From the newsrooms of the Sydney Morning Herald and The Age. This is the morning edition. I'm Samantha Selinger Morris. It's Tuesday, April 1st. Immigration has been a vexed subject in Australia and used in political campaigns, past and present. We are a nation, after all, that enacted what became known as the White Australia Policy way back in 1901. And who can forget John Howard's potent Stop the Boats election campaign of 2001? Meanwhile, just recently, we've experienced an unprecedented surge in migrant numbers. So the issue is once again at the heart of a federal election to be held in less than five weeks time. Today, senior economics correspondent Shane Wright on what impact immigration has on our economy and whether there's a sweet spot of numbers we should be striving for. So, Shane, I want to start by asking you why, just briefly, immigration is such a key federal election issue this year.

From the newsrooms of the Sydney Morning Herald and The Age. This is the morning edition. I'm Samantha Selinger Morris. It's Tuesday, April 1st. Immigration has been a vexed subject in Australia and used in political campaigns, past and present. We are a nation, after all, that enacted what became known as the White Australia Policy way back in 1901. And who can forget John Howard's potent Stop the Boats election campaign of 2001? Meanwhile, just recently, we've experienced an unprecedented surge in migrant numbers. So the issue is once again at the heart of a federal election to be held in less than five weeks time. Today, senior economics correspondent Shane Wright on what impact immigration has on our economy and whether there's a sweet spot of numbers we should be striving for. So, Shane, I want to start by asking you why, just briefly, immigration is such a key federal election issue this year.

Well, it's often at the periphery of election campaigns, but the last couple of years has really been reinforced by the fact that we've actually seen an absolute record number of migrants come into the country.

Well, it's often at the periphery of election campaigns, but the last couple of years has really been reinforced by the fact that we've actually seen an absolute record number of migrants come into the country.

Opposition leader Peter Dutton has vowed to get Australia back on track in his budget reply, promising to slash permanent migration by 25% to tackle the housing crisis.

Opposition leader Peter Dutton has vowed to get Australia back on track in his budget reply, promising to slash permanent migration by 25% to tackle the housing crisis.

We will cut the migration intake to free up housing and restore the great Australian dream of home ownership.

We will cut the migration intake to free up housing and restore the great Australian dream of home ownership.

It's really just come to the fore, not just here. Um, our mate Donald Trump has been playing very hard and loose around population growth and migrants. Europe. Britain. Brexit was all driven in part by this. Migration is one of those touchstone issues that every now and again really comes to the fore. And that's what we've seen in the last 18, 24 months.

It's really just come to the fore, not just here. Um, our mate Donald Trump has been playing very hard and loose around population growth and migrants. Europe. Britain. Brexit was all driven in part by this. Migration is one of those touchstone issues that every now and again really comes to the fore. And that's what we've seen in the last 18, 24 months.

Okay. And you've mentioned record numbers there in terms of immigrants who are here in Australia. So roughly, how many migrants do we actually have here and, and tell us how high, how high this number is.

Okay. And you've mentioned record numbers there in terms of immigrants who are here in Australia. So roughly, how many migrants do we actually have here and, and tell us how high, how high this number is.

Well, migrants like ultimately I think we're looking at 1 in 4 Australians are foreign born. And you are an example, my friend of of migrant. We are a migrant nation. But during Covid, net overseas migration was 94,000 people out of the country. We have never had so many people outside of war leave the country in a in a 12 month period. Within two years, net overseas migration hit a record high of 555,000. So we're not talking about permanent migration. We are talking about net overseas migration, which includes people on visas who are here for maybe one, two, three, 4 or 5 years. So you can see if you go from -94 to plus 555,000, that in a very short period of time, that's a huge movement. Now it's come down in the 12 months to the end of September, which is the latest data. We're down to 387,000. But that is still historically a very high level. The government thinks it will get down to 225,000 within two years. That's if everything goes right. And not everything has gone right over recent years. So we are still talking. Let's see. The population of Canberra is the largest inland city in the country is 500,000. So in one year, only a couple of years ago, you actually had the entire population of Canberra move into the country requiring services, housing calls, calls on all sorts of services, from fuel to petrol to food. So you can see why people get a little bit antsy when you get into this space.

