Are Papua New Guineans stealing Australian jobs at the end of the resource boom?

Written by Colin Filer

Mining in AustraliaViewers of the ABC’s 7.30 Report on the 28th of May this year might have been alarmed by a story that represented half a dozen Papua New Guinean diesel mechanics on 457 visas as a threat to the livelihoods of upstanding white citizens in the coal mining communities of northern New South Wales.  As reporter Matt Peacock put it: ‘What makes it worse for the Gunnedah locals is that while they’ve been sacked, six Papua New Guinean workers brought in on 457 visas have kept their jobs as diesel fitters, doing maintenance on the big coal trucks.’  The Papua New Guineans in question were understandably reluctant to be interviewed, mindful perhaps of Julia Gillard’s complaints about the ‘rorting’ of the 457 visa scheme. As if to explain their reluctance, Matt Peacock thought he had evidence that most of the Australian tradesmen who had been sacked by their employer were solid trade union members with ‘multiple qualifications’, while the Papua New Guineans who kept their jobs had ‘next to none’. It soon began to sound like a story about filthy, foreign, fly-in-fly-out scab labour in the mining industry. Tony Windsor even popped up to link the ‘gutting of regional communities’ with the ‘politics of boat people’

Now we know that Tony Windsor has been much exercised by the social impact of commuter mining and ‘fly-in-fly-out’ forms of employment on rural and regional Australia because he has chaired a parliamentary inquiry into the subject. But where do Papua New Guinean mine workers fit in this scheme of things?

It may come as a surprise to discover how few Papua New Guineans are living and working in Australia – at least to judge by official statistics. According to the 2011 national census, the total number of people living in Australia who have Papua New Guinean mothers and fathers is less than 9000. About 1500 of them are Papua New Guinean women who have migrated to Australia as a result of marriage to men who are not Papua New Guineans. About 2000 are students (or members of their families) who normally return to PNG on the completion of their studies. The available evidence suggests that another 2000 could be mineworkers and members of their families, some of whom may now be Australian citizens, but most of whom have permanent or temporary residence visas.

Evidence from the Department of Immigration and Citizenship appears to confirm that the recent resource boom has created a new opportunity for Papua New Guineans to migrate to Australia – albeit in relatively small numbers. It has certainly created a bigger opportunity than the Pacific Seasonal Worker Scheme previously discussed on this blog. Only 82 PNG citizens entered Australia by this route between the middle of 2010 and the middle of 2012, and all have since gone home. During that same period, 354 PNG citizens arrived on temporary 457 visas, while 764 seem to have acquired permanent residence as a result of their employment, and 366 as a result of their family situation. Out of 327 PNG citizens holding 457 visas in the middle of 2012, almost three quarters (238) had been sponsored by employers in the mining industry.

In 2012, my colleague Ben Imbun at the University of Western Sydney located and interviewed a sample of 39 Papua New Guineans currently employed in the Australian mining industry as part of an AusAID-funded study of the impact of the resource boom on job opportunities in PNG. We cannot tell whether this is a representative sample, but the results are interesting. They had all grown up in PNG, more than 80% had tertiary qualifications, and 50% said they were earning more than A$4000 a fortnight after tax. They were clearly a well-qualified and well-paid group of workers. They had been in their current jobs for an average of 2 years, and all seem to have been employed in the PNG resource sector before migrating to Australia. I actually met one of them on a plane trip from Cairns to Sydney the other day. He is PNG’s most highly qualified petroleum engineer, has an honorary position at the University of New South Wales, and – guess what – he has now taken a job back in PNG on a ‘fly-in-fly-out’ basis while his Papua New Guinean wife and six children remain at his home in Western Sydney.

Australians who complain about ‘their’ jobs being taken by Papua New Guinean immigrants who commute from urban areas to rural and regional project locations should remember that the number of Australians who work in the PNG resource sector on a fly-in-fly-out basis is roughly the same as the number of Papua New Guineans employed in the Australian resource sector, although most of the Papua New Guineans have brought their families to live in Australia. The Australians who work in the PNG sector are generally paid more than twice as much as their local counterparts with the same qualifications, which is why their local counterparts have an incentive to migrate to Australia, where they no longer suffer this form of discrimination. And to judge by the evidence of our sample, the Papua New Guineans now working in the Australian resource sector make a far bigger contribution to development at home, in the form of regular remittances, than the handful of temporary agricultural workers recruited through the Pacific Seasonal Worker Scheme.

If there is one common strand to Australian policy towards PNG since independence, it has been a determination to limit the number of Papua New Guineans coming to Australia. Prime Minister Peter O’Neill complained about this on the occasion of Julia Gillard’s recent visit to PNG. To judge by the official statistics, the policy has been enormously successful. If the resource boom has enabled 2000 Papua New Guineans to breach the walls of the Australian fortress, it is not so much a lamentable brain drain from PNG, let alone a rude attack on the rights of native Australian workers, as evidence that some Papua New Guineans can compete as equals in a global labour market and still contribute to PNG’s national development.

Colin Filer is an anthropologist and Deputy Director, Resources Environment & Development Group, Crawford School.

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Colin Filer

Dr Colin Filer is an Associate Professor at Crawford School of Public Policy. His research interests include the social context, organisation and impact of policies, programs and projects in the mining, petroleum, forestry and conservation sectors.

