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TRENDS IN NET OVERSEAS MIGRATION: VICTORIA
Population change in each state and territory is the combined result of net overseas migration, natural increase (births minus deaths), and net interstate migration (population change through the movement of people from one state or territory to another). All three components of population change contribute, in varying degrees, to the growth, size and structure of the population in each jurisdiction.
Net overseas migration (NOM) has emerged as a highly topical, and somewhat contentious, issue in recent years, particularly within the context of the Sustainable Population Strategy for Australia and the recent impact of international students on population counts. Variations in the number and characteristics of people arriving and departing the country impact on policy decisions and future planning at all levels of government, and on issues such as skilled and unskilled labour supply; national income from the educational services provided to international students; housing availability; cultural diversity; and social cohesion.
This article presents a brief national view of overseas migration, followed by an analysis for Victoria. It uses the most recent data to examine changing patterns in the characteristics of overseas migrants and their contribution to NOM in Victoria.
The National View
While natural increase has remained relatively stable in recent years, NOM has been far more volatile. The past decade has seen significant fluctuation in immigration estimates due to a number of factors including recent increases in temporary migrants; changing levels of demand for skilled migrants; the relative health of Australia’s economy during the global financial crisis; and improvements in methodology to measure the travel behaviour of temporary migrants more effectively.
In recent years, NOM has accounted for over half of the nation’s population growth. Preliminary NOM estimates for 2010 added 171,100 persons to Australia’s population, representing 54% of the nation’s total population growth for the year, with natural increase accounting for the remaining 46%. In 2010, Australia’s total population grew by 317,100 persons or 1.4%.
In 2010, NOM contributed the greatest number of people to the most populous states: NSW with a net of 51,100 persons, followed by Victoria (48,000) and Queensland (31,600). The NT received the smallest number with 690 persons.
While all states and territories experienced positive NOM in 2010, it was the main component of population growth in SA (76%), NSW (60%), Victoria (57%), and WA (53%).
Fig 1. Population components, Proportion of total growth(a), 2010 (b)(c)
Arrivals and Departures
At the national level, NOM is traditionally positive, with more arrivals than departures contributing to a net increase in Australia's population each year. Over the five years from 2005 to 2010, NOM in Australia increased by 9% (14,300 persons), with arrivals increasing by 19% (68,500 persons) and departures increasing by 26% (54,200 persons).
In 2010, however, NOM declined for the second consecutive year after strong growth for the previous three, with arrivals to Australia dropping by 10% (-46,800 persons) from the previous year and departures increasing by 12% (29,000 persons). The result was an overall decline in NOM of 31%, or 75,800 persons, from the previous year, significantly slowing the five year growth rate.
This decline in net overseas migration to Australia is mainly driven by the temporary visa holders who arrived in earlier years and who are now starting to depart the country in larger numbers. While temporary visa holders, and in particular international students, have been a key driver in the growth of NOM in the three years to 2008, their departures are a major impact on the recent sharp decline in NOM. This reflects recent policy changes restricting eligibility for temporary visa entrants who apply for permanent residency whilst onshore (Australian Productivity Commission 2010, Ch 4, p.21).
Footnote(s): (a)These estimates use the '12-16 month rule' methodology for calculating NOM (b)Estimates for 2010 are preliminary
Overseas Migration and Population Growth
In 2010, net overseas migration remained the main component of population growth in Victoria despite declining for the second consecutive year in line with the national trend. Preliminary NOM estimates for 2010 added 48,000 persons to Victoria’s population, representing 28% of national NOM and 57% of the state’s total population growth (83,700) for the year.
Accounting for the remainder of Victoria’s total population growth in 2010 was natural increase, which added 32,900 persons to the state population, and net interstate migration, which contributed a net 2,900 persons.
Footnote(s): (a) These estimates use the '12/16 month rule' methodology for calculating NOM. (b) Estimates for 2010 are preliminary.
Arrivals and departures
Over the five year period 2005 to 2010, Victoria recorded the second highest growth rate in NOM after the ACT, with an increase of 19% (7,800 persons), compared with 9% at the national level. During this period, arrivals to Victoria increased by 26% (22,500 persons) while departures increased by 33% (14,800 persons).
