“Skill up or Sink” : Is the 408 COVID visa doomed?
The Australian government has announced a series of changes to the country’s temporary skilled migration system to prevent the nation from becoming a guest-worker economy. The income threshold for temporary skilled migrants will be raised to AUD 70,000 ($53,900), with pathways to permanent residency offered to workers. The skilled occupations list will be scrapped, and a new three-tiered system will be implemented to provide a smoother entry for highly skilled professionals.
The reforms are aimed at promoting Australia as an attractive destination for global talent and addressing critical labour shortages in the economy. However, the changes may have implications for occupations that typically have lower salaries, and employers may need to consider alternative solutions to address labour shortages in these sectors.
Speaking about the proposed changes, Home Affairs Minister Clare O’Neil said that Australia’s migration system was failing to meet the economic challenges faced by the nation, and instead, was fueling a growing underclass of low-paid and exploited workers. She added that the new income threshold increase is the first in a decade and is crucial to ensuring the skilled-worker program does not become a guest-worker program.
By the end of 2023, all temporary skilled migrants will have a pathway to permanent residency. The reforms will include a net migration strategy that considers both temporary and permanent residents, rather than just relying on permanent migration caps. The government will identify the skills needed and the regions where additional workers are required and tailor the migration program to benefit people coming to Australia.
Former senior public servant Martin Parkinson, who headed the review that will spur the changes, said that Australia now relies on 1.9 million people who are not permanent residents or citizens contributing to the national workforce. Under the overhaul, temporary migrants will be allowed to move between employers to reduce the risk of exploitation, visa categories and rules will be simplified, and housing and service provision will be more closely aligned with the migration intake. The government also plans to promote Australia more actively as a destination for prospective talent.
The Australian government’s decision to increase the income threshold for temporary skilled migrants to $70,000 may have implications for occupations that typically have lower salaries. While the new wage threshold may help to prevent exploitation of workers in low-paid jobs, it may also make it more challenging for employers to hire temporary skilled migrants for lower-skilled roles, particularly in sectors such as hospitality and agriculture.
Employers may need to consider alternative solutions to address labour shortages, such as investing in training and development programs to upskill existing employees or exploring opportunities to automate tasks that can be done more efficiently by machines. The government’s focus on promoting Australia as an attractive destination for global talent may also encourage employers to tap into a broader pool of skilled workers from overseas, which could provide new opportunities for businesses to access skills and expertise that are in short supply domestically.
However, it’s important to note that the changes to the skilled migration system are not solely focused on the income threshold. The reforms will also include a new three-tiered system that will provide a smoother entry for highly skilled professionals, which may offer new opportunities for businesses to access a wider range of skills and expertise. Ultimately, the success of the new skilled migration system will depend on how effectively it can balance the need for businesses to access critical skills with the government’s aim of preventing the exploitation of workers and promoting the long-term economic interests of the country.
As Australia’s government implements sweeping changes to its skilled migration system, some industry experts are questioning whether the return to normalcy after COVID-19 pandemic, has rendered the 408 COVID visa obsolete. The 408 visa, which was introduced last year to allow temporary visa holders to remain in Australia during the pandemic, has been a lifeline for many workers who were unable to return to their home countries due to travel restrictions. However, with the government’s focus now shifting to promoting Australia as an attractive destination for global talent, it remains to be seen how the 408 visa will fit into the new skilled migration system. Some experts suggest that the 408 visa may no longer be a viable option for many temporary visa holders, particularly those in lower-skilled roles, and that employers may need to consider alternative solutions to address labour shortages in these sectors.
As always, “the devil is in the detail”. For practical and up to date advise, you should always speak with a qualified migration agent/lawyer. If you have any questions or concerns, reach out to the Sellanes Clark team.
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