The federal government is looking at the possibility of requiring immigrants to live in certain rural and regional areas as a way to address concerns raised by politicians about the impact of immigration on infrastructure and public services. Alan Tudge, minister for multicultural and citizenship affairs, was quote saying. We are looking into ways to effectively tie people to these regions, if they have a sponsorship.
These policies are design to help rural and regional economies. Recent research by John Madden and Louise Roos has shown that the policy of granting temporary visas to migrants (457 visas) to the country is not effective in boosting long-term regional economies.
Employers were able to bring in skill workers from abroad for up to four year under the 457 visa program, which replace in April 2017 by a more restrictive but similar temporary skill shortage visa. Employers from any country can apply. However, it is possible to use the program to send migrants to non-urban areas. Visa holders legally bound to their employers and their location.
Impact Of Regionally
Two scenarios were create as part of our research. The first looked at the impact of regionally targeted 457 visas. This done by assigning visa holders to non-metropolitan areas. The second model simulated what would happen if visa holders moved across regions based on their current settlement patterns.
We considered the labour market and visa details for workers in each capital and the rest of each territory or state (except the ACT which we treated as one territory). Also considered the possibility that workers might want to move to other regions or occupations due to wage movements.
We found that national employment and real GDP increased by almost identical amounts. Likewise, national wages decreased under programs where immigrants were target to rural or regional areas.
We found that targeted visa programs increase regional activity at the regional level in the short-term. However, this is not sustainable over the long term. Economic variables like regional real GDP and employment begin to look the same after five to ten years.
Displacement Of Workers Immigrants
This is mainly due to the displacement of workers in the region. The targeted migration program increases the number of workers in the region. The result is that wages in the area are lower than those in other regions. This discourages workers coming from other regions to work in the region and encourages them to stay. We also looked at what would happen if permanent skilled migration programs were target at rural and regional areas.
There are many permanent regional skill migration programs available, including the Regional Sponsored Migratory Scheme, the skill nominated Visa, and the skilled regional Visa. These visa holders are allow to remain in the country for as long as they wish, but must stay in their designated region for at most two years. This is different from temporary visa holders who have to leave Australia once they are grant a permanent visa.
We found similar results for targeted permanent visas when we investigated them. We find that the short-term employment and regional GDP gains resulting from regionally targeted migration programs under temporary or permanent visa arrangements gradually resemble those of untargeted programs.
New immigrants often move to other areas, mostly to capital cities or to countries overseas over time. Even if effective and implementable policies were developed to bring new immigrants to the region, the displacement effect that we have described would still be detrimental to the long-term economic and population health of the region.