Cameo 3. The Two-Step Australian Immigration Policy and its Impact on Immigrant Employment Outcomes

Three decades ago, most immigrants to Australia with work entitlements came as permanent settlers. Today the annual allocation of temporary visas, with work entitlements, outnumbers permanent settler visas by a ratio of three to one. The new environment, with so many temporary visa holders, has led to a two-step immigration policy whereby an increasing proportion of immigrants come first as a temporary immigrant, to work or study, and then seek to move to permanent status. Around one-half of permanent visas are allocated onshore to those who hold temporary visas with work rights. The labor market implications of this new two-step system are substantial. Immigrants from non-English-speaking countries (NES) are affected most. In their early years in Australia, they have substantially reduced full-time employment and substantially increased part-time employment, usually while attending an education institution. Three years after arrival, one-third of NES immigrants are now employed part-time which, rather than unemployment, is becoming their principal pathway to full-time labor market integration. Surprisingly, little has changed for immigrants from English-speaking countries (ES).