Bob The Builder

New episode! Learned a lot chatting with Martin Parkinson about the economics of migration policy. The issue that most people haven't properly understood: Australia has built an economy that requires roughly 2 million more workers than our population of citizens and permanent residents can supply. We've drifted into a guest-worker system that no government ever proposed. Is it possible to have an ethical temporary program for unskilled workers where there is no path to permanency? And what does that look like? We also discuss: - International student fees now fund close to 50% of the cost of all university research in Australia, which means a cap on student numbers trades off with research, R&D, and ultimately productivity. (Australian R&D spending already sits at 1.7% of GDP versus an OECD average of 2.7%.) - Australia has 250,000 skilled migrants -- including 50,000 engineers, 20,000 teachers, 16,000 nurses, and 1,300 electricians -- who were admitted because their qualifications were assessed as commensurate with Australian standards, but who cannot work in their fields because of state-government and professional-body licensing barriers. - The Australian skilled-occupation list is based on a 2001 taxonomy, which is why employers trying to bring in a global procurement manager were forced to map the role to "supermarket manager." - The Australian points test is "dumb": being 40 years and 1 month old gets you dramatically fewer points than being 39 years and 11 months -- Canada's system steps down gradually, ours falls off a cliff. - Indonesia's diaspora in Australia is 90,000 people -- the same size as Fiji's, and roughly 0.03% of Indonesia's population -- despite Indonesia being projected to become the world's fourth-largest economy by 2045. - And much more. Watch below - or on YouTube, Apple Podcasts or Spotify. Timestamps: (0:00:00) – Introduction. (0:02:37) – What surprised Parkinson about Australia's immigration system? (0:10:20) – How does migration affect Australians' living standards? (0:16:56) – The political equilibrium (0:19:23) – What are the objectives of the migration program? (0:24:01) – The drift into a guest-worker system (0:41:40) – How leveraged are universities to international students? (0:47:56) – Should we have an official low-skilled migration program? (0:51:32) – Using migration to slow population ageing (0:58:42) – What "skills shortage" actually means (1:08:17) – Problems with the points test (1:14:52) – Our Soviet-style occupation list (1:24:45) – We need to better utilise our skilled migrants (1:34:39) – What is the biggest problem with Australia's migration system? (1:42:01) – How can we attract true global talent? (1:45:58) – Is the migration system robust to AI disruption? (1:53:38) – What should the upper/lower bound for net migration be? (1:56:43) – The Indonesian question (2:06:53) – How much more strategic weight would a bigger population buy us?

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