6 Comments

  • Colin, I believe that you are correct that the wage disparity gives an incentive to work in other countries. I also believe that for every expat in all the various fields, two PNGians should be trained in the expats country of origin. This could be a component of the aid provided by those countries. Steve Day puts it nicely but does not take it far enough “The greatest training tool I ever found was to send them to Australia to work in their trades for a few months. Gave them the opportunity to work with people who were not wantoks, wairas or any of the other tribalists, which I believe are impediments to success that they are constantly attacked by in PNG”. The dreaded wantok system explains why people are more productive out of PNG. The wantok system can equally be a path to riches or more often a slippery slide to mediocrity.

    Tony Flynn

  • Once again the subject of comparative remuneration makes its unwelcome appearance.

    “The Australians who work in the PNG sector are generally paid more than twice as much as their local counterparts with the same qualifications, which is why their local counterparts have an incentive to migrate to Australia, where they no longer suffer this form of discrimination.” Why use “discrimination”?

    Please compare the economies and infrastructure of the two. Infrastructure along the Eastern seaboard of Australia is not comparable to what we suffer under in PNG. Agricultural labour earns K100 per fortnight and this is more than they can earn as farmers on their own soil; such is the state of our agricultural economy. Australia can support high wages in certain sectors, resembling PNG in so far as the mining sector is out of balance with some other parts of the economy. i.e. Ford closing down because they cannot compete with other manufacturers.

    Should PNG pay its engineers and other professionals in the mining sector as they do Australians? The knock on effect would put the rest of us out of business. We are a small country with enormous hurdles to development. The mountains, the swamps, the horrible roads and not last and not the least is our politicians appetite for the good life. Corruption is rife in most countries; our problem is that the proportion of our population in productive work does not enable us to support a level of corruption that would be acceptable in a Western country. Our cake is just not big enough! Our politicians are the ones who are not baking it properly.

    Tony Flynn

    • Yes Tony, I am well aware of the arguments in favour of the dual salary system in PNG. I was once a beneficiary of that system myself, when the public sector version was subsidised by budget support from the Australian government. However, my point was to explain why highly skilled Papua New Guinean workers have an economic incentive to emigrate, and why their emigration might not be such a bad thing for national development in PNG.

  • Thanks for posting this Colin. Dick Bedford from AUT/ Waikato has been digging into the numbers for Solomon Islanders living in Australia. They are, it turns out, tiny, especially once you whittle them down to people of Solomon Islands sole ancestry born in Solomon islands: a total of 494 as at the 2011 census. The total number of Solomon Islands born people in Australia (including children born to Australians in SI and of mixed ethnicity) is nearly 1800, and this is increasing at around 3% a year: less than 60 newcomers total. Meanwhile, the Solomon Islands population increased at around 2.5%, or 12,500 a year. There were similar tiny increases between 2001-2006 censuses.

    By way of comparison, more than 4000 Solomon islanders were involuntarily repatriated in the first decade of the last century, following Australian federation. The Solomons’ diaspora is tiny, and barely functioning, if we compare it to other Pacific situations. I am keen to learn more bout how they are faring in the resources sector: my suspicion is, not as well as the PNG folk.

    Australia, then, is not yet contributing a great deal to the labour mobility situation in that part of Melanesia, though some of us are expecting that will change, if slowly. Brain drain barely enters the picture, either: there are thousands of young people, many qualified, entering the labour market, and mere 10s leaving.

    One last comment: Henry above notes that there might be a future for unskilled PNG workers in aged care. Currently as I understand the 457 visa is obtainable by people with a qualification (usually a certificate) in aged care. The couple I know of are actually self funding in coming to Australia to take the certificate course, and working part time in the industry as they do, hoping for a transition via a 457 offer from their employer. It’s skilled work, I would say: but again, Solomons numbers are tiny. Are they much larger from PNG?

    • Technically, yes the 457 visa allows aged care, the occupation is classified as Regsitered Nurse (aged care). The ABS classify this as a highly skilled occupation, typically requiring a a Bachelor degree or higher and includes registration and licensing.

      However what I was referencing was a lower skilled occupation, probably Health and Welfare Support workers. These require certificates and diplomas as opposed to bachelor degrees. These occupations are currently ineligible for 457s.

      The other barrier that presents are the current salary thresholds, which is $51,400. Often in the lower skilled jobs, this threshold rules out employers hiring lower skilled workers. This threshold is a key component at keeping the 457 program as a highly skilled program. While there are many benefits to this, they do not include encouraging emigration from developing nations such as PNG and the Solomon Islands.

  • Great article Colin.

    This topic goes to the heart of why I believe immigration policies in general should be considered more broadly than they currently are. The 457 visa program may be primarily about the labour market and gaps in skilled migration, but it also goes directly to relationships with other nations and how people movement facilitates different objectives in the 21st century.

    At a recent Senate Enquiry in the 457 visa program (submissions here), a number of organisations raised the example that there are over 800,000 Australians working overseas. By discussing Australian immigration policy in terms of ‘Aussie jobs’, surely we open Australians living and working overseas up to the same treatment? This is perhaps more true for developing nations than developed nations.

    At a higher level, there is substantial evidence to show that highly skilled migration, of which Australia has perhaps a world-leading framework, leads to substantial economic benefits for the host nation. For example, 94 per cent of the rise in labour market participation in the last decade can be attributed to migrants (see Cully here [pdf]). In addition, US and European research shows the fiscal and job creation effect. The amazing thing is that this is still an argument.

    Perhaps what we really should be having a public discussion about is unskilled migration. The global literature on remittances grows everyday yet Australian policy seems unable to integrate immigration into a development context. The Seasonal Worker Program is hardly a success while other forms of unskilled migration, such as aged care, will become very prominent in the future given demographic trends.

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