Also, the Department of Immigration and Citizenship (DIAC) is warning Immigration Minister Chris Bowen that application processing times need to decrease to avoid possible legal action from skilled migrants awaiting a decision.
DIAC said that immigration needs to at least remain at a level that would lead to an Australian population of 35.9 million by 2050 in order to counteract the effects of an aging population on the workforce.
As word of the departmental briefing was made public under Australian Freedom of Information laws, Reserve Bank director Graham Kraehe said that skilled immigration needed to increase to avoid a wage increase that will cripple Australian businesses.
"I think skills shortages are a major problem and if we don't increase the amount of skilled migration then we are going to have some real pressure on wages," said Kraehe.
Australia has made some progress towards reforming its immigration system. The Australian education sector has been promised easier student immigration. There will also be a reduction in red tape when applying for temporary work visas.
Australia has a points based skilled immigration system which facilitates the skilled foreign worker immigration. In many cases, a job offer from an Australian employer is not required to obtain a permanent residence visa if the applicants has the right combination of age and skills/education.