As a leading professional services firm, KPMG Australia (KPMG) is committed to meeting the requirements of all our stakeholders – not only the organisations we audit and advise but also employees, governments, regulators and the wider community. We strive to contribute to the debate that is shaping the Australian economy and welcome the opportunity to provide a submission in response to the Department of Home Affairs Discussion Paper: A Migration System for Australia’s Future (the discussion paper).
Australia’s skills-focused migration program boosts labour force participation and real per capita incomes. Economic analysis consistently shows that the skilled labour migration intake is budget-positive and does not depress local employment or wages in the long run. KPMG’s own economic analysis finds that in a scenario where the number of overseas migrants is increased by 265,000 over the next five years, real GDP is projected to be almost $30 billion higher than in a baseline projection. Assuming that the new skilled migrants are 20 percent more productive than the incumbent workforce on average, there is an additional projected $5 billion lift to GDP in 2030.
Australia must regain its place as one of the most attractive skilled workforce destinations in the world if our economy is to remain competitive and achieve real productivity and wages growth. The permanent and employer-sponsored skilled visa systems pose ongoing challenges for migrants and employers due to immigration policy changes before COVID-19, the drop in temporary migration due to border closures, short-term visas with no or protracted pathways to permanency, an outdated and restrictive occupation list, poor market testing and burdensome administration. A further factor impacting the ability of Australia’s migration program to support business is the changing nature of the workforce; in particular the evolution of hybrid work arrangements.
More than two years of pandemic disruption to the skilled workforce and workplaces has highlighted a significant labour shortage Australia wide, which a migration system review and a thoughtfully designed migration program can help to address. Reform of Australia’s skilled migration program should be cognisant of the lessons learned during COVID-19 lockdowns.
This submission outlines tangible steps that can be taken towards a migration system review that is aligned to Australia’s future workforce needs, and we look forward to working with the government on these important issues.
