A delicate and sometimes difficult topic, this immigration business in general and 457 visas in particular.
On the big picture, anti-immigration green types will rejoice in a Monash University study claiming we have Buckley’s chance of meeting our greenhouse gas reduction by 2050 if we’ve also increased our population to 30 million by that date.
While on the “guest worker” front, Minister Chris Evans tells us his department issued 110,570 section 457 visas in 2007/08, some 27 per cent more than the previous year.
And 457s are now being processed faster than ever with three dedicated “Centres of Excellence” flying through the backlog of applications. Visas are now being granted at a rate of more than 10,000 a month. In June, 1,200 of those visas took less than a week to process.
As the Minister correctly notes, “the increase in the subclass 457 visa grants highlighted the importance of the program in delivering skilled labour to employers across a wide range of professions and industries.”
It also helps reduce inflation by keeping down wages in at least some select industries.
And, with the economy coming off the boil, the matching of 457 visa applicants with areas of particular skills shortages is somewhat less than laser sharp, if only because 47 per cent of those 110, 570 visas were for “secondary grants”, i.e. dependents, who themselves have a very high workforce participation rate in whatever field they fancy.
This is a good thing for the economy overall. It’s a very good thing for employers in areas where there are crucial skills shortages and it’s fine for those of us who work in occupations excluded from 457 competition — truck driving for example.
It’s not so good for workers in the lower half of the pay spectrum who lose bargaining power when positions are filled by 457 visa holders — mechanics for example.
The minimum annual wage for a primary 457 visa applicant is $41,850. (That base will be increased on August 1 to $43,440, the first rise in a couple of years.)
I recently met a young mechanic with the usual mortgage and a wife about to have their first child and therefore about to drop out of the paid workforce for a while. His weekly take-home pay packet is 700-and-some dollars. He tells me there are good mechanics leaving his industry to pick up an easy $1,000 a week just driving a truck because they can’t get a pay rise doing what they have trained to do. There are other mechanics who leave the suburban service centres for bigger wages in the resources industry.
Mechanics leaving the industry should lead to a shortage and, the laws of supply and demand being what they are in a free market, the price of mechanics should rise.
But there are good mechanics from third-world nations happy to take base 457 wages here and do so. The guest worker system is also proving a good gateway to permanent residency — nearly 25,000 subclass 457 visa holders became permanent residents last year. Those permanent places come from within the government’s annual permanent visa quota.
A mechanic who goes truck driving won’t face competition from the 457 visa system. The TWU has lobbied to exclude truck driving from the list of possible 457 occupations and the Rudd government accepted the recommendation of an industry working group established under the previous administration to exclude the “driver” category from the 457 process.
It’s important to chose your occupation carefully — and perhaps to have a strong union.
How the bloke on $700 or $800 a week with a mortgage and a child on the way can cope, well, who wants to pay more than they do now to have their car serviced?