Committee for Economic Development of Australia senior economist Andrew Barker said a failure to formally recognise migrants’ skills and foreign qualifications, English-language ability challenges and, in some cases, discrimination, are key reasons Australia is not making the most of skilled migrants.
As a result, migrants who have been in Australia for two to six years earn more than 10 per cent less than otherwise similar Australian-born workers, and it takes 15 years to catch up, CEDA research shows.
“Clearly there are important safety aspects, but foreign qualification recognition among occupational regulators is relatively low and is really important,” Mr Barker said.
“We are failing to match skills to jobs, and engineers driving Ubers is the classic example.”
Engineers Australia estimates there are 100,000 qualified, skilled engineers in this country driving Ubers or doing other work that is not related to engineering.
Only 50 per cent of qualified engineers born overseas who are working in Australia are working as engineers, a situation Engineers Australia chief executive Romilly Madew has said is an “emerging national disaster”.
Mr Tan’s research on state-sponsored skilled visa holders found about 43 per cent of skilled migrants were not employed in their nominated occupation, under the state-government-sponsored visa scheme in South Australia.
Nationally, there were about 30,400 state-sponsored visas allocated in 2023-24 and 36,825 employer-sponsored visas. The vast majority of skilled migrants working in retail, hospitality and service manager roles were overqualified for their jobs.
‘Professional gatekeepers’
Mr Tan’s co-researcher, Andreas Cebulla from Flinders University, said the results were similar in all states and territories and across occupations and industries.
Former Productivity Commission chairman Peter Harris said in a speech last month that regulations on qualifications were stopping migrants working in jobs best suited to their skills.
He said while professions such as medicine and law used qualifications as barriers to entry for newly arrived migrants, the same was also true of basic trades, which required migrants to return to vocational education.
“We desperately have to get this right,” Mr Harris said at the University of Queensland.
“We take a skilled person out of an often under-resourced foreign environment where that skill was in use and our gatekeepers in the professions and trades effectively de-skill them, which they accept in order that they can live in our wealthy society.”
Mr Harris said the barriers were reducing competition for skilled jobs in the labour market, ultimately leading to higher prices for consumers.
CEDA has recommended the federal government improve recognition of international qualifications and work experience by direct assessment of competence, rather than a requirement to hold qualifications under a specific system.
Occupational regulators should be forced to justify their decisions where they decide not to recognise a migrant’s international qualifications, and to identify skill top-ups and bridging courses to close the gap, CEDA says.
Assimilating workers into skilled jobs from non-English-speaking backgrounds has become more challenging in recent years, as more skilled workers come from China, India and the Philippines and relatively fewer from the UK and New Zealand.
Only about 15 per cent of skilled migrants receive help for English language skills through government support.