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To train or not to train: that is the question. Whether 'tis nobler in the mind to import highly skilled workers, or to suffer a flood of unskilled labour to allow Australian workers to (eventually) haul themselves up the skills ladder…

This question is posed in more prosaic terms (and with less offence to Shakespearean scholars) in a new report by the Productivity Commission – the result of a roundtable policy discussion featuring senior government officials, academics, consultants and representatives of non-government organisations.

While the report covers a host of population issues pertinent to the 'Big Australia' debate – the natural limits of food and water resources, the need to develop sustainable cities and so on – perhaps its greatest contribution is to shine a light on our de-facto low-skilled labour migration program.

Yes, that's right – we have been importing workers to fill some of our less glamorous jobs for many years, misleading a large number of them into believing that they were coming here to take up more prestigious careers (Our migrant shame is over, November 12, 2010).

Last November the government announced a strict new points test for skilled migration, aimed at breaking the link between Australian education and permanent migration.

From around the mid-2000s, universities and the vocational education sector had become a route to permanent migration that produced vast numbers of workers with qualifications that really weren't in demand.

As a result, the Productivity Commission notes, "the skilled independent category in the permanent program consisted almost entirely of accountants, cooks and hairdressers".

The nation needed skilled workers to directly staff the burgeoning resources sector, or to replace city-based staff leaving for the resources states. That demand for skills has only increased in the past couple of years.

The skilled migration program was further diluted by other migrant intakes. The report notes: "New Zealand citizens do not need to be skilled in order to work in Australia, and the best estimate is that they are spread across the full skill range… Students and working holiday makers are usually skilled people, but a majority are employed in lower skilled jobs. Australian citizens leaving to work overseas are generally highly skilled."

So a real mixed bag comes into the country, but generally it's our most skilled who leave.

Something must be done – and no, I'm not advocating bringing down a Merino Curtain between Australia and New Zealand, or hounding happy-go-lucky backpackers from our shores.

What's needed is a more honest debate about the mix of skilled and unskilled labour. As I have argued previously, it is a human tragedy that so many bright, willing workers from abroad have effectively been mis-sold an education as their first experience of life in Australia.

Anyone who doubts this should ask one of the thousands of taxi drivers in our major capital cities who also hold Masters degrees in accounting. They have a right to feel cheated – they are performing important, productive work, but it is not the work they spent their life savings pursing through our education system.

Andrew Rimington, senior manager, employment, education and training for the Victorian Employer Chamber of Commerce and Industry is himself working on a report looking, in part, at what mix of skilled and unskilled labour Australia will need in coming years.

He writes: "…a $17 billion industry with 125,000 international students in Australia pre-GFC has been decimated by government policy change in terms of migration and disconnecting many occupations linked to VET qualifications from the original MODL [migration occupations in demand list] used for PR assessment. However, the latest forecast by the Department of Immigration is for only 15,000 international students in 2013/2014. This will also have a dramatic impact on labour supply issues particularly in service sectors such as hospitality."

Okay, so quite a few of those cooks were needed after all.

Going forward, though, VECCI wants to see more industry consultation – not just on what kind of person is allowed to enter Australia as a skilled migrant, but how we help such migrants actually end up being productive in the careers they were looking for.

VECCI makes three recommendations:

– First, that net overseas migration must be maintained at a level of at least 180,000 a year just to replace retiring baby-boomer workers.

– Second, that the government must "review how industry has a stronger role in advising where demand is growing".

– Finally, that the government "consider some level of transition assistance to ensure that incoming skilled migrants are assisted into shortage areas and do not become under-utilised in the labour market".

As reported recently, the resource states are seeing workers paid $100,000 a year to clean out temporary accommodation huts, or 'dongas'.

Set against the average full-time weekly earnings of around $67,000 that's attractive enough to tempt a science graduate, a dental nurse or an accomplished horticulturist to move north. But when they take the unskilled work, who takes over their jobs?

The 'Big Australia' debate is really a non-debate. We need more labour, skilled and unskilled. Learning to more honestly distinguish between the two can only produce a productivity gain for the nation.

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14 Comments

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Geoff Beikoff wrote:

Part of the problem is a large percentage of tradespeople leave their trade (fitters electricians boilermakers) to work as production operators (See We’ve been kidding ourselves on skills, August 3). Why?

3 Aug 2011 8:28 AM

Allen Roberts wrote:

So true (See We’ve been kidding ourselves on skills, August 3).

My patch is SMEs in the food industry, largely in regional areas. Try getting a reliable (not even necessarily good) fitter, machinist, electrician, even fork lift driver, anywhere but the largest centres, and you will be frustrated.

The destruction of the TAFE system by gutting funding and pandering to the notion that everyone deserved a degree for us to be a clever country will cost us for several generations.

3 Aug 2011 8:28 AM

J J wrote:

The reasons trades are leaving to become plant operators is responsibility (See Geoff Bleiker, August 3, 8:28am). On many sites operators and trades are paid the same (as per agreements negotiated with unions who represent a workforce that is mostly operators).

Trades are held accountable for the quality of work, and workmanship. where as when an operator makes a mistake the response is "you should have trained me better".

Why get paid the same to take on more responsiblity?

3 Aug 2011 9:25 AM

Kye Macdonald wrote:

As the owner of a Recruitment Agency specialising in the mining and construction sectors I have long felt we have let down a large percentage of skilled migrants. This I believe is mainly caused by a disconnect between what companies want and what government think companies want. We bring these people in on a false promise because their skillsets aren't what companies want (See We’ve been kidding ourselves on skills, August 3).