Well, migrants like ultimately I think we're looking at 1 in 4 Australians are foreign born. And you are an example, my friend of of migrant. We are a migrant nation. But during Covid, net overseas migration was 94,000 people out of the country. We have never had so many people outside of war leave the country in a in a 12 month period. Within two years, net overseas migration hit a record high of 555,000. So we're not talking about permanent migration. We are talking about net overseas migration, which includes people on visas who are here for maybe one, two, three, 4 or 5 years. So you can see if you go from -94 to plus 555,000, that in a very short period of time, that's a huge movement. Now it's come down in the 12 months to the end of September, which is the latest data. We're down to 387,000. But that is still historically a very high level. The government thinks it will get down to 225,000 within two years. That's if everything goes right. And not everything has gone right over recent years. So we are still talking. Let's see. The population of Canberra is the largest inland city in the country is 500,000. So in one year, only a couple of years ago, you actually had the entire population of Canberra move into the country requiring services, housing calls, calls on all sorts of services, from fuel to petrol to food. So you can see why people get a little bit antsy when you get into this space.

But tell us. So why have these numbers swelled so high in recent years?

But tell us. So why have these numbers swelled so high in recent years?

Well, there are lots of things going on. One was the closure of the border. A lot of them are students who couldn't get into the country when the border was reopened for Covid. You had all these students say, right, I can get into the country and do my university degree. Really key issue globally. Borders fell everywhere, and we remember the rush of people who wanted to get out of the country, to go see family, go on holidays. And you had all this pent up demand from people wanting to get to a job. So you had hundreds of thousands of people who were actually on working visas, who hadn't been able to get into the country, were finally able to. So you really condensed. You condensed about three years of movement into a very short period of time.

Well, there are lots of things going on. One was the closure of the border. A lot of them are students who couldn't get into the country when the border was reopened for Covid. You had all these students say, right, I can get into the country and do my university degree. Really key issue globally. Borders fell everywhere, and we remember the rush of people who wanted to get out of the country, to go see family, go on holidays. And you had all this pent up demand from people wanting to get to a job. So you had hundreds of thousands of people who were actually on working visas, who hadn't been able to get into the country, were finally able to. So you really condensed. You condensed about three years of movement into a very short period of time.

Okay. So very specific reasons why the numbers really just rose so high. But now, as you've just written, the numbers are actually predicted to really drop off. So why is that going to happen?

Okay. So very specific reasons why the numbers really just rose so high. But now, as you've just written, the numbers are actually predicted to really drop off. So why is that going to happen?

Well, a lot of this goes down, down to the visas that people came in on. We had a couple of Covid era specific changes, one by the previous government, one by the current government. One was there were people trapped in the country who could not get back home because of various closures around their borders, so their visas were extended. These people had to work, had to earn money, and they've gone, oh, I'll just call Australia home. So you've had that group that was the previous government. The current government, say extended um from 2 to 4 years the length of time visas for graduate students. Now, this was aimed specifically at tapping really highly trained people. These are people with PhDs or masters and things like that and go, right, we want to tap their skills and keep them in the country for a bit longer. And they have. So those visas have been extended and a lot of those visas start to fall over next year and largely into 2027. So you can see you've got this bulge of people on some visas and who are going to have to go. You'll have, uh, immigration say, okay, guys, your time is up. It's time to head home. So that's why there's this expectation by Peter MacDonald and Alan Gamlin, both very well recognised demographers who've been used by both sides of well by the Immigration Department to try and track population growth for some time, saying you are going to see this coming down the track.

