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Migrant skill mismatch costing the country $6 billion a year

Non-English speaking migrants are much more likely to have a post-graduate degree and also build on those skills once they arrive in Australia, taking on extra studies.

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While migrants from English-speaking countries were almost always likely to have the skills set matching their job, only three in every five from a non-English speaking nation are correctly matched.

One-third of this group have “surplus” education relative to what was demanded for their occupation.

Centre director Alan Duncan said the current skills mismatch accounted for a third of the lower-earning migrants from non-English speaking countries’ experience.

He said eliminating the mismatch for qualified migrants would deliver a $6 billion boost to the national economy every year. Dealing with the skills mismatch for native-born Australians would also deliver substantial financial benefits.

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“If we are to fully realise our economic potential, we must capitalise on the skills and talents of all Australians, including our migrant population,” he said.

“This skills mismatch also exists among the native-born population and if addressed here, could add a further $2 billion to our economy.”

Professor Duncan said the skills mismatch affected up to 715,000 migrants.

There were also many migrants who were actually working in a job completely unrelated to their field of qualification.

This again was more likely to affect migrants from a non-English speaking background.

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The research also found that lifting the proportion of migrants pushes up overall wages for native-born workers. A one percentage point increase in the share of migrant workers leads to a 2.4 percentage point lift in native-born wages.

“Growth in the immigrant share of Australia’s population has led to debates over the impacts that
migrants have had, or will have, on various aspects of life in Australia such as labour markets, education systems, wages and social cohesion,” Professor Duncan said.

“Rather than the idea that migrant workers drive down wages, our research finds the opposite,
suggesting that the skills of the migrant workforce are driving productivity gains across a number of
industries.”

The research confirmed migrants are more likely to be in work or looking for it than native-born Australians. The participation rate of migrants was up to 17 percentage points higher than people born in Australia.

The biggest employing sector for migrants is health and aged care followed by the professional, scientific and technical services industry.

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