Minimum Income Threshold for Australian Temporary Skilled Migration to $73,150

Effective 1 July 2024, the Australian Government will increase the Temporary Skilled Migration Income Threshold (TSMIT) from $70,000 to $73,150. This change, in line with the Government’s commitment at the Jobs and Skills Summit in September 2022, aims to ensure fair wages for skilled migrants and maintain the integrity of the skilled migration program.

What is TSMIT? The TSMIT sets the minimum salary for skilled migrants, ensuring they are fairly compensated and employed in genuine, high-skilled roles that benefit the Australian economy (News Story).

Who is Affected?

• New Nomination Applications: From 1 July 2024, new applications must meet the new TSMIT of $73,150 or the annual market salary rate, whichever is higher.
• Existing Visa Holders: Current visa holders and nominations lodged before 1 July 2024 will not be affected by this change.

Impact

• For Skilled Migrants: The increase guarantees fairer wages and protects against underpayment.
• For Employers: Especially challenging for small and medium-sized enterprises (SMEs) that may struggle to meet the higher salary requirements.
• For the Economy: Aims to attract highly skilled workers, supporting high-skill industries and maintaining job market integrity.

Is it a Good or Bad News? – Our Analysis

The increase in the Temporary Skilled Migration Income Threshold (TSMIT) to $73,150 can be seen from both positive and negative perspectives, depending on the viewpoint:

Good News:

• • For Skilled Migrants: The increase ensures that skilled migrants are paid a fair wage that reflects their qualifications and contributions. It helps in preventing exploitation and underpayment of temporary skilled workers.
  • For the Australian Economy: By setting a higher income threshold, the government aims to attract genuinely skilled workers who can contribute to the economy in meaningful ways, ensuring that temporary migration supports high-skill industries.
  • For Job Market Integrity: The new threshold helps maintain the integrity of the job market by ensuring that temporary positions are filled by individuals whose skills are in genuine demand, rather than being used to fill lower-wage positions.

Bad News:

• • For Employers: Especially small and medium-sized enterprises (SMEs) might find it challenging to meet the higher salary requirements, making it harder for them to fill essential positions with overseas talent. This could be particularly difficult for industries with tight budgets.
  • For Prospective Migrants: Some skilled workers looking to migrate might find fewer opportunities if employers are unable to meet the new salary threshold. This could limit the options available to talented individuals seeking to work in Australia.

Overall, the impact of this change will vary depending on individual circumstances and perspectives. For skilled migrants and industries relying on high-skill talent, it could be a positive development, ensuring fair wages and robust job market standards. However, for some employers and prospective migrants, the increased threshold might pose challenges.

Future Developments: Additional information on future income thresholds, indexation methodology, and the new Skills in Demand Visa will be provided later in 2024.