Well, a lot of this goes down, down to the visas that people came in on. We had a couple of Covid era specific changes, one by the previous government, one by the current government. One was there were people trapped in the country who could not get back home because of various closures around their borders, so their visas were extended. These people had to work, had to earn money, and they've gone, oh, I'll just call Australia home. So you've had that group that was the previous government. The current government, say extended um from 2 to 4 years the length of time visas for graduate students. Now, this was aimed specifically at tapping really highly trained people. These are people with PhDs or masters and things like that and go, right, we want to tap their skills and keep them in the country for a bit longer. And they have. So those visas have been extended and a lot of those visas start to fall over next year and largely into 2027. So you can see you've got this bulge of people on some visas and who are going to have to go. You'll have, uh, immigration say, okay, guys, your time is up. It's time to head home. So that's why there's this expectation by Peter MacDonald and Alan Gamlin, both very well recognised demographers who've been used by both sides of well by the Immigration Department to try and track population growth for some time, saying you are going to see this coming down the track.

And there are particular.

And there are particular.

Cohorts, aren't there, who are sort of expected to be leaving. And among those are people from Britain and Ireland. So why are they fleeing Australia if that's what they're doing?

Cohorts, aren't there, who are sort of expected to be leaving. And among those are people from Britain and Ireland. So why are they fleeing Australia if that's what they're doing?

Well, they'll be kicked out of Australia. These were working holiday visa holders and they like this was part of the free trade agreement that we've signed with the with the Brits and changes around, uh, work entitlements with the EU, of which Ireland is part of. And you had particularly in rural areas we're saying we need working holidaymakers to pick fruit, to pick pick veggies. Those visas were a bit longer. And again, those visas are going to start unwinding fairly quickly in the next 18 months or so. The whole mindset of both previous governments in this space, it was to provide a workforce that the rural sector in particular, and the hospitality sector in particular, were crying out for people. And they came. We laid out the welcome mat and now there are plenty of people angry. Oh hold on. We said come in. Oh, you did come in. That's what's playing out.

Well, they'll be kicked out of Australia. These were working holiday visa holders and they like this was part of the free trade agreement that we've signed with the with the Brits and changes around, uh, work entitlements with the EU, of which Ireland is part of. And you had particularly in rural areas we're saying we need working holidaymakers to pick fruit, to pick pick veggies. Those visas were a bit longer. And again, those visas are going to start unwinding fairly quickly in the next 18 months or so. The whole mindset of both previous governments in this space, it was to provide a workforce that the rural sector in particular, and the hospitality sector in particular, were crying out for people. And they came. We laid out the welcome mat and now there are plenty of people angry. Oh hold on. We said come in. Oh, you did come in. That's what's playing out.

We'll be right back. Okay, so you've got students whose visas are going to be expiring. They're going to be leaving. We've got a lot of people from Britain and Ireland. They're going to be leaving as well. And then there's also a lot of asylum seekers, right, who are factoring into this prediction that migrant numbers are going to really, really drop off.

We'll be right back. Okay, so you've got students whose visas are going to be expiring. They're going to be leaving. We've got a lot of people from Britain and Ireland. They're going to be leaving as well. And then there's also a lot of asylum seekers, right, who are factoring into this prediction that migrant numbers are going to really, really drop off.

Yeah. And that's part and parcel of what's going on in the world, be it South Sudan, be it the Middle East, be it Ukraine that has played a part. The High Court has enforced changes around immigration law as well, which has added to it. McDonald and Gamblin talk about people visa hopping to try and stay in the country as long as possible. Um, which absolutely makes sense. So you've got people on protection visas who will eventually those protection visas run out. We've had bridging visas, which are another, um, part and parcel of the visa network. These people will ultimately be going see you later, alligator. You're out the door.

