How is New Temporary Skill Shortage Visa Impacting Job Seekers in Australia

How is New Temporary Skill Shortage Visa Impacting Job Seekers in Australia
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On 18 April 2017, Australian Prime Minister Malcolm Turnbull announced the abolishment of the Temporary Work visa, also known as the 457 visa.

Namely, it will be replaced with the Temporary Skill Shortage (TSS) visa program by March 2018. The main aim of this radical reform is to secure more jobs for Australians and cut immigration numbers. “We’ll no longer let 457 visas be passports to jobs that could and should go to Australians,” Turnbull emphasized.

But, how will they make this program work? Most importantly, what do these stricter conditions mean for foreign job seekers?

Let’s find out.

The 457 Visa: The Overview

The Temporary Work visa was introduced by the Howard government in 1996. Ever since then, it allowed thousands of skilled foreign employees to work and live in Australia, filling jobs in more than 650 occupations.

Unsurprisingly, the program gained momentum during the 2008 Global Financial Crisis.

Given the fact that Australia is one of the fastest growing countries, with the solid economy, high wages, and a strong dollar, it attracted a plethora of skilled overseas workers looking for better working conditions and higher paying jobs. Obviously, this has been a win-win scenario for both employers and job seekers, boosting Australia’s economic stability.

The benefits of the 457 visa for foreigners

According to a 2016 research, roughly 95000 people are living in Australia on primary 457. These visas are usually sponsored by business owners aiming to fill the gaps in skilled labor. On the other hand, secondary visas cover family members, accompanying primary visa holders.

The benefits of the 457 visa plan for foreigners are multiple. For starters, they are allowed to bring any family members, who are provided with unlimited work and study rights. Also, the holders of this visa can freely travel in or out of Australia. Finally, they are given the opportunity to be sponsored by Australian organizations and apply for permanent residency.

What are the requirements?

Given all these perks of the Temporary Work visa, it’s not surprising at all that its requirements are pretty strict. To be sponsored, applicants need to be approved by the Department of Immigration and Border Protection.

Additionally, they are restricted to working for their sponsor and may not work for any other company. They also need to meet at least some minimum English language, skill, and health requirements.

What Changes can we Expect to See?

Regardless of all the benefits of the 457 visa, there has been a long history of problems related to this program, including the rising number of systematic scams and the exploitation of foreign workers.

The Turnbull government claims that the reforms regarding 457 visas are triggered by these rising issues. Namely, the new TSS visa program consists of two streams- the Short-term visa, issued for two years and the Medium-term visa, issued for four years.

The latter one is specialized and targets higher skills. Now, the 457 reform has brought new challenges to the table for those willing to apply.

Here are some of them:

  • The government has introduced labor market testing, a market salary rate assessment, and a non-discriminatory workforce test.
  • The applicants for the TSS visa will need to meet higher English language requirements.
  • They need to undergo a criminal check.
  • For the majority of applicants, the age limit plummeted from 50 to 45.
  • They need to have at least two years of work experience
  • The TSS visa will be more expensive, when compared to the $1,060 the 457 visa cost. While the Short-term visa is expected to cost $1,150, the Medium-term one will be about $2,400.
Which Professions will be Affected by the TSS Visa?

The greatest change the reform brings is the reduction of eligible skill occupations from 651 to 435. The occupations removed from the list include web developers, air traffic controllers, archivists, biochemists, dental therapists, as well as a wide range of creative professions, such as composers, actors, photographers, and singers.

The list of eligible occupations will be constantly monitored and altered every six months to meet the market demands.

Even though it is still impossible to precisely estimate how the implementation of the TSS visa program is going to impact Australian business recruitment habits, it is obvious that the sectors that will be most affected by these changes are:

  • IT, which is the largest sponsor, by the way
  • professional services
  • scientific services
  • technical services
  • accommodation services
  • food services
What about the Current 457 Visa Holders?

Now that the full implementation of the TSS visa is approaching, the Prime Minister highlighted that the reform won’t affect current 457 visa holders. So, if you’re already under this program, you have nothing to worry about.  At least for now.

However, one thing is going to change completely and that’s the government’s attitude towards permanent residency.

Namely, one of the most attractive features of the 457 visa is a chance it gave to the visa holders to get Australian Permanent Residency (PR) after only two years of working there. Namely, the government is striving to reduce this, so-called, open-ended nature of the 457 visa program. They have already announced that the applicants under the Short-term visa won’t be allowed to apply for PR.

“What we propose is that under the Temporary Skills Shortage visa short-term stream there will be a two-year visa, with the options of two years, but there won’t be permanent residency outcomes at the end of that,” Immigration Minister Peter Dutton claims.

To Wrap it Up

No matter how worrisome this may be, the 457 reform will have a minor influence on the overall employment practices, economic growth, and overseas migration.

However, the indirect impact of these changes is what should really concern us. Stricter norms, the age limit, and higher English language competency standards may discourage skillful foreign workers from applying.

Today, skilled and aspiring workers are in high demand everywhere in the world, irrespective of their nationality or race, which gives them the opportunity to choose where they will live and work.

The mere fact that Australia has become pretty inhospitable to skilled overseas employees might drive them to some other countries that are seen as more friendly.

Author: Nate Vickery

Nate M. Vickery is a business consultant from Sydney, Australia. His fields of expertise are company management and efficient work environment through latest technology trends, as well as internet marketing. He is also an editor in chief at bizzmarkblog.com.

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