Study: Migration boosts Australian economy, eases skills shortage

22 August 2008


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According to a press release by Australian Immigration Minister Chris Evans, a recent report by Access Economics shows that new immigrants in Australia contribute hundreds of millions of Australian dollars to the nation's budget and economy every year.

Evans stated in a speech before the Australian Mines and Metals Association that the overall fiscal benefit of immigration is "substantially positive" and it continues to grow over time.

The economic analyst's report entitled Migrant Fiscal Impact Model: 2008 Update looked at the costs that immigrants impose on health, education, welfare, employment services, and settlement services, compared to the fiscal benefits from taxation and visa charges.

For the 2006-07 fiscal immigration year, Access Economics estimated that that years immigrants would contribrute a total benefit of AUD $536 million in the first year, then another AUD $856 million in the second year. This would grow steadily over time and reach AUD $1.5 billion by year 20.

"Applying the same modelling to the 2007-08 migration program, the net fiscal benefit is $610 million in year one, $965 million in year two then growing to $1.5 billion by year 20," Evans noted.

"The forecast for the 2008-09 migration program is for an $829 million benefit in the first year, $1.16 billion in the second year, then $1.8 billion by year 20," he added.

Evans said the Access Economics report dispelled the myth that immigrants impose a huge cost on the taxpayer.

"The positive fiscal impact is particularly pronounced for skilled migrants, which reflects their high rate of labour market participation and higher incomes which in turn leads to a high level of direct tax receipts," Evans said.

Australia's General Skilled Migration program allows individuals to immigrate to Australia if they possess skills and past experience in a large list of occupations.

Evans also said that skilled migrants help Australian employers fill "critical labor gaps" at a time when many employers are struggling to fill positions.

"The bottom line is that our migration program is vital to keep the economy growing as well as helping Australian businesses overcome skills and labor shortages," he added. "Australia is facing a demographic shift that will see more people retire than join the workforce so the permanent skilled migration program provides a stable, effective and targeted source of skilled workers."