Part II of Nationalist Alternative’s Migration Series –

The Hidden Side of Skilled Migration and the Working Poor

By Carla O’Hara

Nationalist Alternative explores the impact of the high volume of skilled immigration to Australia’s youth and the increasing phenomena of Australia’s working poor.

Part one of Nationalist Alternative’s Migration series attempted to debunk the skilled component of the migration program and its consequences. Part two identifies the economic shock waves caused by three years of these Government policies of accepting hundreds of thousands of skilled immigrants.

Nationalist Alternative’s Hidden Side of Skilled Immigration (Part One) article pointed out:

Skilled migration creates an employer market where Australians without skills or in the midst of developing their skills, will be over looked by already skilled (degree or trade certification holding) migrants through the business sponsored skilled migration program. What this implies is that as the job market becomes tighter, employers will look for workers who have the skills they need, rather than paying for the time required to up-skill workers. Effectively, we will say goodbye to “on the job training” and white collar mentor programs.

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The skilled migration program does not benefit Australians during an economic downturn, nor does skilled migration increase the overall job skills of the local market, or improve the standard of living. The evidence points to the contrary, between the 457 cheap labour, International students working for nothing, the backdoor residency of International students blowing out skilled migration intake numbers by 30%, and the preferential employment of younger already skilled workers leaves the average local Australian high and dry.

Australia’s general unemployment rate has (at July 2013) hit 5.7%, and is due to increase to 6.25% by the middle of 2014. These figures on the surface don’t appear to be very high when compared to European unemployment rates (Greece – 27.4%, Sweden – 9.1%, U.K – 7.7%), but in truth, Australia’s unemployment figures hide a much starker reality. Unemployment in specific age groups, particularly among 20 to 24 year olds, (those who are qualified and starting their careers), has nearly doubled since 2007. Unemployment in this age bracket is set to hit 10.4% in June 2013 and underemployment affects 25% in this age group, and 40% of the working population.

University of Canberra researcher Jenny Chesters has quite aptly described the issues facing many of today’s youth.

”Despite 15 years of continuous economic growth, the Australian economy has been unable to provide appropriate employment opportunities for a sizeable proportion of Australian youth. Many young people are trapped in a vicious cycle of lack of education, lack of work experience and employers’ reluctance to give them a chance. These figures show that current employment and training programs are not meeting their needs.”

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An increasing number of graduates are finding themselves stuck in limbo; they’re not experienced enough to get the job they studied to do but they’re too qualified to get admin roles in the companies they want to work for. One such example is Yuliana Lays, 24, who finished studying public relations in 2012 and has been struggling to find work in the industry for over 12 months. Ms Lays studied a Bachelor of Arts and a postgraduate degree in Public Relations at Curtin University.

“[Companies] are saying,’ Oh we need experience even for a junior, junior role’, but if I go apply for an admin or reception role they say ‘Oh you’re overqualified, you have two degrees, why are you applying for this job?'”

Often, job seekers are commonly told there were no vacancies or too many applicants for jobs. Recruitment firm Hays’ Quarterly Report in 2012 showed a trend emerging where graduates were too qualified to get work.

“We receive a high volume of applications from candidates at the entry level who have achieved their Masters. This creates huge competition for a limited number of roles, but also places the spotlight on the importance of gaining practical experience before you become overqualified.”

In 1967 for example, only 95,290 students were enrolled at university, last year, the population had nearly doubled and enrolments totaled 1,094,672 as universities churned out graduates for jobs that didn’t exist. Graduate students in the 20-24 year old bracket are now left with the prospect of huge education expenses and HECS debts, together with the prospect of not finding work. But it isn’t just the ‘over-educated’ graduates who are struggling to find work. Even those who leave school to obtain an entry level position are struggling to find a job.

Unemployment

Backpackers and other young people from economically ruined countries are taking jobs using guest working visas from young Australians who previously occupied the lower end of the job market. Mission Australia chief executive Toby Hall warned youth unemployment on the fringes of Australia’s capital cities had grown to Spanish crisis levels.