In 2010, there were 15,800 fewer (-13%) overseas arrivals in Victoria than in the previous year. However, overseas departures continued to increase with 8,200 more (16%) departures than in the previous year. The result was an overall decline in NOM of 33% (-24,000) from 2009, compared with the national decline of 31%.
Overseas Migration Flows
In 2010, Victoria recorded the second largest number of arrivals (nearly 108,000) and departures (almost 60,000) of all the jurisdictions after NSW. Thus, the combined flows of overseas migration (arrivals and departures) was over 167,900.
Footnote(s): (a) Estimates for 2010 are preliminary.
To assess the effect of these gross overseas migration flows, it is useful to consider them as a proportion of the total population. In Victoria, overseas migration had a moderate effect on population turnover, accounting for 3.0% of the total population in 2010, compared with 3.1% for Australia. Of the jurisdictions, Victoria had one of the lowest levels of population turnover from overseas migration after Tasmania and SA.
Footnote(s): (a) Gross overseas flows as a proportion of a state or territory's total population at 31 December 2010. (b) These estimates use the "12/16 month rule" methodology for calculating NOM. (c) Estimates for 2010 are preliminary.
Major traveller groups
In recent years, four major traveller groups have impacted on NOM estimates for Victoria: temporary visa holders; permanent visa holders; New Zealand citizens; and Australian citizens. Other traveller groups, having a smaller impact, include residents returning (i.e. non-Australian citizens who are permanent residents) and people travelling with onshore visas or with visa unknown.
Footnote(s): (a)These estimates use the ‘12/16 month rule’ methodology for calculating NOM. (b)Does not include onshore and other visa types. The visa category information in this table represents the visa at the time of a traveller’s specific movement. It is the specific movement that has been used to calculate NOM.
Over the five years from 2004 to 2009, there was a 75% net increase in the number of temporary visa holders contributing to NOM in Victoria, from 26,300 to 45,900 persons. This was higher than growth at the national level (62%) but below that recorded in the NT (98%), Queensland (93%) and WA (79%). In 2009, the net figure for Victoria decreased 17% (-9,500 persons) from the previous year, slowing the five year growth rate in this jurisdiction.
In comparison, permanent visa holders made a steadily increasing contribution to NOM in Victoria over the five year period, increasing by 25%, from 18,800 to 23,500 persons. This net increase in permanent visa holders was slightly higher than the national increase (23%) but below that recorded in most other jurisdictions except NSW (4%), Queensland (24%) and Tasmania (10%).
For the same period, the net number of New Zealand citizens increased by 19% (720 persons) in Victoria, compared with 14% at the national level. Of the states and territories, Victoria recorded one of the lowest five year growth rates for New Zealand citizens after NSW (-18%) and Queensland (13%).
Traditionally, Australian citizens have a net negative effect on NOM estimates as more Australians depart each year than return. However, the combined effect of an increase in arrivals and a decrease in departures saw the net loss of Australian citizens from the Victorian population change, from -7,400 persons in 2004, to -60 persons in 2009. This change (-99%) was consistent with the national trend.
Major Groupings and Visa Type
The following section provides a further breakdown of the major groupings and visa types that contributed to NOM in Victoria during 2009, the most recent year for which the data are available.
MAJOR GROUPINGS AND VISA TYPE (a), % of Total NOM, States & Territories, 2009
In 2009, temporary visa holders made the largest net contribution to NOM in Victoria, with 64% of the total NOM figure for the year. This was higher than for Australia as a whole (60%), and for most other jurisdictions except NSW (also 64%) and the ACT (68%). The number of temporary visa holders arriving in Victoria during 2009 was 68,500, representing 55% of all arrivals, while the number departing was 22,600, or 44% of all departures. This resulted in 45,900 additional temporary visa holders in the Victoria population.
Temporary visas issued in Australia fall into several categories, the principal ones being International student; Business long stay (457); Visitor and Working holiday visas.
Footnote(s): (a)These estimates use the ‘12/16 month rule’ methodology for calculating NOM.
