Friday, September 12, 2008

Skill Shortages - Part 4

It is interesting to discover the large amount of quality material in the public domain about "skill shortages" - the only question is why we still keep blabbering on about it - perhaps it has something to do with "vested interests" trying to control the agenda. Anyway, this article by Sam Varghese in March 15, 2005 is still relevant in 2008.

The talk of a skills shortage in ICT labour market is perplexing because most available data points in exactly the opposite direction, a leading labour market consultant says.

Bob Kinnaird, who is with the Sydney firm of R.T. Kinnaird and Associates, said there was no evidence to justify the claims of a shortage of qualified labour among IT graduates, post-graduates or experienced professionals.

Kinnaird undertook a study for the Australian Computer Society last year which found that migrant IT workers were depriving Australian IT workers of jobs. The report was never released by the ACS, according to a report in the Australian Financial Review.
However, a copy was passed to the then communications minister Daryl Williams and distributed to several government departments.

Kinnaird said today that the ACS had commissioned him to do an update to the report which he had completed and submitted. "They are considering that report and planning to release their policy along with the report's findings by the end of this month," he said.

In defence of the ACS, Kinnaird said they had commissioned a study and were now willing to pay for an update. "The government departments should be doing this because the government is responsible for immigration policy, not the ACS," he said.

"The immigration department is supposed to take advice from the department of employment and workplace relations about matters such as this. One would expect immigration to also speak to the ICT department and the minister. Why that didn't happen last year, when they had copies of the report which the ACS commissioned, I guess you'd have to ask the departments concerned."

Kinnaird said all available evidence pointed to a massive oversupply of IT graduates.

"Thirty percent of IT graduates can't find full-time work. This is much higher than the other professions where 20 percent can't find permanent work," he said. "Last year, there were about 2000 IT graduates out there in the market without jobs, these being from the 2003 graduation class."

He said among post-graduates, 26 percent could not find full-time jobs. "The figure for other fields is 12 percent, so there is no justification to speak of a manpower shortage."

Among general IT professionals, Kinnaird said the unemployment figure was relatively high compared to the past - 4 percent for IT pros, 2 percent for other professionals.

He pointed to government statistics which show that there are more suitable applicants for IT vacancies now than a couple of years ago. "In May 2004, there were 5.8 suitable applications for each vacancy; in 2003, it was 5.5. And this judgement is made by employers, not recruitment agencies. The figure was 3 during the height of the tech boom."

Kinnaird said the situation in NSW was tighter than in some other states but said he could not provide figures right away.

"No doubt, the labour market is improving. But if people are talking about shortages of skilled IT personnel and a skills crisis, then one would think that they should produce some evidence of the same," he said.

Kinnaird again pointed to government statistics published in the last few weeks to show that migration was adding to ICT oversupply.

"The number of ICT visas issued in 2003-04 was 9400, of which about 50 percent (4800) were onshore visas, meaning visas for overseas students graduating in ICT from Australian universities. That represents an increase on the number issued in 2002-03.
"The increase was over 50 percent, from around 6000 visas in 2002-03. In other words, while 30 percent of Australian IT graduates could not find a full-time job in 2004 (2000 people), the government actually increased the ICT immigration intake by 50 percent from 6000 to 9400.

"That shows how ICT immigration has got out of line with the ICT labour market reality. My report to the ACS suggests ways of fixing this," he said.

Thursday, September 4, 2008

Skill Shortages - Part 3

I have previously accused the mainstream media of regurgitating the press releases of "vested interests" and now I am about to do the same. Here is a relevant one from the Australian Computer Society (ACS) from September last year.

-- Start of Press Release --

September 12, 2007 - 1:47PM

While Australia continues to have its lowest unemployment rate in decades, ICT professionals in their middle years aren't sharing in the rewards.

One in three ICT professionals in the 41- to 50-year-old age bracket have been unemployed in the past five years, at a time when the sector is experiencing an unemployment rate of 3.84 per cent, nearly half a per cent lower than the national average.

This is one of findings from the Information and Communications Technology (ICT) Employment Survey for 2007, released today by the Australia Computer Society (ACS).

ACS president Philip Argy said the higher level of unemployment across the 41-50 age group was of concern.

"It is more likely that this unemployment is derived from a combination of age discrimination and either real or imagined concerns about the currency of their ICT skills."

