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Tightening of 457 Visa Requirements Could Stall Projects
Recent changes to the 457 Visa scheme is creating market confusion and contributing to a worsening skills crisis, according to labour hire agency, Entity Solutions.
Contract professionals on existing 457 Visas and those seeking entry into Australia are being warned to tread with caution when signing Labour Agreements with on-hire agencies.
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February 11, 2008 (FPRC) -- Recent changes to the 457 Visa scheme is creating market confusion and contributing to a worsening skills crisis, according to labour hire agency, Entity Solutions.
Contract professionals on existing 457 Visas and those seeking entry into Australia are being warned to tread with caution when signing Labour Agreements with on-hire agencies.
Entity Solutions, which manages the engagement of 2,500 contract professionals claims that in the short-term rush to be first to market, individuals on 457 Visas may be left high and dry by agencies unable to continue to meet the new strict requirements.
A number of changes have been introduced to the scheme in recent months including new English language requirements, and stricter controls around past work experience. New applicants must have English language skills equivalent to an average band score of 4.5 in an International English Language Testing System (IELTS) test.
The changes follow the federal government's joint standing committee on migration inquiry into temporary business visas earlier this year where the Information Technology Contract and Recruitment Association (ITCRA) called for tougher penalties against businesses that exploit the temporary 457 Visa program.
At the same time major changes to the General Skilled Migration (GSM) program were introduced on September 1, 2007.
Keen to clarify all of these changes, Entity Solutions has written to both the Department of Immigration and to the Minister, Kevin Andrews.
Head of Entity Migration, Lindy Northover, said she has been working hard to allay concerns from enterprises that the changes will cause disruptions and bottlenecks to critical business projects.
"The financial obligations on every company subject to these changes are significant and not correctly managed, it could mean companies that rush in now let everybody down in 24 months time," she said.
" We are taking our time to thoroughly review and research all the implications of these changes before we progress and we urge business and individuals alike to be wary of rushing into new agreements.
"The on-hire market is a highly competitive environment and there may be the temptation for some organisations to not fully disclose their status under the new rules and regulations."
Prior to the rules being tightened, a record number of 457 visas had been issued to IT professionals.
In the nine months to March 31, 2007, 4290 visas were granted to IT firms.
Immigration Minister, Kevin Andrews, said this number is more than the entire previous financial year.
During the previous 12 months a total of 4190 visas were issued.
"If the department continues to approve applications for 457 visas at current rates, the number of IT professionals using the scheme will jump 35 percent this year," Andrews said.
Also this year Andrews announced an additional 5000 places to the Skilled Migration Stream, bringing the total 2007/08 quota to 102,500 places.
Despite global competition for skilled immigrants and migrant workers to Australia, the number of engineers migrating here has doubled compared to the previous year.
The federal government's migration program is running at record levels bringing in 142,930 people for the 2005/06 year, the largest intake since the late 1980s.
A record 97,340 new places were included in the skill stream accounting for 68 percent of the total migration program, according to the department's annual publication 'Population Flows: Immigration Aspects 2007'.
The number of skilled engineers immigrating to Australia nearly doubled with computing professionals maintaining the top occupational group of new migrants to Australia. An estimated 3940 computing professionals migrated last year.
However, Immigration department deputy-secretary, Abul Rivzi, believes the growth of 457 visas will slow next year as higher salaries are making it "uneconomic" to hire foreigners.
Rivzi said the base salary for workers on 457 visas has risen to $71,800 in the first quarter of 2006/07, up from $66,000 for 2005/06.
He said the increase is a policy lever designed to encourage employers to use Australian workers.
But not everyone agrees that rising salaries will stall migration, particularly with Australia's poor population growth.
Jason Baker, the general manager of IBISWorld which tracks economic and business trends, said more migration will be needed in future to offset the nation's aging population and low natural birthrate.
"By the 2030s, net overseas migration will be the only form of population growth in Australia, as our aging population and low fertility rate will see the number of deaths each year takeover the number of babies born," Baker said.
"If our population doesn't increase the economy may stagnate, with a declining workforce causing labor shortages and wage hikes.
"If that happens, we'd expect government policy to allow higher immigration levels."
Author- Sandra Rossi, Computerworld
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