Migration cuts already impact on the economy, economists say
Cuts to immigration could have serious consequences for the nation’s economy, experts have warned.
Changes to visas for skilled workers have already had a sudden impact on population growth with new Australian Bureau of Statistics (ABS) showing that Australia’s annualised population growth rate slowed for the fourth consecutive quarter.
Australia’s overseas migration fell by 9 per cent since changes to visa requirements came into force in April 2017, slowing the population growth rate to 1.6 per cent.
In April 2017, Australia introduced a range of visa changes which have been successful in reducing the number of skilled migrants arriving in Australia.
According to economist, Dr Ian Pringle the current phase of Australia’s 28 years of continuous economic growth is built upon the arrival of skilled migrants.
“Skilled migration is necessary to offset the impact of our aging population,” he said.
But states such as Victoria and New South Wales, which have benefited the most from overseas migration over recent years are now seeing population growth rates slowing.
“The slowing rate of population growth, while it remains high for a developed economy, will contribute to slower growth of household consumption. This means slower growth in sectors such as retail and residential building,” Dr Pringle said.
“Given that these two sectors are amongst the nation’s largest employers the risks presented a decline in population growth should not be underestimated,” he said.
Over the year to March 2018, Victoria saw the strongest growth in population with an increase of 2.2 per cent, followed by the ACT at 2.1 per cent and Queensland and with 1.7 per cent growth.
New South Wales was fourth fastest with 1.6 per cent, with Tasmania fifth with 1 per cent, Western Australia sixth at 0.8 per cent and South Australia at 0.7 per cent.
The population of the Northern Territory has declined over the last two quarters and the annual rate of growth has slowed to just 0.1 per cent.
With home prices falling, access to finance more difficult and fewer people now entering the country, the number of new homes approved for construction has declined.
The ABS data released showed that 16,447 homes were approved for construction in August – a 9.4 per cent drop from the July figure and 13.6 per cent lower than in August 2017.
The August level of approvals is the lowest since October 2016.
Dr Pringle says that stricter visa requirements may be discouraging potential migrants.
“As economies improve around the globe, skilled migrants who may otherwise have considered coming to Australia could be more likely to look to other advanced economies where entry requirements are less restrictive,” he said.
AMES Australia Senior Journalist