Enterprise Migration Agreements - why won’t Australians do the work?

An iron ore project in Western Australia similar to that proposed by Gina Rinehart at Roy Hill. AAP Image/Rebecca Le May

The announcement that controversial mining billionaire Gina Rinehart is to use new Enterprise Migration Agreements to employ 1715 foreign construction workers on her $9.5 billion Roy Hill iron ore project has sparked widespread debate.

With the economy slowing in eastern states like NSW and Victoria, why is Rinehart bringing in foreign labour? It is a ploy, as some in the union movement suggest, to lower wages and conditions?

Or does it illustrate a telling lack of labour mobility in Australia, where people are unwilling to move to the harsh environments where well-paid mining jobs are located?

Married to the emerging evidence of the physical and psychological toll suffered by Fly In, Fly Out (FIFO) workers, are we at a situation where we need to accept that foreign labour is the only way Australia will maximise its mining boom?

The Conversation spoke with ANU’s Professor of Demography Peter McDonald to discover where people are and are not coming from and what efforts are being made to entice Australians to move the boom states.

Where are the key source states for internal migration to employment growth areas like Western Australia?

Submissions to the House of Representatives Standing Committee on Regional Australia’s inquiry into the experience of FIFO and DIDO (drive in – drive out) workers provide the best indications of answers to this question.

These submissions state that overwhelmingly FIFO workers in Western Australia are sourced from the Perth and Peel regions of Western Australia. Companies are trying to spread the source destinations to include other regional areas of Western Australia.

So, most workers in the WA resources industry come from Western Australia itself, but this may include people who have moved to Perth and Peel from other parts of Australia or from the rest of the world. The Australian Bureau of Statistics publishes internal movement data showing both source and destination only at the state and territory level.

In the 2010-11 financial year, 36,815 people moved to Western Australia from other states and territories but 30,652 moved in the opposite direction yielding a net movement to WA of 6,162, a small number. The net movement to WA was dominated by New South Wales (2352), Queensland (1567), South Australia (925) and the Northern Territory (760).

For perspective, net overseas migration to Western Australia in 2010-11 was 30,805. almost six times the population gain from other parts of Australia. In turn, most of the gain from overseas was in the category “long-term visitors”, or temporary immigrants (25,623).

What kind of programs has the Australian Government used to try and promote internal migration? What other levers could they use?

I am not aware of any policy approaches that have been used to promote movement to Western Australia from other states and territories. There are programs to assist unemployed people to move to places of employment but these are not specifically directed at the mining industry or Western Australia.

Mining companies themselves, of course, will provide incentives to workers to come on board with their companies. It is highly likely that other states and territories would object to a policy approach that encouraged residents of State X to move to Western Australia. There is some FIFO movement to WA from other states and expansion of this option could be considered, but it is a relatively expensive option for the companies.

How do EMAs and 457s compare to programs used by comparable Western countries to attract short term labour on individual projects?

Most OECD countries are not comparable because they are not experiencing labour shortages. The reverse tends to be the case.

The only really comparable country is Canada. About 150,000 foreign workers enter Canada each year on a temporary basis to cover skill shortages, much higher than the equivalent category in Australia (the 457 visa subclass). The larger number going to Canada is associated with acceptance in Canada of lower skill levels than is the case in Australia and also with the loss of Canadians to the United States.

Where are the current key source countries for migration to WA?

The United Kingdom is by far the largest source of both permanent and temporary migrants to Western Australia. Around 10,000 people arrived in Western Australia from the UK in 2010-11 compared to the (net) movement from the rest of Australia of just over 6,000.

Other major sources of temporary immigrants are (in order after the UK) the Philippines, Ireland, the United States and India. South Africa is second to the UK as a source of permanent migrants to Western Australia.