Strong immigration program essential in tough economic times

"Ai Group had been concerned that any potential cut to the immigration program would have carried economic risks. Considering that there can be as much as a two year lag between application and arrival, any cut in the program today would have delivered a cut in the skilled migrant intake just as we were emerging from the economic crisis.

"The immigration program makes a huge contribution to the economy. In recent years studies have indicated that migration into Australia, particularly skilled migration, boosts domestic living standards, the supply of skilled labour and government revenues. Ai Group's own research suggests that immigration could contribute up to a third of our average annual GDP growth during the coming decade.

"The decision to modify the list of eligible occupations is understandable and the focus on medical, ICT, engineering and construction skills will be welcomed by business.

"Industry will also be looking to increase its use of the Employer Nomination Scheme in response to the announcement and is hopeful that the promised fast tracking under the system will be delivered effectively. Employers find that nominating temporary 457 visa holders for permanent residence takes far too long and these visa holders, who already have skills and jobs, make some of our best new migrants.

"The 457 temporary entry visa program is demand driven and is an important and flexible economic shock absorber. Its use is as expected declining as pressures grow on employment. This rebalancing of immigration numbers should allay concerns that the permanent program could take jobs at a time when unemployment may be on the increase.

"The flipside of the debate over the immigration program is the return to Australia of increasing numbers of Australians due to the impact of the global economic and financial crisis. Many of these people will be highly skilled and how the economy utilizes their skills and capabilities will be a major challenge to public policy in 2009," Ridout said.