Australia to Slash Immigration by 14% in Battle to Save Jobs From Foreign Workers During Recession

Australia is set to protect its workers during the looming recession by slashing its intake of skilled migrants for the first time in a decade.

The 14 per cent cut in immigration come on a wave of concern that skilled foreign workers could stoke resentment by taking jobs at a time of rising unemployment.

One expert slammed the situation as ‘madness’ after mine workers in Queensland and Western Australia found that their positions were being filled by foreign workers.

Immigration Minister Chris Evans, who removed hairdressers and cooks off Australia’s critical occupation shortage list at Christmas, said he was now also deleting foreign bricklayers, plumbers, carpenters and electricians from the list that guides skilled migration intake.

Further cuts were likely in the May 12 budget, he said, leaving only health occupations, engineering and information technology skills as needed skills.

‘What we’ll look to do is run a smaller programme and keep the capacity to make sure we can bring in any labour we might need as the year develops,’ Evans said.

A recession is looming in the country, with the centre-left government expecting unemployment to reach seven percent midway through next year.

The country is also due to hold an election in late 2010. Immigration has been a charged issue in past polls, particularly following economic downturn.

A leading migration expert, former government official Bob Kinnaird, said record recent migrant arrivals in a fast shrinking job market were leading to ‘highly combustible’ conditions in regional areas, where many new arrivals had settled.

In Queensland and Western Australia retrenched mine workers returning to their home towns found that jobs there had been filled by foreign workers, sparking resentment, Kinnaird said.

‘You could say in those last few months that madness has reigned,’ he told the Brisbane Times newspaper.

The ruling Labor Party, with its roots in the workers’ movement, should have acted sooner to cut migration as economic conditions cooled to lance any voter backlash and ease tensions in critical country voting areas, he said.

But the Australian Chamber of Commerce and Industry said the government needed to be wary of tinkering with immigration, as many skilled employment areas still faced a worker shortage and lack of workers could crimp an economic recovery.

‘We would have preferred a status quo position,’ chamber Chief Executive Peter Anderson said.

Australia is a nation of immigrants. The country has been enjoying a boom in new arrivals for the past decade to help meet labour shortages as a China-fuelled mining boom drove unemployment rates to 30-year lows.

But those days are over now. Six of Australia’s major trading partners are now in recession and economic growth has stalled.

The country moved a step closer to recession this month with the first contraction in eight years and the economy shrinking by 0.5 per cent.

Australia’s jobless rate spiked to 5.2 per cent from 4.8 per cent last month with the biggest impact felt by full-time workers. Some economists fear unemployment levels could go as high as 10 per cent.

A government minister said today the immigration intake next year would be cut to 115,000, from 133,500 in 2008-09.

The government hopes its recently announced A$42 billion ($27.5 billion) stimulus package, including cash handouts and infrastructure spending, will help the economy through the downturn.