Slashing net overseas migration will provide a population reset to restore Australia’s stagnant living standards. It will boost employment and may increase wages.
Labor and One Nation have different visions of what a migration program would look like.
Pauline Hanson wants to cut the number of temporary migrants in Australia by more than 750,000 over three years by targeting international students and family members of skilled migrants.
There are strong arguments for training our own people and not take them from overseas.
In Australia, migrants are hopping from visa to visa, Many may have spent most of their adult lives here, but who will never make the cut for skilled migration or who wait for years on bridging visas for a permanent visa.
To achieve that reduction, net overseas migration (Nom) would need to turn negative for three years, the party says, before an ongoing cap of 130,000.
That compares with Labor’s target of 225,000.
Hanson blames Australia’s high population growth over the past few years for the economy’s woes. In a social media post, she said “vested interest [sic] are warning Australia could face a technical recession if migration is cut”.
“Australians have been in a per-capita recession for years. Their lives have been getting worse because of migration. Canada has shown living standards improve when migration is cut.”
Canada has long been a type of sister country to Australia – similar size, similar culture, similar economy. And the North American nation is in the midst of a dramatic migration adjustment that has flattened population growth.
Unlike Hanson, Canada’s policymakers have not targeted a specific net overseas migration level. Instead, they have rolled out a suite of policies to reduce the number of temporary migrants as a share of population from a peak of 7.6% in 2024, to 5%.
Canada is about halfway to this goal. The government has reduced temporary arrivals, particularly international students, making it harder to extend stays.
Annual population growth has slowed from 3.1% in early 2024 to just 0.5% now.
In May, the CD Howe Institute, a leading Canadian thinktank, issued a report on the country’s economy in a “lower immigration era”. The title was “resetting expectations”.
Modelling by the report’s authors, Don Drummond and Parisa Mahboubi, estimated that employment in Canada could fall this year and the next.
Real GDP growth in 2026 may be no more than 0.5%, they forecast, and “little more” than 1% on average in the long term.
Falling employment would normally be cause for alarm, but Drummond and Mahboubi say this is actually “what a normally operating labour market delivers, given the demographic shifts underway”.
“These are not signs of a struggling economy,” they said. “Canada’s economy is not broken. It is adjusting. Understanding that adjustment is a precondition for sound policy in the years ahead.”
Nathan Janzen, the assistant chief economist at the Royal Bank of Canada agrees.
“What the population shifts have done has changed how we need to interpret economic data.”
The university sector has been hit particularly hard by the tighter migration rules. The government also provided exceptions to migrants working in areas of particular labour shortages, such as agriculture and the care economy.
But overall, Janzen says, “the Canadian economy has been relatively resilient”.
“If our population estimate numbers are right, we could have negative employment growth and still have falling unemployment. And the per capita economy looks like it’s getting better.”
Canada also began its migration crackdown at a time of high unemployment in the wake of an aggressive series of interest rate hikes by the Bank of Canada.
With the Canadian example in mind, there remain legitimate questions around how we can better manage a temporary migration program that has blown out over the last 20 years.
Australian employers have become too reliant on overseas labour, from chefs to workers in rural areas, and that this has come at the expense of training and hiring locals, even if it means paying higher wages.
“By choosing higher population growth with a high temporary component, we have made it easy for employers to look offshore any time they need to find someone for a job. There are definitely industries that have grown to be reliant on that,” she says.
“That degrades your ability and willingness to train your local workforce.”