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Economic Impacts of Migration and Population Growth


  • Productivity Commission


The Productivity Commission release its research report into the ‘Economic Impacts of Migration and Population Growth’ in May 2006. According to the Commission’s findings increasing skilled migration would make a positive, but small, overall contribution to Australia’s future per capita income levels. The report was commissioned by the Australian Government. To assess the effect of skilled migration, the Commission estimated the economic effects of a simulated permanent increase in skilled migration of about 50 per cent on the level in 2004-05, using the Monash model at the Centre of Policy Studies. Positive effects arise from higher participation rates and an up-skilling of the workforce. But some of the economy wide consequences have a negative effect, such as less capital per worker and a decline in the terms of trade. By 2024-25, the net effect is an increase in income per capita, on average, is projected to be about $400 (or about 0.7 per cent), compared with a base case scenario. Most of the gains are likely to accrue to the migrants. The result is consistent with previous Australian studies and others conducted overseas. Recent changes to Australia’s migration program include a greater emphasis on skills, increased numbers of temporary migrants, and more diversification in the country of origin. A greater emphasis on skills has resulted in improved labour market outcomes for migrants. English language proficiency stood out as a key factor determining the ease of settlement and labour market success of migrants to Australia.

Suggested Citation

  • Productivity Commission, 2006. "Economic Impacts of Migration and Population Growth," Research Reports, Productivity Commission, Government of Australia, number 20.
  • Handle: RePEc:ris:prodcs:20 Note: 438 pages

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    References listed on IDEAS

    1. Trinh Le & John Gibson & Les Oxley, 2003. "Cost- and Income-based Measures of Human Capital," Journal of Economic Surveys, Wiley Blackwell, vol. 17(3), pages 271-307, July.
    2. L. Alan Winters & Terrie L. Walmsley & Zhen Kun Wang & Roman Grynberg, 2003. "Liberalising Temporary Movement of Natural Persons: An Agenda for the Development Round," The World Economy, Wiley Blackwell, vol. 26(8), pages 1137-1161, August.
    3. Walker, Greg, 1998. "Economies of Scale in Australian Banks 1978-1990," Australian Economic Papers, Wiley Blackwell, vol. 37(1), pages 71-87, March.
    4. Glenn Withers, 2003. "Core Issues In Immigration Economics And Policy," Economic Papers, The Economic Society of Australia, vol. 22(1), pages 13-23, March.
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    Cited by:

    1. Marcus H. Böhme & Sarah Kups, 2017. "The economic effects of labour immigration in developing countries: A literature review," OECD Development Centre Working Papers 335, OECD Publishing.
    2. Kacey DOUGLAS, 2016. "Raja Junankar, Economics of Immigration: Immigration and the Australian Economy," Journal of Economic and Social Thought, KSP Journals, vol. 3(2), pages 317-320, June.


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