Yeah. And that's part and parcel of what's going on in the world, be it South Sudan, be it the Middle East, be it Ukraine that has played a part. The High Court has enforced changes around immigration law as well, which has added to it. McDonald and Gamblin talk about people visa hopping to try and stay in the country as long as possible. Um, which absolutely makes sense. So you've got people on protection visas who will eventually those protection visas run out. We've had bridging visas, which are another, um, part and parcel of the visa network. These people will ultimately be going see you later, alligator. You're out the door.

Okay, so we have to ask.

Okay, so we have to ask.

Then, if the numbers do drop so dramatically, what impact might that have on our economy?

Then, if the numbers do drop so dramatically, what impact might that have on our economy?

Well, and this is interesting because the coalition is going to the election saying they will cut not net overseas oversees migration, but permanent migration, which is a subset of net overseas migration, about I think they're saying about 140,000. Treasury. The Treasury Department will say, okay, you can do that, but it will reduce economic growth. There is no two ways about it, because ultimately, if you bring more consumers into it, into a country, they need a place to live. They need a place to eat. They need to clothe themselves. They need to give them. They need access to the power system to keep them cool in summer, warm in winter, that sort of thing. So there is an economic lift from having immigrants. And so if you cut them, you will actually see that in the budget process. In fact, if it wasn't for some of the immigration growth that we've seen over the last two years, Australia would be would have gone into recession. We can see it because in GDP per capita has been negative for a very long time. So the amount of economic pie that we all get to share, you and I, Sam, are getting smaller and smaller slivers of that pie, but the pie is getting larger because there just are more people in the country demanding goods and services.

Well, and this is interesting because the coalition is going to the election saying they will cut not net overseas oversees migration, but permanent migration, which is a subset of net overseas migration, about I think they're saying about 140,000. Treasury. The Treasury Department will say, okay, you can do that, but it will reduce economic growth. There is no two ways about it, because ultimately, if you bring more consumers into it, into a country, they need a place to live. They need a place to eat. They need to clothe themselves. They need to give them. They need access to the power system to keep them cool in summer, warm in winter, that sort of thing. So there is an economic lift from having immigrants. And so if you cut them, you will actually see that in the budget process. In fact, if it wasn't for some of the immigration growth that we've seen over the last two years, Australia would be would have gone into recession. We can see it because in GDP per capita has been negative for a very long time. So the amount of economic pie that we all get to share, you and I, Sam, are getting smaller and smaller slivers of that pie, but the pie is getting larger because there just are more people in the country demanding goods and services.

And as we touched on a bit earlier, I mean, one of the key fights in this upcoming federal election is, of course, over migration numbers and how high they are. So I just have to ask you whether our politicians are actually ignoring this prediction that they're going to drop and all of the relevant problems that are predicted to come with such a drop.

And as we touched on a bit earlier, I mean, one of the key fights in this upcoming federal election is, of course, over migration numbers and how high they are. So I just have to ask you whether our politicians are actually ignoring this prediction that they're going to drop and all of the relevant problems that are predicted to come with such a drop.

Are you suggesting that politicians only focus on the short term, and not the longer, or even the medium term? I can't believe you'd go down that path, Sam.

Are you suggesting that politicians only focus on the short term, and not the longer, or even the medium term? I can't believe you'd go down that path, Sam.

I would never I would never, Shane. Write.

I would never I would never, Shane. Write.

Can't believe it. And that's the that is the nature of politics and has has ever been thus. But a lot of people, even in the political class, don't understand every element of, say, how visas are playing out, how you get people out of the country, or when people come out of the country. The importance in certain parts of the country of a migrant population being regenerated. The university sector has really copped a lot of criticism from both sides of politics over the last 18 months because for the last ten, 15 years, we'd been told we'd actually restricted a bit of funding to the university sector. They found a way to increase their size and their finances. That was offering a lot of places to full fee paying overseas students. So they had a there was a financial incentive given to them to do it. And now we're upset that they went and did it again. Fancy being focused on the short term? Hard to believe any Australian politician would do that.