Over the five year period from 2004 to 2009, there was a 92% (17,500 persons) increase in the net number of international students contributing to NOM in Victoria. This growth in student NOM is mainly attributed to the large disparity between NOM arrivals and NOM departures, which in part reflects the time lag effect of a student’s course duration. The disparity could also reflect the number of students who changed their visa and residency status whilst onshore.
There was a decline (-12%) in student NOM for Victoria in 2009. Despite this decline, international students made up the largest group of temporary visa holders contributing to NOM in Victoria in 2009, adding a net 36,500 to the state’s population, or 51% of the total NOM figure. This was higher than the proportion recorded at the national level (41%) and in each of the other states and territories.
Within this group, international students travelling to Victoria on vocational education and training visas formed the largest component, with a net 16,900 students representing 23% of total NOM in 2009. The higher education sector represented 20% of total NOM in Victoria (14,100 students) while all other student visas accounted for 8% (5,500 students).
Business Long Stay Visas
Between 2004 and 2009, the net number of temporary business visas (otherwise known as 457 visas) contributing to the Victorian population increased by 10%, or 290 persons.
In 2009, people entering with business long stay visas represented one of the smallest groups of temporary visa holders contributing to NOM in Victoria. This visa group added 3,100 persons to the state’s population, accounting for only 4% of the total NOM figure for 2009. This was lower than representation at the national level (6%) and lower than that recorded in each of the other jurisdictions except NSW (2%).
The net number of long-term visitors (staying 12 months or more) contributing to Victoria’s population also increased over the five years, with 1,100 more (23%)visitors in 2009 than in 2004. In 2009, this group contributed 5,600 persons to Victoria’s population, representing 8% of total NOM for the year. This was consistent with representation at the national level (8%) and similar to representation in the other jurisdictions. Of this group, 68% were tourists, 16% were business visitors, 4% were sponsored family visitors, and the remaining 13% were visitors of other types.
Working Holiday Visas
Working holiday makers are permitted to stay for a period of up to 12 months from the date of initial entry. However, many of these visa holders stay more than 12 months, and therefore contribute to NOM estimates. This includes people who have undertaken seasonal work in regional Australia and become eligible to apply for a second working holiday visa, as well as those who have applied for, and been granted, a different visa whilst onshore.
Between 2004 and 2009, the net number of working holiday-makers contributing to NOM in Victoria more than doubled (up by 170% or 2,200 persons). This growth in working holiday visa holders may relate to Australia’s relatively strong economic standing during recent global financial events, increasing the appeal for international travellers to visit and work temporarily in Victoria.
In 2009, working holiday-makers added a net 3,400 to Victoria’s population, representing 5% of total NOM for the year. This was lower than representation at the national level (8%) and below that recorded in NSW (14%), Queensland (9%) and WA (8%).
Permanent visa holders made a much smaller contribution to total NOM in Victoria in 2009 than temporary visa holders (33% and 64% respectively). While this was similar to the proportion of permanent visas at the national level (34%), it was below that recorded in all other jurisdictions except Queensland (23%).
In 2009, the number of permanent visa holders arriving in Victoria was 24,900 persons, representing 20% of all arrivals, while the number departing was 1,400 persons, or 3% of all departures. This resulted in 23,500 permanent visa holders being added to Victoria’s population.
Permanent visas are grouped under three broad categories: Family visas; Skilled visas; and Special eligibility and humanitarian visas.
Footnote(s): (a) These estimates use the ‘12/16 month rule’ methodology for calculating NOM.
For the five years to 2009, Victoria recorded an increase of 34% (2,400) in the net number of family visa holders (granted offshore) contributing to NOM. In 2009, family visa holders made a smaller contribution to Victoria’s population than permanent skilled visa holders (9,400 persons or 13% of the total NOM figure). This proportion was consistent with that at the national level (13%), and similar to that in other jurisdictions except NSW (18%) and NT (19%) which recorded higher levels of representation.
Over the five years to 2009, there was a 30% (2,500) increase in the net number of permanent skilled visa holders (granted offshore) contributing to Victoria’s population, reflecting the increased policy focus on skilled migration since the late 1990s, as well as labour shortages associated with Australia’s relatively strong economy.
