06 September 2010

Australian immigration cuts could exacerbate labour shortages say industry analysts

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Harley Dale, chief economist for the Housing Industry Association (HIA) told the Australian Associated Press there was evidence of existing "widespread labour shortages"

Mr. Dale went on to warn of impending difficulties meeting skilled shortages, which are likely to increase as demand picks up, and the Australian economy continues to grow. At the same time, Australian immigration numbers have reduced by 100,000, year on year with figures released by the Australian Bureau of Statistics (ABS) released in early August showing net permanent and long term arrival numbers 31% to 232,680 in the year to June.

The remarks were made as the political situation in Australia remains unresolved at time of writing, with both major political parties having alluded to potential cuts in migration numbers. Mr Dale expressed concern at large cuts in net migration. "We wouldn't want to see immigration targets that ultimately meant we undershot what we need to maintain a working age population," he said.

The warning comes as economists predict a rise in wage pressures due to the job market tightening as a result of a downturn in the numbers of migrants arriving in Australia. Commsec economist Craig James confirmed there had been a sharp downturn in the arrival of long-term skilled migrants in the year to June 2010 but confirmed there remains a "strong demand” for skills.

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