Australian businesses have a green light to target highly-skilled overseas workers after the Department of Home Affairs made its recently-introduced Global Talent – Employer Sponsored (GTES) visa scheme permanent.

A pilot of the program kicked off on 1 July 2018 to help Australian established and start-up businesses recruit overseas workers for “highly-skilled niche occupations” that they can’t fill in Australia by other means.

Businesses must be able to demonstrate that they haven’t been able to find workers through the Temporary Skills Shortage (TSS) visa program – which was last tweaked in March after replacing the previous 457 visa system long favoured by a tech industry desperate to fill cloud, analytics, artificial intelligence, cyber security and other high-end roles driven by digital transformation.

GTES complements that program by allowing companies to enter into individual agreements, bypassing the TSS short-term and medium to long-term occupation lists to recruit up to 20 highly-skilled visa applicants at salaries over $180,000 for businesses with turnover over $4m.

A formal Start-up Advisory Panel manages applications by start-ups, which are allowed up to 5 highly-skilled visa positions for job roles paying over $53,900.

That helped it earn a thumbs-up from advocacy group StartupAUS, which labelled GTES “solid policy” as CEO Alex McCauley called the scheme “a sign that the government is listening to start-ups and the recommendations we have been putting forward”.

How strong is “strong”?

Kick-off partner Cochlear Limited was joined during the pilot by giants like Rio Tinto, Atlassian, Coles, Yancoal, Pfizer and the Queensland Department of Health – leading David Coleman, Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs, to claim the program “has strong support from industry” as he announced the program’s extension.

GTES has “highlighted the economic benefits of recruiting overseas talent directly to Australian businesses,” he said.

Melanie Perkins, CEO and co-founder of online graphic design firm Canva – a participant in the pilot program – said that “our ability to bring in top talent from overseas will help us to continue to deliver on our huge product roadmap”.

“As a result of skills training and knowledge transfer, we’ve been able to strengthen our people’s skills in technology and innovation, which in the long-run will help create more employment and economic opportunities in Australia.”

Yet Coleman’s characterisation of industry support as “strong” conflicts with reports of low participation in the pilot program: a Hannan Tew Lawyers analysis found that just eight established businesses and zero start-ups had signed up in the first seven months.

By the end of June this year, just five start-ups had joined the program – meaning that GTES only facilitated the creation of between 310 and 385 highly-skilled positions in a bit over a year.

“Apart from an expedited visa processing time… it appears that the GTS pilot needs to implement further benefits to the start-up stream to attract any actual use,” the firm noted.

“Most importantly, the GTS pilot doesn’t remove what we’ve seen as the biggest impediment to start-ups (and any business) bringing in foreign workers – the high cost of the visa.”

Can Australia be globally competitive?

Whatever the enthusiasm from individual businesses, GTES will need to scale rapidly to make up ground lost by skilled migration programs in recent years.

Home Affairs figures confirmed that the 2017-18 year saw a sharp drop in the number of skilled workers allowed into Australia – with just 111,099 Skilled stream places granted by the Department of Home Affairs, down 11 per cent from the 123,567 the year before.

During the same period, the number of residual 457 visas plummeted 26 per cent, from 87,580 in 2016-17 to just 64,470 places in 2017-18.

Those changes have only perpetuated Australia’s ongoing technology skills shortage – exacerbated by a steady decline in the domestic pipeline of additional technical skills.

GTES may provide access to those skills, but companies will need to step up their salaries and perks to lure specialised staff away from lucrative opportunities in other countries.

“A worldwide ‘war for talent’ is being waged, and enterprises that manage their global talent pool well are marching ahead,” the World Economic Forum (WEF) noted in an analysis that linked innovation revenues with the diversity of their workforces.

“The world has benefited enormously from increased global trade and capital mobility. Now, it is time to reap the benefits of talent mobility.”

A recent IMD World Competitiveness Center report ranked Australia as the world’s 14th best country for attracting overseas talent, just behind the US (12) and Singapore (13).

Yet with “middle-income non-OECD countries” like China and India vacuuming up high-skilled labour, the WEF noted, the need to outbid overseas rivals is creating new problems for Australian companies.

Some 62 per cent of CEOs in the latest PwC CEO Survey conceded that lack of key skills was limiting their growth prospects because people costs were rising more than expected.

This was well above the 52 per cent global figure, suggesting that Australian companies either have tighter budgets or aren’t offering as much as competitors – yet need to ramp up their salary offers significantly to remain globally competitive.

“Policymakers have many tools to improve global talent mobility,” the WEF noted, singling out the importance of public-private partnerships as well as businesses, universities, global-governance organisations, multilateral development banks, and civil-society groups.

“The global talent race will continue to accelerate as countries and businesses compete for the best and brightest.”