However, the economic uncertainty faced by employers during the Global Financial Crisis may have contributed to the sharp decline (-22%) in permanent skilled visa holders in Victoria during 2009. Despite this, people entering with skilled visas made up the largest group of permanent visa holders contributing to NOM in 2009, providing a net gain of 10,900 persons, or 15% of total NOM, for the year. While this was consistent with representation at the national level (15%), it was below that in SA (29%), WA (20%) and the ACT (19%).
Special Eligibility and Humanitarian Visas
Special eligibility visas relate mainly to former citizens and residents requiring special visas to enter the country. This visa category contains very small numbers and has therefore been combined with the Humanitarian visa category, managed by the Australian Department of Immigration and Citizenship. The offshore resettlement component of the Humanitarian Program has two categories: refugees and a special humanitarian program.
In contrast to the other visa groupings, special eligibility and humanitarian visa holders (granted offshore) contributing to NOM in Victoria decreased by 6%, or 220 persons, over the five years from 2004 to 2009. This group made a net contribution of 3,200 persons to the state’s population in 2009, or 4% of total NOM for the year. This was similar to representation at the national level (5%) and in most other states and territories. Only Tasmania recorded a significantly higher proportion in this group of visa holders (14%).
New Zealand citizens
In comparison with temporary and permanent visa entrants, New Zealand citizens made a relatively small contribution to total NOM for Victoria in 2009 (6%). This was similar to their proportional representation at the national level (8%) and in each of the other jurisdictions except Queensland (18%). With 7,700 New Zealand citizens arriving in Victoria in 2009 (6% of all arrivals), and 3,200 departing (6% of all departures), this group contributed 4,500 persons to the state’s population.
Among the major NOM groupings, Australian citizens made the only negative contribution (-0.1%) to net overseas migration in 2009, resulting in a loss of almost 60 persons from Victoria’s population. The number of Australian citizens returning to Victoria in 2009 was just under 18,800 persons, representing 15% of all arrivals to the state, while the number of Australian citizens departing was over 18,800, or 36% of all departures from the state. In comparison, the contribution of Australian citizens to national NOM was also -0.1%, although most states and territories recorded positive contributions from Australian citizens and only Victoria, NSW and the ACT recorded negative contributions.
In Victoria, NOM has been the main driver of population growth in recent years, accounting for over half of the state’s population growth in the five years to 2010.
Underpinning much of the recent growth in NOM, in addition to skilled visas, was a large increase in the number of international students arriving in the state between 2005 and 2008, reflecting Australia’s wider engagement in the global economy and its increasing provision of education services to international students.
This growth in student NOM is particularly attributed to the disparity between NOM arrivals and NOM departures, reflecting time lags in course duration, and the propensity for students to change their visa and residency status whilst onshore. Of the jurisdictions, Victoria was the main recipient of international students in Australia in 2009.
With skilled migration being a key focus of Australia’s immigration policy since the late 1990s, the net contribution of permanent skilled visa holders to Victoria’s population in 2009 was relatively high compared with other visa groups. Of the various visa types, permanent skilled visas ranked second highest (after international students) in terms of their contribution to NOM in Victoria.
The contribution of permanent family visas to NOM in Victoria was also significant, representing the third largest category of total net migration in 2009 and 13% of total NOM for the year (similar to representation in most other states and territories).
Significantly slowing the five year growth rate in total NOM, estimates for 2009 and 2010 show a sharp decline in net overseas migration to Victoria. This was driven by a combination of a decrease in arrivals and an increase in departures for temporary visa and permanent skilled visa holders.
Despite this recent decline, overseas migration has contributed significantly to Victoria’s population growth since 2005, with international students, permanent skilled visa holders and family visa holders making the largest net contributions to the size and structure of the state’s total population.
Australian Demographic Statistics, cat. no. 3101.0, quarterly.
International Students, Net Overseas Migration and Australia’s Population Growth, June 2011, Migration Australia, cat. no. 3412.0, Ch. 6, pp. 55-82.
Migration Australia, cat. no. 3412.0, annual.
Australian Productivity Commission (December 2010), Population and Migration: Understanding the Numbers.
Australian Parliament House (2010), Overseas Students: immigration policy changes 1997 – May 2010.
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