, changes in cohort quality, and the earnings of immigrants’, Journal of Labor Economics, 3, 4, 1985, pp. 463–89. See also R.J. LaLonde and R. H. Topel, ‘The assimilation of immigrants in the US labor market’, in G.J. Borjas and R. B. Freeman (eds), Immigration and the Work Force: Economic Consequences for the United States and Source Areas, University of Chicago Press, Chicago, 1992, pp. 167–99; and Andrew Yuengent, ‘Immigrant earnings relative to what? The importance of earnings function specification and comparison points’, Journal of Applied Econometrics, 9, 1, 1994, pp. 71–90.
For the link between English-language proficiency and earnings in the United States, see Gilles Greiner, ‘The effects of language characteristics on the wages of Hispanic American males’, Journal of Human Resources, 19, 1, 1984, pp. 35–52; Walter McManus, William Gould and Finis Welch, ‘Earnings of Hispanic men: the role of English language proficiency’, Journal of Labor Economics, 1, 2, 1983, pp. 101–0; Evelina Tainer, ‘English language proficiency and the determination of earnings among foreign-born men’, Journal of Human Resources, 23, 1, 1988, pp. 108–22; and Chiswick, op. cit.
See for example James Smith, ‘Hispanics and the American Dream: an analysis of Hispanic male labor market wages, 1940–1980’, Rand Corporation, 1992; and LaLonde and Topel, op. cit.
For research on immigration and unemployment, see Kosmas Tsokhas, ‘Immigration and unemployment in Australia’, International Migration, 32, 3, 1994, pp. 145–66. For links between skilled immigration and productivity and economic growth, see, for a recent example, George Borjas, ‘The economic benefits from immigration’, Journal of Economic Perspectives, 9, 2, 1995, pp. 3–22.
For economic discussions of the demand function see, for example, Richard B. Freeman, ‘Immigration from poor to wealthy countries: experience of the United States’, European Economic Review, 37, 2–3, 1993, pp. 443–51.
Claudia Goldin, ‘The political economy of immigration restrictions in the United States, 1890–1921’, in Claudia Goldin and Gary Libcap (eds), The Regulated Economy, University of Chicago Press, Chicago, 1994, pp. 223–58. Also, for earlier Australian work, see A. C. Kclley, ‘International migration and economic growth, Australia: 1865–1935’, Journal of Economic History, 25, September 1965, pp. 333–54; A. C. Kelley and R. M. Schmidt, ‘Modelling the role of government policy in post-war Australian immigration’, Economic Record, 55, June 1979, pp. 127–35; and J. Caddy, E. E. Jackson and A. A. Powell, ‘Determinants of Australian migration’, IMPACT working paper B-07, Melbourne, June 1978.
G. Becker, Human Capital, National Bureau of Economic Research, New York, 1964, p. 26.
For a more wide-ranging discussion see Kosmas Tsokhas, ‘Managerialism, politics and legal bureaucratic rationality in immigration policy’, Australian Journal of Public Administration, 55, 1, March 1996, pp. 33–47.
For an introduction see M. Kabala, ‘Immigration as public policy’, in J. Jupp and M. Kabala (eds), The Politics of Australian Immigration, Australian Government Publishing Service, Canberra, 1993, pp. 10–11, 17.
In July 1995 the Concessional Family category was renamed the Australian-linked Skilled category.
See generally J. J. Beggs and B.J. Chapman, ‘The international transferability of human capital: immigrant labour market outcomes in Australia’, in L. Baker and P. Miller (eds)) The Economics of Immigration: The Proceedings of a Conference at the Australian National University, Australian Government Publishing Service, Canberra, 1987; Bureau of Labour Market Research, Migrants in the Australian Labour Market, Research Report No. 10, Australian Government Publishing Service, Canberra, 1986; B.J. Chapman and P. W. Miller, ‘An appraisal of immigrants labour market performance in Australia’, in M. E. Poole, P. R. de Lacey and B. S. Randhaura (eds), Australia in Transition: Culture and Life Possibilities, Harcourt, Brace Jovanovich, Sydney, 1985; P. A. Inglis and T. Stromback, ‘Migrants’ unemployment: the determinants of employment success’, Economic Record, 62, 1986; and M. Wooden, Migrant Labour Market Status, Australian Government Publishing Service, Canberra, 1990.
Bureau of Immigration and Population Research, Immigration Update, March Quarter, Australian Government Publishing Service, Canberra, 1993.
This may be affected by national competition policy deregulation of the professions and trades.
Beggs and Chapman, op. cit., and Wooden and Robertson, op. cit.
See B. Goddard and T. Waters, ‘The contender—broad-based skill migration—knock-out or decision on points?’, Australian Population Association Conference, Sydney, 28–30 September, 1992; and R. Birrell, Migration Selection During Recession, Parliamentary Research Service Background Paper Number 3, 1992, pp. 21–26.
Compiled from Department of Immigration and Multicultural Affairs, Migration Program Management System database.
Department of Immigration and Ethnic Affairs, Procedures Advice Manual, Department of Immigration and Ethnic Affairs, Canberra, 1993, chapter 10, pp. 17–24.
M. Baker and M. Wooden, Immigration and Training, Australian Government Publishing Service, Canberra, 1992.
Withers, op. cit., pp. 68–69.
AMPT Applied Research, Employer Nomination Scheme Survey, Report to the Population and Research Branch, Department of Immigration and Ethnic Affairs, Canberra, May 1986, pp. vi, 17.
A. Kan, The Australian Experience of Skilled Migration: The Employer Nomination Scheme in the Manufacturing and the Finance, Property and Business Services Sector, Australian Government Publishing Service, Canberra, 1991, p. 28.
Department of Employment and Industrial Relations, Department of Immigration and Ethnic Affairs, Report of the Joint Review of Employer Nomination Scheme and Temporary Residence Arrangement, Canberra, March 1985, p 17.
See, Department of Immigration and Ethnic Affairs, ‘Pilot survey of the employer nomination scheme’, 1989, unpublished; AMPT Applied Research, op. cit., pp. 16, 40; Kan, op. cit., pp. 19, 25.
AMPT Applied Research, op. cit, pp. iv, 6, 21, 39–41; Kan, op. cit., pp. 27–28.
AMPT Applied Research, op. cit., p. 37.