Fixing the 457 visa for temporary foreign workers
Published Friday, 8th September, 2006
by Bob Kinnaird
The subclass 457 visa is Australia's main temporary work visa for so-called skilled workers. The visa has become a highly contentious political issue. The Federal Labor Opposition and the ACTU vehemently oppose this visa in its current form, arguing that it threatens jobs and training opportunities for Australians, undermines wages and working conditions and exploits foreign (non-resident) workers. Both portray 457 visas as part of the government's broader industrial relations strategy.
Growth in 457 visas has been so rapid that in 2006-07, for the first time in Australia's history, there will probably be more temporary skilled 457 visas granted than skilled permanent residence visas. This is a deliberate Federal government strategy. It has frozen the permanent skilled migrant intake at 2004-05 levels, and opted to aggressively promote employer-sponsored temporary visas as the best way to meet Australia's skilled labour needs.
The projected number of 457 visas granted in 2005-06 is around 40,000 primary applicants and 71,000 including accompanying family members. This is a massive increase of 43 per cent over 2004-05, with even more likely in 2006-07.
457 visa impacts on jobs and training opportunities in ICT
The 457 visa program (along with other factors) has contributed to greatly reduced demand for IT graduates since 2001 and poor graduate job outcomes leading to plummeting enrolments by young Australians in IT courses.
Since 2001 the proportion of Australian computer science graduates unable to find full-time work has been at record or near-record levels (25-30 per cent) and enrolments by Australian students in university IT courses have fallen by probably 50 per cent, to less than 9,000. There are now fewer Australians commencing IT courses than in 1996 when the Howard government first came to office.
On June 30 2004, there were an estimated 5,000 foreign nationals on 457 visas working in ICT in Australia, including 2,200 people under age 30 working as computing professionals. At the same time, some 2,000 computer science graduates and postgraduates were unable to find full-time work. On the available evidence, some of these ICT workers on 457 visas have become substitutes for Australian IT graduates.
457 salaries and market rates
If 457 wages and salaries are undercutting market rates, these visas are not only putting downward pressure on Australian wages but are effectively a government subsidy to some employers, giving them an unfair competitive advantage.
It is not possible to determine if actual salaries paid to 457 visa-holders are undercutting market rates. This is because the Department of Immigration and Multicultural Affairs (DIMA) does not even collect information on actual base salaries paid by employers to 457 visa-holders through its compliance monitoring system or any other regular means.
The DIMA 457 compliance monitoring system only asks employers whether 457 visa-holders are being paid the original base salary determined when visa nominations were first approved.
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