“There is clearly a crisis here and it needs to get dealt with. The young people who are unemployed today will still be unemployed in 10 years’ time and their children will be unemployed too. It’s reaching Spanish style unemployment numbers [26%] in parts of Australia.”

Professor Michael Quinlan, from the University of NSW’s Australian school of business, also believes that the government policy is creating a pool of permanently unemployed.

”There’s a complete mismatch in Australia’s labor market, there must be thousands of people working here from overseas.”

Professor Quinlan goes one step further in assessing the outcome when both uneducated and educated youth continually fail to secure employment; Australia has the potential to create marginalized and disengaged youth.

“Other countries have learnt to their cost what happens when you create a market that cannot absorb the young men who are the sons of the first generation of immigrants who come seeking a better life.”

He is of course inferring reference to the Muslim riots in France in 2005, riots in Britain in 2011 and the riots in Sweden in 2013.

According to the Department of Education, Employment and Workplace Relations, more than 50,000 young people were unsuccessful in attempts to find work in May this year, which is up by 15,000 from a year earlier. Over the same 12-month period, the combined total of Newstart Allowance and Youth Allowance recipients increased by 20 per cent, while the number of people unemployed for more than 12 months and looking for work increased by 27 per cent.

Australian Chamber of Commerce and Industry director of employment and education Jenny Lambert warned youth unemployment would only get worse. She criticized the federal government’s decision to axe $242m in subsidies for trainees and apprentices. The government will no longer pay employers $3000 for full-time apprentices and $1500 for part-timers once they complete their training, unless they work in a “priority occupation” of skills shortage, such as the trades, aged care, childcare or nursing.

In essence, Australia is creating a powder-keg situation. Unemployed youth are unable to secure work without an education, and skilled migrants continue to compete for a limited number of available jobs. Coupled with this there is a lack of government incentives for employers to take on workplace training and apprenticeships.

Is isn’t just Australia’s youth that are struggling to find work either. Australia is in the grip of an underemployment epidemic, as a growing number of people are joining the ranks of the working poor with jobs that are low paid, unskilled, insecure and offer few career prospects, according to Professor Chris Warhurst at the University of Sydney Business School.

“It’s becoming very difficult now for workers at the bottom of the ladder to aspire to better paid and more satisfying middle ranking jobs … or to do an apprenticeship, become qualified tradespeople and move into jobs that were once highly desirable.”

New research reveals that 784,000 people are struggling to find more hours to earn more pay. Of those underemployed, 730,900 held part-time jobs in September 2012, and 53,000 were full-timers who were doing less than 35-hours a week because there was not enough work. About 345,000 people were actively seeking more work, and had asked their company for more hours, searched job sites or contacted new employers in the past month.

Brian Howe, a former deputy prime minister of Australia believes there is a new divide in the Australian workforce. It is no longer between blue-collar and white-collar workers, but between those in the “core” of the workforce and those on the “periphery”, with 40% of Australian workers in insecure work.

“Those in the core are likely to be in full-time employment, either permanently within organisations, in management positions, or possessing skills for which there is steady demand and for which they can charge a premium. They are likely to have sick leave, paid holidays and in many cases parental leave above the government’s minimum standard.

For them, flexibility means the chance to work in a variety of industries, to work overseas, to earn good money freelancing or in a secure part-time arrangement. Periods of unemployment are likely to be short or voluntary.

Those on the periphery are employed on various insecure arrangements – casual, contract or through labour hire companies, on low wages and with no benefits. Many do not know what hours they will work from week to week, and often juggle multiple jobs to attempt to earn what they need. Their skills are low, or outdated, and they are not offered training through work. They shift between periods of unemployment and underemployment that destroy their ability to save money. Their work is not a “career”; it is a series of unrelated temporary positions that they need to pay rent, bills and food.”

