Migrant skills a waste of talent

Australia should offer migrants better English-language training and recognise international qualifications if it wants to boost productivity and tackle critical skills shortages, a new report has recommended.

As debate over the size of the country’s migration program rages, and economists fear a decline in productivity could further erode living standards, the Committee for Economic Development of Australia found Australia was not making the most of skilled migrants to plug gaps in key industries.

Warning that there are “big costs” from not making the most of migrants’ skills, the report found people who’d moved to Australia between two and six years ago were earning 10 per cent less than their Australia-born counterparts, equating to more than $4bn in forgone wages a year.

The biggest losers were female migrants with a postgraduate degree, who earned on average 31 per cent less than Australia-born women in the workforce with similar education levels.

CEDA senior economist Andrew Barker said more work needed to be done to close that wage gap, and that weak English skills and a lacklustre approach to recognising migrants’ skills, paired with discrimination, was having an impact on the entire workforce.

“Many (migrants) still work in jobs beneath their skill level, despite often having been selected precisely for the experience and knowledge they bring,” he said.

“Ensuring migrants can use their skills within their first few years in Australia is crucial to addressing ongoing skill shortages across the economy.”

He said the government should expand funding for existing English programs.

Currently, the government funds the adult migrant English program, which is designed primarily for family and humanitarian migrants.

The report found only about 15 per cent of skilled migrants use the program to fill gaps in their English ability.

“The government should consider additional funding for this program,” the report said.