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Increase skilled migration to 200,000 per year, says leading business group

One of Australia’s leading business groups has supported calls to increase skilled migration in the wake of the COVID-19 pandemic, pushing for the annual program to be expanded to 200,000 people.

The Australian Chamber of Commerce and Industry (ACCI) is calling for the near doubling of the skilled migration program to help secure the country’s economic pathway out of the pandemic.

Since Australia shut its international borders in March last year, business and industry have been grappling with a chronic shortage of workers. 

The ACCI on Tuesday released its “Better Australia” strategy outlining 10 goals aimed at improving the nation’s economic performance by 2050.

The group says migration targets must be set that address “severe” skill shortages and maximise economic outcomes as part of these reforms.

“A figure of around 200,000 skilled migrants a year is quite conceivable,” ACCI chief executive Andrew McKellar told SBS News.

“This is something that will actually help promote a stronger economy and boost jobs growth overall.” 

The CCI has said the figure compares to around 120,000-150,000 skilled migrants who would usually arrive in Australia in a normal year before the pandemic.

“One of the critical points here of course is how quickly our international borders will open up,” Mr McKellar said.

“[And] of course getting access to quarantine-free travel is going to be a key part of this solution.”

Speaking at an ACCI event on Tuesday, Treasurer Josh Frydenberg said the government is considering a rethink of the size and mix of the nation’s migration program.

“This will impact upon the economy, and including the ageing and the demographics of our population because we know that migrants tend to be of a younger age than the broader population,” Mr Frydenberg said.

“These are obviously issues that I’m thinking through and the government is thinking through, both in terms of the size and the composition of our migration program.”

The ACCI’s strategy outlines that governments across Australia must recognise the long-term benefits of both temporary and permanent migration.

“The skills, abilities and ideas of our migrants will build upon and enhance our human and natural capital,” the report reads.

“A sustained focus on younger, more skilled migrants will counter an ageing population and the expected reduction in the tax base and competitiveness.” 

Fitch Ratings this week suggested the “shock” to migration has the capacity to weigh on Australia’s potential GDP growth over the medium term.

This is expected to see Australia’s growth potential fall from 2.9 per cent a year to just 2.1 per cent a year, according to the credit rating agency.

“We do not expect pre-pandemic levels to be reached until 2023 and doubt immigration will surge in subsequent years to make up for the 2020-2021 shortfall,” it said.

New South Wales Premier Dominic Perrottet declared last week that he was in favour of a “big NSW” and wanted to work with the federal government towards boosting skilled migration.

The federal government’s advisory body on infrastructure has also indicated a migration boost is needed to address skilled labour shortfalls. 

Infrastructure Australia last week released a report finding that more migration will be needed to fill the forecast shortfall of 105,000 jobs.

But Abul Rizvi, former deputy secretary of the immigration department, has cautioned against “plucking numbers” out of “thin air” when considering the migration policy response.  

“Don’t start with a number – start with the policy problem – work out the size of the problem and then develop a response,” he told SBS News. 

“You need government to be calm and design a response on a good analysis of what the skill shortages are actually going to be.”

He said this needed to consider the range of “consequences” of any surge in migration numbers on demand for government services, infrastructure and where people would settle and housing.

“You have really got to think those things through before you just smash the immigration accelerator to the floor,” he said. 

The government’s Intergenerational Report suggested net overseas migration is forecast to reach levels of 235,000 people per year by 2024-25.

This follows an expected 97,000 people forecast to leave Australia in 2020-21 and 77,000 predicted to leave in 2021-22. 

The ACCI’s report also calls for a plan to decarbonise the economy to help incentivise business investment and meet international climate change commitments.

“What we’re calling for is bipartisan consensus around a clear commitment to net zero emissions by 2050,” Mr McKellar said.

“We think this is unquestionably in Australia’s national interests.” 

The ACCI report also warns that low productivity growth, low inflation, greater wealth inequality and low wage growth have constrained economic growth in Australia.

The group’s policy reforms suggest Australia must focus on ensuring legislated minimum conditions and on industry awards on minimum wages to address the concerns over stagnant wages growth.

It also calls for flexible and fair workplaces with secure jobs while boosting productivity towards “the next industrial revolution”.

Source: SBS News, 25 October 2021 – article by Tom Stayner

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