Joint committee wants whole-of-government approach to tackle Australia’s skill shortages

Taking a whole-of-government approach to address Australia’s skill shortages and replacing the Australian and New Zealand Standard Classification of Occupations (ANZCO) list are among some of the key recommendations the Joint Standing Committee on Migration has put forward as part of its final report for its inquiry into Australia’s skilled migration program.

The release of the full report comes just six months after Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs Alex Hawke first requested for inquiry.

“The committee is reporting in a timely manner given the significant issues related to the COVID-19 pandemic and the resultant effects on the skilled migration program,” the committee outlined in the full report [PDF].

Committee chair Julian Leeser went on to add that since the pandemic began in March 2020, over 500,000 temporary migrants have left Australia and a further 77,000 people are expected to leave Australia in the 2021-22 financial year.

“The lack of skilled migrants and near record low unemployment has resulted in major skill shortages in the Australian economy impacting the viability of businesses,” he said.

“However, the pause in the skilled migration program has provided an opportunity to have a less constrained examination of the skilled migration program than might ordinarily be possible.

“In particular, to consider whether the skilled migration settings are serving Australia’s interests and its traditions of being selective about who we take in, while remaining internationally competitive to ensure Australia remains an attractive place for skilled migrants.”

The committee detailed how it was “not convinced” a whole-of-government policy approach was being taken to address the skill shortages.

“In order to effectively address the many labour shortages … the committee sees a need for a comprehensive approach to identifying and planning for current and future workforce needs and their location,” it said.

“Understanding where skills gaps currently exist, what skills are under development and likely to become available domestically in the future, and what industries are subject to current, emerging and future workforce shortages is key to understanding the occupations requiring skilled migrants now and into the future.

“Such an assessment will require two key responses. One is a coordinated approach across the Commonwealth and across jurisdictions. The other is a more coordinated approach to data gathering and analysis.

“Aggregating the collected data, to be analysed by a cross-agency and cross-jurisdictional body to produce a coordinated national workforce plan will not only assist in ensuring that any labour shortages are both understood and addressed as effectively as possible, it will also provide a more solid foundation for planning migration numbers and the specific types of visas and occupations that are targeted by the migration intake. A more coordinated approach will also further bolster public confidence in the skilled migration program.”

The committee further added that it agreed with many submitters and witnesses that ANZCO was “severely outdated”, and therefore it saw value in “shifting to a new approach to underpin the skilled migration lists”.

The ANZCO list was established by the Australian Bureau of Statistics (ABS) to provide information on the skill level of jobs, qualifications, and experiences needed to work in specific occupations in Australia. The list is used by the federal government as a base as to whether an individual is eligible to qualify for a skilled visa in Australia, including the Temporary Skills Shortage (TSS) visa, which was introduced in April 2017 after the Temporary Work (Skilled) 457 visa was scrapped.

“ANZSCO was not designed to underpin the various skilled migration lists, and its shortcomings have been amply revealed by the long period in which ABS has not undertaken a comprehensive update,” the report said.

As part of its recommendation, the committee wants to see the National Skills Commission develop an new occupation and/or skills identification system for the skilled migration program in consultation with industry to replace ANZCO.

“The new system should be more flexible to adapt to emerging labour market needs, with consideration given to how the new system would integrate with other functions of government currently utilising the ANZSCO,” the committee said.

At the same time, the committee has recommended that government provide clearer pathways to permanency to enable international students and temporary migrants to stay and help fill Australia’s skill shortages. However, conditions such as requiring to applicants to have competent English language ability and be under the age of 45 should remain in place, the committee said.

It also believes there are opportunities to consolidate the Medium and Long Terms Strategic Skills List (MLTSSL) and Short Term Skilled Occupation List (STSOL) into one list — The Skilled Occupation List (SOL) — and ensure that it is regularly reviewed.

Other recommendations include businesses being exempted from Labour Market Testing when a 457 or 482 visa holder has been employed in the position on a full-time basis for 12 months or more, and prior to their lodgement of a subsequent visa application or a permanent residence application.

The Department of Home Affairs has also been asked by the committee to improve its customer service, including establishing industry liaison officers who can provide feedback to the department on emerging industry conditions.

Earlier this year, Home Affairs revealed while fronting the committee that individuals from the tech sector made up the biggest cohort of those who were granted visas through the Global Talent Independent (GTI) visa program from July 1 to December 31 last year.

During that six-month period, there were 11,013 visas granted to those who worked in the quantum information, advanced digital data, data science, and IT fields.

Those in the medtech industry made up the next largest cohort, followed by energy and mining technology, agtech, space and advanced manufacturing, fintech, and cybersecurity.

The GTI visa program was first launched in November 2019 to attract global tech talent to Australia. Individuals who apply through this program are assessed based on their individual background, including their earning potential in the field.

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