This problem extends to the 457 visa system as well. I have people that companies want and that they can't find domestic equivalents of (and no it's not because they aren't paying well enough), yet the government is not awarding 457s because of their arbitrary set of rules as to what makes one of these people (See Staring into a skills abyss, July 8).

I would rather see a shake up of the HECS system though where in demand qualifications are paid for if you spend 1.5 years in that industry post graduation for each year of the degree. That way we may get a few more engineers and a few less accountants.

3 Aug 2011 9:34 AM

Graham Middleton wrote:

The business of which I am a founding partner is an accounting and financial advisory business mainly servicing the dental and veterinary professions. At present the skilled immigration rules are clearly not matching needs (See We've been kidding ourselves on skills, August 3).

One example is that despite the increase in Australian dental schools, with the five major capital city scools augmented by newer schools in Bendigo, western NSW, the Gold Coast and North Queensland, overseas trained dentists are rushing into Australia, leading inexorably to the present situation of many dentists being unable to find fulltime dental positions.

Similarly, Australia now has seven veterinary schools, an increase in recent years of three. California, with a population of 36 million, has one veterinary school which is roughly the size of one of ours. Overwhelmingly, most of the Austalian veterinary profession is solely engaged in tending to pet dogs and pet cats. Vets remain on the skilled immigrant list. We really need plumbers, welders and electricians more than additional unemployed or under employed dentists and veterinary surgeons.

As for accountants driving taxis, all I can say is that when one of our dental clients advertises a vacancy they receive vastly more applications than we experience when advertising for an accountant. However, somewhere in the vast Canberra bureaucracy which funded to many dental and veterinary schools and which perpetuates wrong immigration targets there is a serious lack of accountability.

3 Aug 2011 11:08 AM

A. Brabet wrote:

The real question is, why aren't businesses training apprentices anymore? (See We've been kidding ourselves on skills, August 3). I've been told by managers "it's because they leave if you do". Yes, there is going to be a certain amount of movement in any work force but that movement also means the talent pool is bigger and the chances of hiring a replacement are easier.

The mining industry used to train huge amounts of staff. They cut costs, stopped training and they now complain they have a skills shortage. It's not rocket science to see the cause and effect.

Ironically, they would probably pay lower wages now if they had continued with industry training. This is the sort of short-term thinking that's expensive in the long term.

3 Aug 2011 11:28 AM

JJ wrote:

The restructuring of the education and training system really needs to go back to high school (See We’ve been kidding ourselves on skills, August 3). The idea of sending 1/3 to uni, 1/3 to trades, 1/3 to the workforce needs to be thrown out.

The skill level required to be a productive employee these days has grown, and despite the stereotype not all young people are good with computers. School leavers need to aquire additional skills beyond what is a current year 10 curriculum.

The line between uni and trades has never been more blurred, particularly for industrial electricians and instrumentation fitters. These skills are in demand because many of the people who should have studied them were sent to university because "it's better" and "you're too smart for that". A lot who start in these trades drop out because the knowlege and abilities required are closer aligned to a university course.

3 Aug 2011 1:00 PM

Dylan Walters wrote:

Graham (August 3, 2011 11:08 AM), I would contend that there is work for dentists in the Northern Territory.

The problem in private dentistry is that the gap between what they charge and what the health funds pay is massive, and as a consequence people look for cheaper alternatives like Bangkok or Manilla where the dental care and skills are as good as here.

As for private vets, if people are doing it tough they will knock their animal rather than pay a vet.

The great thing about vets compared to doctors is that although they charge about the same you can see them straight away. I have often thought that vets should also be able to treat people. We are just another animal. Vets also can diagnose without being told what is wrong by the patient while here in Darwin the local hospital was unable to diagnose a burst appendix in an autistic child with tragic consequences.

3 Aug 2011 1:09 PM

Gerard Matte wrote:

A simple solution proposed here: immediately convert at least 10 universities into TAFE's (See We’ve been kidding ourselves on skills, August 3). This notwithstanding the cries from mums who want their children to be professionals.

If the selected universities are not compliant with this need, then close down their government funding. So much for Rudd's and Gillard's education revolution and NAPLAN and certain teachers being paid becasue of their extraordinary teaching ability. These things are for university-trained students that we need less and less of.

3 Aug 2011 1:25 PM

Andrew Smith wrote:

An informed registered migration agent in Melbourne contends that the present government favours university vs VET qualified occupations for immigration due to pressure from unions preserving positions and wages. However, this short-term political pandering leads to wage inflation then inevitably interest rate rises which hurts everyone (See We’ve been kidding ourselves on skills, August 3).

3 Aug 2011 3:37 PM

Tim Bullen wrote:

Nobody's asked the question that is front and centre for me. Why are skilled Aussies leaving Australia? (See We’ve been kidding ourselves on skills, August 3)

3 Aug 2011 3:43 PM

Paul Bishop wrote:

Its all very simple people, "You get what you pay for" (See We’ve been kidding ourselves on skills, August 3)

3 Aug 2011 6:34 PM

Ken Mortensen wrote:

New Skillstech colleges were on a roll under the previous government (See We’ve been kidding ourselves on skills, August 3). Under the current government, it seemed more important that every kid had a computer.

That's what disappoints me about this government; despite a wising electrorate, they continue to live in a fantasy world.

3 Aug 2011 8:53 PM

Noelene Turton wrote:

Part of the problem is the low wages for apprentices and part of the problem is the education system and the push to have children go to year 12 when many would be better going to a trade school at year 10 (See We’ve been kidding ourselves on skills, August 3). Alas at year 10 how do you get into a trade school and where are they? It is a pity the local high schools can't offer trade courses.

3 Aug 2011 10:04 PM

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