Time for re-examination of 457 visa scheme

For evidence that Donald Trump's election has substantially altered the landscape in America as well as abroad it was hard to go past Bill Shorten's vow on Tuesday that Labor would toughen up on visas for skilled foreign workers. Warming to his theme on Wednesday, Mr Shorten declared that "we think that in a beauty parade, we'd rather see an Australian tradesperson get the job than someone come in from overseas when there's an Aussie that can do the same work".

Mr Shorten had flagged restricting 457 visa use in the federal election campaign, so there was nothing novel about the announcement. But it did underline a point Labor now seems keen to make to the electorate in the wake of the US election – which is that it hasn't forgotten working class voters in the way, say, that the Democratic Party did. The implications of Mr Trump's ascendancy have not been lost on the Coalition either, with Immigration Minister Peter Dutton announcing 457 visa-holders will only be able to remain in Australia 60 days (rather than the present 90) when their employment ends.

For his troubles, Mr Shorten was labelled a hypocrite by Malcolm Turnbull for the large number of 457 visas that Labor issued when it was in power. However, in fairness to the Opposition Leader, there's growing evidence that current immigration policy settings, particularly those governing guest workers, are not serving the national interest particularly well.

While Australia has maintained a relatively high migrant intake since the post-war, the importation of large numbers of guest workers dates back only to the late 1990s. To offset the skills shortages created by the mining and construction boom, the Howard government overhauled temporary work visas to facilitate the sponsorship of skilled workers. Skills categories were created and labour market testing requirements were implemented to ensure Australian pay and conditions were not undermined.

Despite that, however, 457 visa conditions have proved highly susceptible to exploitation by employers and sponsors. That's not surprising given there are 650 occupations listed on the sponsored occupations list – most of them uncapped. This is equivalent to 55 per cent of the labour market – and sponsored applicants require only minimal English language skills. The labour market has been further skewed by the ease with which international students can stay on in Australia, with full work rights, after graduating.

While it's true that the number of 457 visas issued has declined by about 30 per cent from the peak years of 2012-13 (in line with a softer jobs market), they are still mostly issued for occupations in the food and hospitality industries. Given the strength and validity of suggestions that locals can easily perform this sort of work, a reappraisal of the 457 visa scheme would seem appropriate. In fact, the Productivity Commission concluded much the same thing in its report into Australia's migrant intake released in September, along with the important rider that government pursue "genuine community engagement" in the development of a population policy.