For wealthy countries like Australia, the economic changes of the past several decades have shifted the basis of their comparative advantage away from previous models of industrial and manufacturing output towards the so-called “knowledge industries” of the service sectors. These shifts in economic models have created a new competition between states in their ability to attract the most talented individuals from around the world.
States that are unable to attract the best and the brightest to their shores risk falling behind in the competition to be innovative and create the new products and services economies require. Alongside this they also risk negatively affecting the standards of living their populations have become used to, as whole industries become redundant and no new industries develop to replace them.
The recent emergence of parochial populism in the West has undermined this new necessity. As the anxiety created from rapid economic change has caused people to retreat into more insular and suspicious mindsets, immigration has become to be seen as the problem, not the solution, to people’s employment opportunities and social stability.
Yet this nativist sentiment within other Western countries could have been to Australia’s advantage. As other states have created a culture of distrust around immigration, Australia could have put out the welcome mat and attracted a range of skilled individuals who may have otherwise gone to the more attractive economies of United States or Western Europe.
Instead the Australian government has decided to follow the nationalist trend with a series of measures that will make it more difficult to both attract and secure foreign talent, and will subsequently adversely affect the continued evolution of Australia’s economic model.
The first measure was the abolition of the 457 skilled worker visa (the equivalent of the H1B visa in the United States). This visa had allowed Australian employers to sponsor foreign talent for up to four years. The visa is being replaced by two new visas, one for two years, and another for four years. Both visas place greater restrictions on the range of positions companies can hire foreign workers for.
Following this has been a change in the criteria for people being able to apply for citizenship. Previously, people who have lived in Australia for four years, and spent at least one of those years classed as a permanent resident were able to apply for citizenship. Those wishing to become citizens will now be required to have four years as a permanent resident before being able to apply for citizenship. This change offers no incentive for people to become invested in the country, leaving transient group of highly skilled people who can easily be tempted away from the country with a better offer.
Alongside this change to citizenship criteria the government has also decided to create a new “values test” for people applying for citizenship, and a new English language test. The former is clearly aimed at those from Islamic backgrounds (or more accurately aimed at sating voters suspicious of Muslims), and the language test an extra hurdle for those who have come to Australia via the refugee or family reunion programs. This could subsequently create a class of people who will never be citizens, and ignores the great contribution the English-free southern Europeans who came to the country after World War II have made.
These counterproductive changes are not surprising. The governing conservative Coalition is polling poorly and experiencing a significant fracturing of their voter base towards smaller parties. Philosophically unmoored, the coalition’s senior partner, the Liberal Party, required some grand new narrative to emotionally sway the public back towards them. The prevailing global nativist sentiment was irresistible.
While these might temporarily placate an anxious domestic audience, they will no doubt harm Australia’s economic performance and its strategic interests. The changes to visa system and revised citizenship criteria have been widely reported in the Indian press. Indians make up a quarter of current 457 visa holders, and are also currently the largest immigrant group to the country (through the permanent residency program). Australia’s desire to improve the relationship will require the longer-term benefits of people-to-people connections and intimate on-the-ground knowledge that immigrants provide.
The rise of parochial populism should have presented a great opportunity for Australia, not as a strategy to ape, but as a chance to vacuum up those skilled persons turned away, or indeed turned off, by increased nativist sentiment in other countries. The one-dimensional nationalism employed by the Australian government remains the tactic of the lazy politician. It demonstrates both a reluctance to explain more complex ideas to the public, and a lack of faith in the public’s ability to be persuaded by evidence-based arguments. While these changes to Australia’s immigration procedures may give the government the bump in the polls it desires, ultimately these superficial tactics will continue to undermine the public trust in politicians. Which, ironically, has been a factor in the emergence of the populism that they have succumbed to.