If you listen to Opposition Leader Bill Shorten in Labor’s current campaign against the 457 visa system, you could be forgiven for thinking the scheme was doing honest blue-collar Aussies in traditional industries like construction and manufacturing out of a job — taken by a foreigner brought in by an unscrupulous employer.

Abuse of the scheme is indeed extensive, and construction employers have been regular abusers of 457 visa and student visa systems to exploit foreign workers. And as we’ve seen from Caltex and 7-Eleven, retailers have also used the 457 and student visas systems unethically and illegally.

But a look at the numbers from 457 visa statistics shows that the scheme has been important in responding to a changing economy. In 2009-10, 457 applications, which had declined to 40,000 that year, were dominated by three industries: healthcare, ICT and construction. Manufacturing, previously a large industry for 457s, had applications more than halve to 2190; mining also fell significantly.

But the following year numbers rebounded again, to over 50,000. Construction and mining both surged as sources of applications, as did ICT. But manufacturing failed to recover ground again, and a hitherto small industry, professional scientific and technical services, surged to be almost equal to manufacturing.

Construction and mining both continued to grow rapidly as sources of applications in 2011-12, which rose to over 70,000. More than 13% of applications were for construction, easily the biggest industry, as the mining construction boom powered along. Mining rose more than 60%; health and ICT continued to grow steadily as well; even manufacturing rebounded, but professional services overtook manufacturing and another industry also appeared prominently: accommodation and food services (cooks now appeared as the sixth most common application).

[Protectionism turns its ugly gaze on 457 visas]

We can thus see the 457 system responding to the mining boom when it was needed, while longer-term trends continued changing the economy.

The next year, 2013, accommodation and food became the biggest source of applications and cooks the most common job; cafe and restaurant managers also appeared on the list of most common jobs. Construction was still strong, as well as the health and IT stalwarts, but manufacturing went backwards again. In 2013-14 there was a big drop in applications, by around 40%, reflecting the slowing economy; the main categories were now accommodation and food, health, ICT and professional services; manufacturing slumped further, over 40%, and mining declined significantly as well. The top two jobs were cooks, and cafe and restaurant managers.

457-visas-bk-final

In 2014-15, cooks were still king, along with programmers, though health marked time from the slump the previous year. Mining fell by nearly a third and construction failed to recover from the previous year, too; professional services was the second biggest industry.

And last year (when there were a total of 53,000 applications, around the same as in 2008), according to the most recent quarterly report cooks and programmers were still dominant; construction had fallen again, mining fell to almost negligible levels (just 2% of applications) and services continued its strong growth. Manufacturing was less than 5% of applications.

[How to employ more Aussies and reduce 457 visa rorting]

There are some micro and macro trends here: health has long been a big user of 457s but that has declined somewhat recently, whereas Australia’s IT sector remains a big user of the visas for its staff. As interesting are the macro trends: the mining industry understandably drifted off the 457 radar as the boom came to an end. Construction, too, is significantly lower, at its lowest point in the last eight years. But the use of 457 visas for professional services jobs has come from virtually nowhere to be one of the most important sources of visa applications. And the surge of cooks reflects the years-long growth of cafes and restaurants, which has resulted in that sector booming well ahead of the growth of other Australian businesses.

The numbers provide some grist for Labor’s campaign for more training and fewer 457s. The tech industry clearly continues to rely on 457s and any investment it has made in training Australians in areas like software development — which some in the industry complain doesn’t happen — has been dwarfed by the decline in Australian STEM (which, admittedly, both Labor and the Coalition have developed policies to address). But health — which is Australia’s biggest and frequently fastest-growing employer — is now bringing in fewer 457 visas than back in 2008 despite employing around 400,000 more Australians in that period.

And there’s no better illustration of the long-term shift in the Australian economy than how manufacturing is almost irrelevant for 457 visa applications, while professional services is now a key industry. The foreign workers attacked by Labor for stealing Australian jobs are very different to the blue-collar image its campaign conjures.

Peter Fray

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