We need to look beyond just Sydney and Melbourne
Migrants may have saved the day for Australian economy but unless migrant population is spread across the country, we will be staring at a bigger problem.
There’s only one country that has not had a recession in last 25 years and that’s the country we all call home: Australia.
Now that would make the chest of all politicians here to swell and rush to take credit but all is not hunky-dory below the surface.
While it’s true that Australian economy has been saved of the recessionary blushes but if one looks at the employment numbers and the growth of real wages, the picture becomes really bleak. Real wage growth has slowed down to just 1.9 per cent annually and what’s more, the unemployment too has shot up to 5.75 per cent. So what gives?
Well, migration is keeping the economic engine well-oiled but it is also making things difficult for those already here—and that includes a lot of new migrants too!
First of all, the concentration of migrants is limited to mostly two big cities: Sydney and Melbourne. This again sets off another chain of problems which is housing affordability and wage growth. Housing prices in Sydney are up over 70 per cent in last 5 years and in some instances rentals are eating up over 50 per cent of people’s salary. There is no way it can be sustained for long.
If only two cities have to take the load of not only new people coming in but also the entire economy then we are staring at an impending crisis.
A few things can be done to evenly spread the migrant population and also tackle the aforementioned issues.
First of all, New South Wales and Victoria should do away with providing 5 points for state nomination for skilled visas for a few years. This will encourage prospective migrants to look for other states which provide the extra 5 points for state nomination. As most of 457 visa holders also call these cities home, local businesses should be encouraged to set up bases in other cities so that some of these visa holders can be diverted to other cities.
A city like Adelaide which has such great infrastructure and affordable housing options finds no takers precisely because people are not incentivised to look up to this option. Same is true for Western Australia which has the size of an entire Europe but just 2 million people living there. Sydney, for instance, has 6 million!
Let’s face it. Australia will need immigrants for many years to come now given its size and annual population growth. But it is imperative that it is made a win-win situation for both the parties. While migrants will have a new home, the government of the day can further fuel the growth engine through them.
