IT visas leave Aussies struggling to find jobs

An influx of foreign IT professionals working in Australia on 457 visas is making it harder for local workers to find jobs and driving down wages overall, a new report asserts.

The report from the independent The Australian Population Research Institute (TAPRI) finds that there were 17,185 IT professionals granted permanent or 457 visas in 2015–16.

By contrast, only 5000 Australian residents are completing an undergraduate IT course each year, leaving them outnumbered in the jobs market.

The report also finds that the Australian Government has been sustaining a record-high permanent immigration intake of 205,000, contributing to a very high population growth and having a damaging impact on Sydney and Melbourne, where just over half of migrants settle.

While migration advocates argue that the impact is being offset by a high growth of highly trained migrants with skills in short supply in Australia, the report states that this is no longer the case.

“Any relationship that there was between skills recruited under the points-tested visa subclasses and shortages in the labour market has eroded. As to the qualities of the migrants selected, the selection system bar has been set so low that if any high skilled persons are visaed it is an accident,” the report states.

Programmers have been in strong demand for each of the last three financial years, outstripping other categories in terms of visas granted. ICT analysts and network specialists are also commonly receiving visas.

More than three-quarters (76%) of arriving ICT professionals come from India, due largely to the success Indian IT service companies such as Tata Consulting Services and Infosys have had in winning consulting work in Australia. Employees of these companies are often granted visas to conduct the work. India is on top both in terms of permanent migrants and 457 temporary migrants.

“Many of these staff represent the cream of the crop of the huge number of graduates from Indian universities and colleges,” the report states.

“The IT service companies can take their pick from the vast number keen to work for them. Once employed most are trained in-house in the latest hardware and software programs that the service companies offer for Australian clients.”

Despite the insistence otherwise from the the National Association of Software and Service Companies (NASSCOM), these visa holders are being paid at significantly lower rates than experienced local IT professionals and in some cases even local graduates.

“The result is that the Indian service companies have an enormous competitive advantage in tendering for IT consulting work. Their success here also means that they are in a good position to provide clients with the low cost option of moving the operations they have installed to their offshore offices,” the report adds.

“The service companies’ staff know the work. Indeed, in many cases they have been trained by the client’s Australian staff in its specifications before the Australian IT workers are retrenched.”

Pakistan, China, the Philippines and the UK round out the list of the top five originating countries of permanent migrants. But for 457 visas this order is reversed, with the UK, the Philippines, China and Pakistan taking second to fifth place respectively.

The report also makes a series of recommendations for reform, including prohibiting 457 recruitment for job positions when there is a surplus of qualified local talent. But it adds that Australia’s commitments to several free trade agreements may make it difficult to curtail the 457 program.

“Australia’s current migration policies are delivering large numbers of professionals of dubious relevance to Australia’s skill needs,” the report concludes.

“These outcomes are making it even harder for local graduates and other jobseekers to find work. Also the permanent program is a major source of the population growth Australia’s major metropolises are facing. Young Australians are being hit both ways. They have to endure tough job markets and face the prospect of being unable to afford family friendly housing in these metropolises.”

Image courtesy of Yasuyuki HIRATA under CC