Labor Market Issues in Australia - Essay Example

? and Section # of Synopsis In this essay basically there is an analysis of how the Australian government is facing the entire 457 visa issue which has been implied to attract overseas workers who are skilled for those relative jobs for which Australian workers are not available. The misuse and certain aspects of the policy resulted in criticism. And therefore, the policies were reformed and are still under consideration. Next, I have discussed the issue relating to carbon tax. It has been discussed and evaluated about how the Australian government thinks that only hefty taxes can reduce the amount of pollution emitted in the air versus the party that assumes that the large businesses are the drivers of the growing economy and imposing heavy taxes will shut down the businesses. AUSTRALIAN LABOUR MARKET Introduction There are several ways through which a person gains human capital. However, the two main ways are education and the second is experience or on the job training. Various skills are required to perform different jobs and the basics skills are acquired through studies or formal education. However, without experience or practice the education is not as effective. Therefore, even at work, the worker is always in the process of learning. Considering the level of skills in the labour force in Australia, the government has been consistently undertaking various projects to support the workers in various areas and trying to expand and equip the workforce. Australian Labour Market There are a number of programs and workshops to assist organizations and also to train workers such as Workplace English Language and Literacy (WELL). They train workers in English language and numeracy skills linked to various jobs. Similarly, WORKERS’ EDUCATIONAL ASSOCIATION, SYDNEY (WEA Sydney) has been operating for the past century assisting organizations and providing wide range of public lectures and lectures in various subjects although it has not been funded by the government a lot. Also training has expanded to fields relating to communication technology and digital communication. (IMMI, 2010) The relaxed immigration policy of Australia is the evidence that the Australian government is attracting immigrants from abroad to work in Australia as the country is deprived of fully skilled workers for respective jobs. The Australian Human Resource Institute (AHRI) on skill shortages conducted a research. According to the report it was found that seven out of ten Australian employers surveyed are still experiencing a skills shortage, and more than 85% believe skilled migration is necessary to the success of their organizations. Therefore, research results from the Department of Education, Employment and Workplace Relations are working to find out the area where the skills are lacking at state and national level as the ability to work matters on various factors such as season, geographical base and also knowledge. That is there might be a worker with a certain skill; however he or she might not be able to find the respective job in his or her locality and would be unemployed for sometime as he/ she would also not be aware of the job in some other locality. Therefore, there has been a shortage of workers in Australia. (IMMI, 2010) The Australian government therefore introduced a visa policy known as 457 visas in 1996 under which immigrants were given working opportunities in Australia. They allowed skilled people to temporarily work in Australia under an approved sponsor for up to four years. During times of economic progress the use of this policy was very effective as skillful employees invited from abroad could easily fill the demand gap. However, over the years it has undergone many changes since hiring employees from foreign countries reduces the opportunities for the local workforce. During times of the global economic recession like during 2009 the demand for the 457 visa workers fell and the usage of the policy reduced, but so did the demand for the local workers. (IMMI, 2010) However during 2010 and 2011, when the economy started to recover, the number of primary visas granted increased 38.2 per cent. Therefore, the program responded quickly to the employers’ demands. In reaction to this, the issue arises that whether companies in Australia should be allowed to hire overseas workers to fulfill their business criteria or rely on local workers. And the policy has been altered and will be further altered this year to protect Australian workers. (IMMI, 2010) Some company officials argued that it is very important to hire overseas workers as they are running huge business and competing in the global market. Therefore, it is there requirement to hire the same resources that are available to their competitors. The government cannot abandon the policy right away, as the overseas workers are a must to fulfill short-term gaps of the large business. In many cases these gaps are genuine as skillful workers are not available such as health specialists, IT technicians and mine workers. There was a need for technicians due to the expansion in the mining industry, thus technician occupations rose by 65.4 per cent from 2010 to 2011. The increase in the number of visas granted for workers in the construction industry was 74.7 per cent. The program responds to temporary labour needs of those industries that face shortage. There is always a strong demand for health professionals, and the highest number of 457 visas granted in the last year was for people working in health care and social assistance. (IMMI, 2010) On the other hand, the opposition feels threatened by the visa policy as they feel that this policy is not favorable for the economy and