The survey also revealed that 19.2 per cent of respondents felt that they had experienced discrimination on the basis of their age, and 9.6 per cent of respondents felt that they had been discriminated against on the basis of race and ethnicity.

"The survey results demonstrate that mature and experienced workers are being sidelined and their skill levels and corporate memory are being ignored. With the ICT industry suffering from major skills shortages, Australia is not in a position to ignore skilled professionals," Argy said.

Another disturbing finding in the survey is that 27.8 per cent of female respondents felt they had been discriminated against on the basis of gender, compared to 1.5 per cent of males.

It also found that sexual discrimination was significantly higher in Queensland and Western Australia.

-- End of Press Release --

The ICT industry in Australia, in particular has been decimated by the talking up of "skill shortages" and the bringing in of foreign workers under the 457 visa.

Clearly big business have discarded and ignored older workers because they have been able to easily import younger, cheaper and more compliant foreign substitutes.

And our Immigration Department and it's policy people have obviously been no intellectual match for the *spin meisters* employed by the large foreign owned ICT companies that have driven this agenda and which has been so damaging to Australian ICT workers.

So the message is rather stark.

If our Immigration Department has been "rolled" by the large ICT companies – why wouldn’t they have also been "rolled" by other large industries?

The truth is that they have been.

As I said previously – "Skill Shortages – its mostly BS".

Skill Shortages – Part 2

It is difficult to find an impartial analyst – especially one who is both curious enough and thorough enough to uncover the facts and present the truth on the story of Australia’s "skill shortages" - and related government policy.

And the story of the 457 visa has been clouded by claim and counterclaim. To uncover the truth we need to dig deep to find and then discard the views of "vested interests" whose job it is to obfuscate.

For example, according to the Immigration Department, the latest (July 2008) figures show the average salary for a 457 visa-holder is around $73,000 and this is often compared with the average Australian salary of about $55,000 – all supposedly to demonstrate that these folks are being well paid – and so we should not be concerned.

The problem is that around 81% of the incoming workers are professionals – a significantly higher percentage than the Australian workforce generally. So you can see how this is an example of using selected statistics to skew the truth.

Journalists in the mainstream media in particular have been guilty of this – often just regurgitating the spin that is put about by "vested interests".

For a fairly complete and somewhat impartial commentary on the 457 visa there is a transcript of an interview between Peter Mares, Bob Kinnaird and Siew-Ean Khoo here.

As Bob Kinnaird says, "The key concerns about the IT area in 457s are that the visa grants in IT were actually increasing during a period of downturn in the graduate labour market in particular in Australia. Over the period 2001 to 2005 we had record levels of graduate unemployment amongst Australian graduates from computer science courses, yet the department was actually increasing the number of visa grants to young 457 visa holders and predominantly the growth was going to people from Indian companies and their salaries were being approved at very low rates".

The results of these "unintended consequences" are there for all to see in the shunning of computer science courses by young Australians in 2008. They observed what happened and have voted with their feet – often moving to legal and medical studies – which are seen as being "safer".

Meanwhile, the salaries of IT workers have plummeted and the bar has been moved ever lower. There does appear to be a key linkage between talking up "skill shortages" and driving down the salaries of Australian workers.

And we talk about being the "clever country".

Tuesday, September 2, 2008

Skill Shortages - it's mostly BS

I keep hearing the nonsense that serious "skill shortages" exist in this country – most recently from someone who shall remain nameless - but who should know better.

Those people who are pushing the "skill shortages" barrow are really just vested interests who are trying to gain an advantage – usually at the expense of the rest of us.

So who are these vested interests?

Well mainly it is big business – often supported by small business – who have been *geed* up by the industry associations – which in turn have been setup by big business.

And often these vested interests have been aided and abetted by the recruitment industry – because these people live on the fees generated as labour moves around.

Big business has been driving the "skill shortages" agenda for a few years now – it’s all designed to drive down the cost of labour and to put pressure on government to allow the importation of foreign workers – often under the 457 visa.

The theory is that if business can control the importation of workers then they can more closely control who they bring in and at what cost. From the business perspective this is all about control over the supply and cost of foreign labour – which can then be used to set the benchmark for the cost of local labour.

There is also much greater opportunity to exploit vulnerable foreign workers as they often owe their employment, income prospects and immigration status to their business sponsor.

Who is looking after these workers?

The issue for me is that there has been no "expose" of what is going on – neither governments nor the media have done anything to raise awareness - why?