Would slashing net overseas migration “trash the economy” or deliver the necessary population “reset” to restore Australia’s stagnant living standards?
asserted
slashing → slash → standards
Labor and an ascendant One Nation have presented starkly different visions of what a migration program in the national interest looks like.
asserted
program → present → interest
Pauline Hanson, the populist party’s leader, last month announced a plan 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.
asserted
Hanson → announce → migrants
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.
asserted
party → achieve → 130,000
That compares with Labor’s longer-term Nom target of 225,000, and to the last official estimate of 292,000 in the year to March.
asserted
That → compare → March
Tony Burke, the home affairs minister, said One Nation’s plan, if enacted, would “trash Australian services and trash the Australian economy”.
asserted
plan → say → economy
Hanson disagrees, and is quick to blame Australia’s high population growth over the past few years for the economy’s woes.
asserted
Hanson → disagree → woes
In a social media post, she said “vested interest [sic] are warning Australia could face a technical recession if migration is cut”.
“
uncertain
migration → say → recession
Their lives have been getting worse because of migration.
asserted
lives → get → migration
Canada has shown living standards improve when migration is cut.”
asserted
migration → show → ?
For those looking for international comparisons, Canada has long been a type of sister country to Australia – similar size, similar culture, similar economy.
asserted
Canada → look → Australia
And the North American nation is in the midst of a dramatic migration adjustment that has flattened population growth.
asserted
that → flatten → growth
Unlike Hanson, Canada’s policymakers have not targeted a specific net overseas migration level.
asserted
policymakers → target → 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%.
asserted
they → roll → %
The government has done this by reducing temporary arrivals, particularly international students, making it harder to extend stays, and giving some temporary migrants permanency.
asserted
it → do → permanency
Annual population growth has slowed from 3.1% in early 2024 to just 0.5% now.
asserted
growth → slow → %
So how well has Canada’s economy coped?
asserted
economy → cop → ?
And what does their experience tell us about how Australia should respond to growing calls for a more hardline approach to migration?
asserted
Australia → tell → migration
‘Canada’s economy is not broken.
asserted
economy → break → ?
It is adjusting’
asserted
It → adjust → ?
In May, the CD Howe Institute, a leading Canadian thinktank, issued a report on the country’s economy in a “lower immigration era”.
uncertain
Institute → lead → era
The title was “resetting expectations”.
asserted
title → reset → expectations
Modelling by the report’s authors, Don Drummond and Parisa Mahboubi, estimated that employment in Canada could fall this year and the next.
uncertain
employment → estimate → Canada
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.
uncertain
they → forecast → 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”.
asserted
market → fall → shifts
“These are not signs of a struggling economy,” they said.
asserted
they → struggle → economy
“Canada’s economy is not broken.
asserted
economy → break → ?
It is adjusting.
asserted
It → adjust → ?
Understanding that adjustment is a precondition for sound policy in the years ahead.”
asserted
Understanding → understand → years
Nathan Janzen, the assistant chief economist at the Royal Bank of Canada, agrees with this assessment.
“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.
asserted
sector → agree → rules
The government also provided exceptions to migrants working in areas of particular labour shortages, such as agriculture and the care economy.
asserted
government → provide → agriculture
But overall, Janzen says, “the Canadian economy has been relatively resilient”.
asserted
economy → say → ?
“If our population estimate numbers are right, we could have negative employment growth and still have falling unemployment.
uncertain
we → have → unemployment
And the per capita economy looks like it’s getting better.”
asserted
it → look → capita
Canada’s recession and ‘cyclical factors’ at play
But economists warn against assuming Canada’s experience would be replicated here.
asserted
experience → warn → play
Jonathan Kearns, the chief economist at Challenger, says the first point to make is that Canada’s post-pandemic surge was far larger than Australia’s.
asserted
surge → say → Australia
“While people here get excited about our post-Covid immigration, it was nothing compared to theirs,” Kearns says.
asserted
Kearns → get → theirs
Even now, Canada’s population still sits 5% above where it would have been expected to be based on pre-Covid trends.
asserted
it → sit → trends
In comparison, Australia’s population is tracking just 0.2% above its pre-pandemic trend line.
asserted
population → track → line
“So the decline [in Canada’s population growth] has to be taken in context of the massive run-up,” Kearns says.
asserted
Kearns → have → up
…and 17 more, not listed.
The Aporia