does not protect the rights of the Australian labour force. The policy was reformed in 2009 in order to ensure that the policy was implied in such a manner that the objective is achieved, which was to fill short-term skill gaps of the businesses. However, yet certain employer practices were not keeping align with the criteria of the subclass 457 program. Hence, on 23rd February 2013 the policy was announced to be further reformed which would be in affect from the 1st of July 2013. The certain measures that are intended to be taken under the 457 visa program include that it will be assured that the nominated position to be a genuine vacancy keeping in consideration whether there is an accordingly skilled Australian that is fit for that job. The department would take action against sponsors who would engage in any sort of discrimination during recruitment. The requirements of speaking English would be strict now as exemptions for applicants from non-English speaking backgrounds were earlier considered. One of the main reforms is that the sponsors must train Australians by introducing a compulsory requirement to the employee of their approved sponsorship. This is very important for the economy as the Australian workers can be skilled and eventually be able to take the jobs. The 457 visa workers cannot be engaged in any unintended employment and only be engaged on an employment contract. This will reduce the number of jobs a single overseas worker will be able to take and will therefore create employment for Australian workers. Therefore, the measure taken if applied effectively will be able to benefit the Australian economy as the overseas employees will provide training to the Australians and make them capable to take those jobs. (IMMI, 2009) Various articles discuss the idea of the immigration policy such as in the article, ‘Employment Niches for Recent Refugees: Segmented Labour Market in Twenty-first Century Australia’ it is mentioned, “Changes in the immigration regulations have been introduced to encourage new arrivals to settle in regional areas and to enable regional employers who face labour shortages to nominate and ‘sponsor’ immigrants (DIMIA 2005a). These policy developments specifically target refugees: a recent (2003) government initiative encourages refugees, especially those from ‘emerging’ African and Middle Eastern communities, to settle in country areas (DIMIA 2005d).” The article clearly expresses how the gap is being filled for unattractive jobs such as construction workers. According to another article ‘Impacts of a High-skilled Immigration Policy and Immigrant Occupational Attainment on Domestic Wages’, we do not find evidence of an adverse impact of highly educated immigrants on the wages or earnings of highly educated native-born workers. However, we do find a small negative effect of an increase in the relative supply of immigrants with higher educational degrees for native-born workers without high-school degrees. We estimate a 1.4 to 1.9 percentage decrease in the weekly earnings of the NZ-born workers with no qualifications, for a 10 percentage point increase in the relative share of workers with a Bachelor’s degree or higher.” This clearly indicates why the Australian workers feel threatened. Also there has been a heated debate relating to the imposition of the carbon tax and the mine tax. However the issue relating to the carbon tax has been raised more as various businesses are in operation and with the high amount of carbon taxes, their tax costs will shoot high keeping aside the other expenses they have to pay. This is of relative importance, as it has to be considered. If businesses will incur such high costs, it will make them less profitable and they might want to go out of the business and reduce the prospective investment. However, on the other hand the opposition party is in favour of high carbon taxes in order to control the climatic change. To support this, I will refer to an article, ‘The Impact of a Carbon Tax on the Australian Economy: Results from a CGE Model*’ by Mahinda Siriwardana and Sam Meng. Looking at the economic effect, the government has been able to conclude that there shall be taxes imposed on the amount of carbon emission by a business effective from 1st July 2013. There shall be no tradable pollution smoking permits aswhether those firms that are emitting more carbon purchase pollution permits from those firms that are emitting less carbon or pay higher taxes, both policies will affect the cost of energy. The tax will have an impact on the economy. It will affect Australia’s GDP, industrial structure and trade. Conclusion The Australian labour market has always faced an acute shortage of the skilled workers. This shortage has been filled by overseas workers who have supported by relaxed immigration policies as well as other training programs. However, the recent steps taken by the Australian government, in respect of the modification of the visa policy and training programs, it is strongly believed that these steps will lead to an improved local labour market that will fill the skill gap in the future. This, in turn, will strengthen the Australian economy. BIBLIOGRAPHY Designs, E. (2012) Migration and Australia's skill shortages. [online] Available at: http://www.workingin-australia.com/visa/skill-shortages/migration#.UZJ7GaspZhN [Accessed: 15 May 2013]. IMMI (2009) Strengthening the integrity of the 457 program. [online] Available at: http://www.immi.gov.au/skilled/strengthening-integrity-457-program.htm [Accessed: 15 May 2013]. IMMI (2010) The 457 Visa Program. [online] Available at: http://migrationblog.immi.gov.au/2011/09/26/the-457-visa-program-201011-year-in-review/ [Accessed: 15 May 2013]. Read More