Working holidaymakers continue strong contribution to net migration

A surge in working holidaymakers has increased challenges for the Albanese Government to curb net migration numbers, writes Dr Abul Rizvi.

AFTER HITTING a low of 19,324 at end December 2021, the number of working holidaymakers in Australia has steadily climbed to 170,437 at end December 2023 (see Chart 1).

That increase will have contributed to record net migration in 2022-23 and will limit how quickly the Government can reduce net migration as many of these visa holders may extend stay in Australia given the strong labour market. They may also seek to apply for other temporary or permanent visas onshore.

The working holidaymaker program consists of two visa types: the standard working holidaymaker (WHM) visa subclass 417, which is managed on a demand-driven basis and the work and holiday (W&H) visa subclass 462, which is largely managed with a visa cap for each participating country (other than the USA). There is an agreement on these visas with each participating country with reciprocal arrangements for young Australians to work and holiday in the reciprocating country.

At end December 2023, there were 136,502 WHM visa holders in Australia, of whom 31,018 were UK nationals. Another 33,935 were W&H visa holders, of whom 2,960 were from the U.S. and 2,974 from China.

In the six months to December 2023, a total of 122,388 WHM/W&H visas were granted, compared with 111,610 in the six months to December 2022. This indicates that WHM/W&H visa grants are continuing to make a strong contribution to net migration.

Record temporary entrants set new challenges for net migration

A surge in temporary entrants over the Christmas period has given the Government new challenges in tempering net migration numbers.

The Government has indicated it will issue a discussion paper on WHM/W&H visas in 2024.

While it may wish to reduce the contribution of WHM/W&H visas to net migration, this will be limited by two main factors:

WHM/W&H visas are based on reciprocal agreements with a large range of countries. It would take time to renegotiate these. Some of the changes to these agreements were relatively recent. For example, the Morrison Government negotiated with the UK for WHM visas for UK nationals to be for up to three years and increased the age limit to 35, while the Albanese Government has recently announced an agreement with India that may use the W&H visa.
A range of industries are heavily reliant on WHM/W&H visas (such as agriculture and tourism). These industries would strongly resist any tightening of WHM/W&H visa policy and would be supported in that resistance by the National Party in particular.

The Albanese Government may simply have to accept that WHM/W&H visas will continue to make a substantial contribution to net migration and the strategy to reduce net migration will need to continue to focus elsewhere.

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Dr Abul Rizvi is an Independent Australia columnist and a former Deputy Secretary of the Department of Immigration. You can follow Abul on Twitter @RizviAbul.