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Reserve Bank policy and Recent immigration impact on Australian workforce

Luci Ellis, Assistant Governor of the Reserve Bank (Economic), is very pro immigration. Some have wondered whether she may be making the running on this question behind the scenes more than is Philip Lowe, the Governor. Recent migrants may be somewhat more likely to hold degree-level qualifications than locals but this does not mean that their professional qualifications are well suited to the Australian labour market. (We should also ask ourselves, what is it about the Australian education system that makes Australians less likely than some immigrant streams to hold degree-level qualifications?)

She bases her position on migrants being younger on average than locals and better qualified than locals. See https://www.rba..gov.au/speeches/2017/sp-ag-2017-11-15.html

In recent years migrants may, overall, be more likely to hold degree-level qualifications than locals but this does not mean that they have professional qualifications that are well suited to the Australian labour market.

See Bob Birrell and Ernest Healy, "The Impact of Recent Immigration on the Australian Workforce," Centre for Population and Urban Research, Monash University, Melbourne, February 2013 (especially pp. 10-11). This is online at https://tapri.org.au/wp-content/uploads/2016/02/birrell-healy-feb-2013.pdf.

They find that of Australian-born graduates aged 25-34 at the 2011 census, 11% had managerial positions, 58% had professional positions and 9% were not employed. (The remainder were spread across a number of other occupations including sales, drivers, labourers etc.)

Of English-speaking background-born (ESB) graduates aged 25-34 who had arrived between 2006 and 2011, 12% had managerial positions, 53% professional positions and 12% were not employed. So they were able to use their skills almost as readily as the Australian-born graduates.

But of non-English-speaking background-born (NESB) graduates aged 25-34 who had arrived between 2006 and 2011, only 4% had managerial positions, 26% had professional positions and 31% were not employed. The remainder were spread across a range of occupations including sales, drivers, labourers etc.

And NESB-born people dominate the migrant intake. For example, of the total of 201,926 overseas–born graduates aged 25-34 in 2011, and who had arrived between 2006 and 2011, 79% were NESB-born.

Thus bringing in people with paper qualifications does not necessarily mean that they are readily employable in highly skilled jobs. Whatever the source of their bias on the matter, perhaps the RBA should look at the data a little more closely.

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