1. Introduction

Conduct of the inquiry

1.1
On 17 November 2016, the Minister for Immigration and Border Protection, the Hon Peter Dutton MP, and the Minister for Social Services, the Hon Christian Porter MP, asked the Committee to inquire into and report on migrant settlement outcomes. The terms of reference of the inquiry were to have particular regard to:
The mix, coordination and extent of settlement services available and the effectiveness of these services in promoting better settlement outcomes for migrants;
National and international best practice strategies for improving migrant settlement outcomes and prospects;
The importance of English language ability on a migrant’s, or prospective migrant’s, settlement outcome;
Whether current migration processes adequately assess a prospective migrant’s settlement prospects; and
Any other related matter.
1.2
The Committee shall give particular consideration to social engagement of youth migrants, including involvement of youth migrants in anti-social behaviour such as gang activity, and the adequacy of the Migration Act 1958 character test provisions as a means to address issues arising from this behaviour.

Structure of the report

1.3
The Committee’s report is structured around the inquiry’s terms of reference. This introductory chapter provides an outline of the conduct of the inquiry and a brief background on the economic benefits of migration.
1.4
An examination of migrant settlement services administered by the Commonwealth, States and Territories and education and language training for migrants is in Chapters 2 and 3 respectively.
1.5
Chapter 4 considers employment programs for migrants and Chapter 5 looks at the community perceptions of migrants, programs that engage migrant families, in particular parents, and the impact of housing accessibility on migrant families.
1.6
Chapter 6 focuses on extracurricular activities for migrant youth such as sports and the arts and Chapter 7 provides some factual background information on migrant youth and anti-social behaviour; an examination of the character test provisions (section 501 of the Migration Act 1958) and intervention strategies such as mentoring programs and justice reinvestment.
1.7
Chapter 8 provides an overview of the Committee’s Parliamentary delegation to United Kingdom, Sweden, Germany and the United States of America between 2 and 16 July 2017.

Economic benefits of migration

1.8
Prior to examining the evidence received during the course of this inquiry, the Committee wanted to provide a brief overview of the economic benefits of migration generally, particularly in the Australian context and the contribution from humanitarian entrants. The Committee notes that there does not appear to be much recent research or data available.1 However, the Committee is of the view that the conclusions that were reached at those times are just as relevant today as they were when first released.
1.9
There have been a number of studies both internationally and nationally that have considered whether migration is good for the economy.
1.10
The Organisation for Economic Co-operation and Development (OECD) listed a number of positive outcomes from migration in the labour market, the public purse and economic growth:
Labour markets
Migrants fill important niches both in fast-growing and declining sectors of the economy.
Like the native-born, young migrants are better educated than those nearing retirement.
Migrants contribute significantly to labour-market flexibility.
The public purse
Migrants contribute more in taxes and social contributions than they receive in benefits.
Labour migrants have the most positive impact on the public purse.
Employment is the single biggest determinant of migrants’ net fiscal contribution.
Economic growth
Migration boosts the working-age population.
Migrants arrive with skills and contribute to human capital development of receiving countries.
Migrants also contribute to technological progress.2
1.11
The International Monetary Fund (IMF), in their report on the Impact of Migration on Income Levels in Advanced Economies, stated that long-term migration can improve the Gross Domestic Product (GDP) per capita of receiving advanced economies significantly:
… a 1 percentage point increase in the share of migrants in the adult population can raise GDP per capita by up to 2 per cent in the long run. Both high- and low-skilled migrants contribute, in part by complementing the existing skill set of the population. Finally, the gains from immigration appear to be broadly shared.3
1.12
Every five years, the Australian Government produces an intergenerational report that assesses how changes to Australia’s population size and age profile, including through migration, may impact on economic growth, workforce and public finances. In the 2015 Intergenerational Report, the Treasury noted the importance of migration as a source of labour:
Historically, immigration has been an important source of labour supply for Australia. Since at least the 1980s, immigration has made the largest contribution to growth in Australia’s working age population (aged 15 years and over).4
1.13
The Treasury added that migrants increase labour force participation rates:
Participation rates also increase as the level of net overseas migration increases. Migrants tend to be younger, on average, than the resident population, and therefore increase overall labour force participation rates.5
1.14
The Treasury concluded:
… attracting skilled migrants can provide both economic and social benefits to Australia. In an increasingly competitive global labour market, skilled migration that is well targeted and appropriately adjusted to our economic circumstances will support Australian employers and businesses, and provide benefits through a younger and more skilled population in which there are more workers supporting the rest of the community.6
1.15
In March 2015 the Migration Council of Australia released the report, The Economic Impact of Migration, which contained an analysis of the economic contribution of migration to Australia. The report found that:
Migration added 15.7 per cent to our workforce participation rate; 21.9 per cent to after tax real wages for low skilled workers; and 5.9 per cent in GDP per capita growth;7 and
The economy will be 40 per cent larger as a result of migration and contributing approximately $1.6 trillion to the Australian economy.8
1.16
More specifically, research shows that humanitarian entrants provide a number of economic benefits.
1.17
In June 2006, the former Department of Immigration and Citizenship completed a research paper on the Economic, social and civic contributions of first and second generation humanitarian entrants. The research paper found:
Humanitarian entrants help meet labour shortages, including in low skill and low paid occupations. They display strong entrepreneurial qualities compared with other migrant groups, with a higher than average proportion engaging in small and medium business enterprises.
Humanitarian settlers benefit the wider community through developing and maintaining economic linkages with their origin countries. In addition, they make significant contributions through volunteering in both the wider community and within their own community groups.9
1.18
The report concluded that while the initial years of settlement are difficult, there is strong evidence to show both an economic and social benefit to Australia:
The initial years of settlement of humanitarian settlers are often difficult and intensive in the use of government provided support services. The circumstances of their migration make this inevitable. Nevertheless the evidence which has been assembled here has demonstrated that over time there is a strong pattern of not only economic and social adjustment but also of significant contribution to the wider society and economy.10

  • 1
    The most recent data available on the economic benefits of migration is from 2015.
  • 2
    OECD, Migration Policy Debates, Is migration good for the economy?, May 2014, p. 1.
  • 3
    International Monetary Fund, Impact of Migration on Income Levels in Advanced Economies, 23 December 2016, p. 1.
  • 4
    The Treasury, 2015 Intergenerational Report, March 2015, p. 11.
  • 5
    The Treasury, 2015 Intergenerational Report, March 2015, p. 19.
  • 6
    The Treasury, 2015 Intergenerational Report, March 2015, pp. 96-97.
  • 7
    Migration Council of Australia, The Economic Impact of Migration, March 2015, p. 2.
  • 8
    Migration Council of Australia, The Economic Impact of Migration, March 2015, p. 14.
  • 9
    Department of Immigration and Citizenship, Economic, social and civic contributions of first and second generation humanitarian entrants, June 2006, p. 1.
  • 10
    Department of Immigration and Citizenship, Economic, social and civic contributions of first and second generation humanitarian entrants, June 2006, p. 256.

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