Underemployment by its nature puts more pressure on women who inevitably are competing with men, who would under normal circumstances be seeking full time work. While women will seek part time work in order to balance work and family responsibilities, men will not have these same restrictions. Women with children are therefore more likely to be discriminated against for having to leave work earlier to do the childcare pick up, deal with sick children and therefore taking arbitrary days off work.

Considering that the average full time wage is $72,800 per year, (however, the average gives a misleading impression about what the typical worker earns. It is pushed upwards by the large salaries of a small number of very high income earners. The median gives a more accurate sense of the typical worker’s wages), and the median salary was $57 400 in August 2011. For a woman to work and pay childcare ($90 per child, per day) for 2 children without the Government 50% rebate, she needs to earn a minimum salary of $61,000. A woman with 3 children in childcare without the 50% rebate needs to earn a full time salary of over $90,000. These figures only take into account the cost of childcare and the marginal tax rate and do not include general living expenses.

Compare the average and median full time wage with the working mother salaries presented above and it is unsurprising that the costs of childcare leave many women unable to work as it isn’t financially viable. It is also unsurprising why many families will stop at two children as the costs of being out of work coupled with the costs of an additional child in childcare are financially prohibitive for families requiring a dual income.

For the average Aussie family, supporting the average two children on an income of between $57,400 – $72,800 means these Australians are the working poor; they live close to the poverty line despite having at least some form of work. In fact, Australia has already developed a subclass of working poor. Academics at the University of Newcastle have determined that 30% of part-time workers are actually in poverty with those in retail and hospitality the most affected.

ACTU president Ged Kearney said the statistics showed how hard it was to break out of the cycle of insecure work.

“There are almost half a million Australians who are unable to earn what they need to survive or advance because they can’t get enough.”

To further exacerbate job seeker frustrations, jobs are being advertised where no position exists. The undercover recruiter provides the following explanation:

A frustrating reality of dealing with large online job boards is that many companies purchase contracts with these job boards that include a specified number of job postings. When the contract nears its end, the company is faced with the fact that if they don’t use their remaining job postings, they lose them. So they choose to post job openings that don’t exist to use up their remaining postings.

Yet, Australian’s are still awaiting the Labor Government to announce withdrawing or reevaluating the skilled immigration program; whilst the Liberal party has assured voters if it wins the election it will continue the high volume of skilled migrants. Meanwhile, Australia’s youth struggle to find work. In short, the jobs crisis is set to worsen rather than improve.

References:

http://www.news.com.au/business/worklife/over-qualified-graduates-struggle-to-find-work/story-e6frfm9r-1226496938767

http://www.smh.com.au/national/gen-y-cant-i-find-a-job-20130712-2pvln.html

http://www.news.com.au/business/worklife/gen-y-in-grip-of-unemployment-crisis-as-jobless-rate-soars-centrelink-data-reveals/story-e6frfm9r-1226693093577

http://www.theaustralian.com.au/national-affairs/industrial-relations/youth-jobs-crisis-looms-as-welfare-payments-blow-out/story-fn59noo3-1226673974904

http://www.news.com.au/business/worklife/over-qualified-graduates-struggle-to-find-work/story-e6frfm9r-1226496938767

http://theundercoverrecruiter.com/why-do-imaginary-job-openings-exist/

http://www.news.com.au/business/worklife/underemployment-australias-working-poor/story-e6frfm9r-1226583071457#ixzz2dEDE7BIk

http://www.abc.net.au/news/2013-02-21/abs-figures-show-predicament-of-working-poor/4532964

http://www.abc.net.au/pm/content/2012/s3598525.htm

http://www.canberratimes.com.au/act-news/city-living-grows-tougher-for-capitals-working-poor-20130518-2ju1x.html

http://www.smh.com.au/federal-politics/society-and-culture/we-are-witnessing-the-emergence-of-a-new-working-poor-20120419-1x9z2.html#ixzz2dEkotPbE

http://sydney.edu.au/news/84.html?newsstoryid=10135

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