Mark Doran:
… get on with it. We are now talking about the latest ABS stats and job data, and we want you to get involved, 133882. A worrying trend has emerged for job seekers who have now found it more difficult to get a job over the last six months. That’s one spin on the numbers that have come out today, showing almost full employment, I reckon. What are we? 4.3%, the unemployment rate at the moment nationwide, 4.6% here in WA. Saxon Davidson, who’s listening on waiting for me to introduce him, is a research fellow at the Institute of Public Affairs, the IPA. The think tank that, as we discussed recently, is not right-wing despite what some say.
The IPA say they are right in the middle, and I appreciate that, Saxon. I am getting to you. The headline on the IPA’s spin on these figures is this. It’s a good one. The Albanese government’s approach of using mass migration to address Australia’s worker shortage crisis has not only failed, but is surely one of the worst cases of economic vandalism any federal government has presided over. I’m not sure I agree with it, but it’s well written, Saxon. Now, good afternoon to you.
Saxon Davidson:
Good afternoon. Thank you for having me.
Mark Doran:
Pleasure. It’s a different spin on the ABS numbers. You’re putting the blame fairly and squarely on the government.
Saxon Davidson:
Well, it’s more on government inaction than any specific type of action that they’ve taken. What they have spun is that the current increase in immigration that we have seen in the last three years has been justified because of worker shortages, like Australia has undeniably had a worker shortage since the pandemic. We’ve had over 325,000 job vacancies over the last four and a half years straight, and their justification for their migration programme was to address these worker shortages. But it has undeniably failed. I mean, four and a half years straight as I just said, over 325,000. And the government’s not running a skilled migration programme. It would be one thing to justify a migration programme that was skilled, but they’re simply not. In the last financial year, only 23% of new migrants came on skilled visas, which means that there are… And there are other solutions available to the government, to people already here, to allow these job vacancies to be filled and the economy to get running.
Mark Doran:
What are those other options?
Saxon Davidson:
Well, one key barrier to solving Australia’s worker shortage crisis is the fact that we have a bunch of Australians who are essentially locked out of the labour market because of effective marginal tax rates that are simply unacceptable and too high. These Australians specifically are Australian pensioners, veterans, and students on the youth allowance. Our pensioners and veterans face an effective marginal tax rate of 66% should they earn over $226 per week. And our students on the youth allowance face an effective marginal tax rate of 76% should they earn over $288 a week. And there is no reason to work as you’re being taxed at a rate of 66 or 76%.
What we have repeatedly asked the government is to adopt the New Zealand pension model where pensioners who choose to work pay tax on their combined pension income at a tax rate as low as 10.5%. And their pension is not reduced to simply working. This is why quarter of pensioners work in New Zealand compared to 3% here in Australia. And what our research has shown is that if we were to adopt the New Zealand pension model and apply it to our veterans, our pensioners, and our students, we could see an extra 520,000 extra workers enter the labour force.
Mark Doran:
Okay, I like it. But why is it, Saxon, that we at different times, depending on what we’re talking about here on 6PR is a great example. If we open up the lines and someone might want to call in right now, 133882, who has a job on offer, a decent job, a decent paying job on decent terms and all the rest that can’t get a quality applicant. When we’ve got… What are these numbers today? There are 326,700, this is nationwide, 326,700 unfilled positions. And that’s just come down a little from the last time this was measured three months ago. Yet there are people out there that say, “I’ve got a job. I can’t find anyone to take it.”
Saxon Davidson:
Well, that’s a wide-ranging economic question and also an education question. Quite frankly, there are fewer people taking up trades than there were. For example, when you’re talking about construction or manufacturing, and there are far more people in the university or in the services sector, for example. And this is where we can have a discussion on skilled migration, where we can actually bring in people who are qualified for these roles. But unfortunately-
Mark Doran:
But we are doing that now. We are bringing in skilled migrants, Saxon.
Saxon Davidson:
No, but not at the rate that’s required. And also, I mean, 23% of, in a record migration time of people on the skilled visas. And when we’re talking about housing, which is a huge problem at the moment, particularly in WA, in the 2024 financial year, only 3.6% of the people in the temporary skills’ shortage visas programme who were granted those visas had key home building skills. We are simply not bringing in the people that actually have the skills that we require for the economic and financial pressures that we’re experiencing at the moment. It would take wide-ranging economic problems to address. And part of that is actually just allowing people who want to work, but are locked out to work, as well as addressing some of the education problems that can be addressed in order to get more people and silo, more people into areas of economic need.
Mark Doran:
We’re talking to the Saxon Davidson the research fellow at the IPA on the back of the latest job seekers data. We talked about the unfilled position. Separate Australian Bureau of Statistics data shows us there are 666,000 Australians who are unemployed, and as we said, 326,000 unfilled positions, so what’s the IPA’s position on full employment? Is it about 4%? Because there will always be people who don’t want to work.
Saxon Davidson:
Oh, sure. Absolutely, but our solutions to this sort of looks beyond the unemployment rate. We’re actually trying to address people who aren’t in the participation rate in the economy. We want to reach people who are neither employed nor unemployed, and this is where the people who are being locked out of employment. You’re not going to look for work if you’re facing a 66% tax rate, so we want to cut that tax, allow people the option, the economic incentive to be allowed to enter the workforce if they so choose to, and increase the participation rate because if you have a low unemployment rate, obviously that’s less people looking for the jobs that are available. We actually want to increase the amount of people into the labour market, increase the participation rate so that we can fill these job vacancies.
Mark Doran:
I like it. I like it. As usual, the IPA with plenty of food for thought. Thank you, Saxon, for your time this afternoon.
Saxon Davidson:
Thank you for having me.
Mark Doran:
Appreciate it.
This transcript with Saxon Davidson talking on Perth Live – 6PR from 14 January 2026 has been edited for clarity.