Can't believe it. And that's the that is the nature of politics and has has ever been thus. But a lot of people, even in the political class, don't understand every element of, say, how visas are playing out, how you get people out of the country, or when people come out of the country. The importance in certain parts of the country of a migrant population being regenerated. The university sector has really copped a lot of criticism from both sides of politics over the last 18 months because for the last ten, 15 years, we'd been told we'd actually restricted a bit of funding to the university sector. They found a way to increase their size and their finances. That was offering a lot of places to full fee paying overseas students. So they had a there was a financial incentive given to them to do it. And now we're upset that they went and did it again. Fancy being focused on the short term? Hard to believe any Australian politician would do that.

It is hard to believe and just I guess one last follow up, Shane, on that question, is the experts that you spoke to, they said there really is a risk that, you know, if if politicians panic and there's like knee jerk migration cuts, it could be a real problem. Yeah.

It is hard to believe and just I guess one last follow up, Shane, on that question, is the experts that you spoke to, they said there really is a risk that, you know, if if politicians panic and there's like knee jerk migration cuts, it could be a real problem. Yeah.

Well, put it this way. If you're trying to run a small business in suburban Sydney or suburban Melbourne. And you can't get workers. What do you do? Economically you'd say, well, you become much more productive by finding a new way to do stuff. And if I walk the streets of Tokyo, where they have labor shortages, they have gone down this path of, say, trying to get you order your meal, going into a restaurant, a computer effectively does it all, and you've lost the wait staff. That's one way you can do it, but that takes a bit longer, and I'm not sure if Australians are ready to to go down that path, but that is one way. But in another area where you require people to deliver in person service, then that's where you run into that issue. If you've run out of workers. We've tapped, let's say, the the participation rate in Australia, which is the number of people in work or looking at it is at its highest level ever. Because despite all these migrants coming in, our workplaces are still requiring more and more workers.

Well, put it this way. If you're trying to run a small business in suburban Sydney or suburban Melbourne. And you can't get workers. What do you do? Economically you'd say, well, you become much more productive by finding a new way to do stuff. And if I walk the streets of Tokyo, where they have labor shortages, they have gone down this path of, say, trying to get you order your meal, going into a restaurant, a computer effectively does it all, and you've lost the wait staff. That's one way you can do it, but that takes a bit longer, and I'm not sure if Australians are ready to to go down that path, but that is one way. But in another area where you require people to deliver in person service, then that's where you run into that issue. If you've run out of workers. We've tapped, let's say, the the participation rate in Australia, which is the number of people in work or looking at it is at its highest level ever. Because despite all these migrants coming in, our workplaces are still requiring more and more workers.

Well, thank you so much, Shane, for your time.

Well, thank you so much, Shane, for your time.

Thank you for your bit of Canadian homespun insight there, my friend.

Thank you for your bit of Canadian homespun insight there, my friend.

My pleasure. Shane. Today's episode of The Morning Edition was produced by Tammy Mills with technical assistance by Josh towers. Tom McKendrick is our head of audio. The Morning Edition is a production of The Age and The Sydney Morning Herald. To support our journalism, subscribe to us by visiting The Age or smh.com.au. Subscribe and sign up for our Morning Edition newsletter to receive a comprehensive summary of the day's most important news, analysis and insights in your inbox every day. Links are in the show. Notes. I'm Samantha Selinger. Morris. This is the morning edition. Thanks for listening.

My pleasure. Shane. Today's episode of The Morning Edition was produced by Tammy Mills with technical assistance by Josh towers. Tom McKendrick is our head of audio. The Morning Edition is a production of The Age and The Sydney Morning Herald. To support our journalism, subscribe to us by visiting The Age or smh.com.au. Subscribe and sign up for our Morning Edition newsletter to receive a comprehensive summary of the day's most important news, analysis and insights in your inbox every day. Links are in the show. Notes. I'm Samantha Selinger. Morris. This is the morning edition. Thanks for listening.