Cancelation of the Visa 457 Program

Subject: Strategy
Pages: 7
Words: 2021
Reading time:
8 min
Study level: PhD

A recent announcement by the Australian prime minister Malcolm Turnbull about the cancellation of the visa 457 program has placed many overseas workers in a precarious position (Go Study Australia 2017). The implementation of this reform presupposes the introduction of a new Temporary Skill Shortage (TSS) program and will be completely carried out in March 2018 (Go Study Australia 2017).

The Australian government has notified the current visa holders that they will not be affected by the reform. However, under new regulations, foreign workers who are willing to participate in the temporary labour migration scheme will have to provide a proof of “at least two years’ work experience in their skilled occupation” (DIBP 2017, para. 6). The introduction of the TSS program is also associated with tightening eligibility requirements for new applicants and shortening of occupation lists used by the previous program. Giving the far-reaching implications of the reform, it is important to discuss advantages and disadvantages of the use of the 457 visas.

Pros and Cons

The Australian economy is badly in need of skilled migrant labour that can sustain the growth of such sectors as mining and construction (Bahn, Barratt-Pugh & Yap 2012). The introduction of the Temporary Business Entry Visa or the 457 visa has been the government’s attempt to solve the issue of sourcing skilled labour. The federal government has recognized the problem of the country’s aging workforce and has decided to recruit from overseas. The obvious advantage of the program is the amelioration of a shortfall of skilled workers. It is extremely important, given the prediction that “more people will retire than will join the workforce” (Bahn, Barratt-Pugh & Yap 2012) in the following decade.

From the perspective of employers, it is clear that the 457 visa program is extremely beneficial. A recent survey shows that more than 28 percent of employers in NSW prefer to hire skilled workers from abroad instead of investing in training local workers (Patty 2017). Furthermore, more than 20 percent of the survey participants revealed that their existing workforce does not have time to train new employees (Patty 2017). There is no surprise that business owners have this attitude towards training because increased expenses on the development of social capital might jeopardize the competitiveness of an entity. Therefore, employers and especially small business owners have to be provided with the financial support in attracting, training, and retaining local workers.

Skills shortages have also contributed to boosting the supply of foreign labour to some regions and industries of the country. For example, a shortfall in skills is as high as 52.9 percent in Sydney and 70.6 percent in Western NSW (Patty 2017). It means that the need for the 457 visa program can be framed in terms of broader interests of Australia. However, the temporary migrant scheme divests local workers of job opportunities, which is a substantial disadvantage of the program. The TSS program, on the other hand, includes “more targeted occupation lists which better align with skill needs in the Australian labour market” (DIBP 2017, para. 5). New occupation lists imply a protective element that helps to address genuine skill shortages without diminishing employment opportunities for Australian professionals. It is especially important in the face of the country’s high youth unemployment rates that are approaching crisis levels (Patty 2017).

Another advantage of the program can be best understood from a standpoint of skilled migrants who use work opportunities in Australia for life-changing experiences. Since the introduction of the program in 1996, the mechanism of the provision of temporary skilled labour has often been regarded as the pathway to citizenship (Bahn, Barratt-Pugh & Yap 2012). Access to sponsorship has allowed temporary workers to bring their spouses and children to the country, “with spouses gaining full work rights, and with subsequent applications for permanent residency being unrestricted” (Bahn, Barratt-Pugh & Yap 2012, p. 384).

The abolishment of the program negatively affects professionals from all over the world but especially those who come from India. According to Bennett (2017), Indian workers make up a quarter of temporary visa holders; therefore, the country’s changes in its immigration policy will divest many Indians of work opportunities. India’s Ministry of External Affairs has responded to the reform by hinting at the deterioration of trade negotiations between the two countries.

The government’s decision to scrap the program will most likely “hurt Australian universities’ efforts to attract Indian students” (Bennett 2017, para. 11), which is a substantial downside of the reform. If students think that certain occupations are not on the list, they might opt for a country with less stringent immigration policies. The advantage of the visa 457 program that should not be overlooked is its ability to attract talented tech workers who make a great contribution to the country’s economy.

Ethical Considerations

Australia has a long history of policies aimed at encouraging immigration: without numerous post-World War II immigration waves the country’s population would not exceed 14 million (Hugo 2014). As the result, Australia has come to rely upon foreign skilled labour, particularly mining and construction workers. However, this situation creates work opportunities inequalities that raise some questions about the ethics of Australian employers’ recruitment practices.

The dominant view expressed by individuals criticizing the visa 457 program is that instead of hiring internationally-trained workers, employers should invest in vocational training of local workers (Hugo 2014). The opponents of the program argue that the use of temporary workforce reduces domestic skills training; therefore, employers have an ethical responsibility to facilitate the growth of local skilled workforce.

Another ethical aspect of the issue is that such hiring practices have implications for developing nations. Source countries providing Australia with workers who meet certain performance expectations are at risk of harming the growth of their economies. Therefore, Australian employers who use the program to address labour market shortages should be cognizant of the fact that source countries are often irrevocably damaged by human capital losses. It means that employers should ensure that at least half of their workforce is supplied from local labour pools, in order to have an ethically defensible approach to hiring foreign skilled workers.

Learning Framework

Capability gaps have been named as one of the top five challenges for the corporate world (Nazarudin 2015). Therefore, there is no surprise that corporate training spending has grown precipitously during the recent years. The oil and gas industry in the U.S. receives an influx of 1, 300 graduate petrochemical engineers, which represents a small fraction of the required number of professionals—60, 000 (Nazarudin 2015). It means that energy companies are faced with the challenge to create a comprehensive learning ecosystem for training and retraining engineers (Bersin 2014). High-performing companies that seek for new ways to create seasoned professionals often turn to 70:20:10 workplace learning model.

Structure and Origins

70:20:10 learning framework has been developed at the Center for Creative Leadership based on the works of McCall, Lombardo, and Eichinger who were staunch proponents of alternative modes of training (Kajewski, Madsen & Prime 2013). The model’s name is derived from “the rough percentage allocations of different types of learning in any organization at any time” (Paine 2014, p. 61). 70:20:10 learning framework has also been conceptualized by other scholars such as Tough, Morrison, Homes, and Lindsey. There are many interpretations of the model, but the most popular one states that 70 percent or learning comes from on-the-job experiences, 20 percent from coaching, mentoring, and feedback, and the remaining 10 percent from structured courses and formal training (Paine 2014).

Learning Framework vs. Traditional Training Models

Traditional models of workplace training and learning emphasize a one-size-fits-all approach to employee development. Given the ever-changing nature of the modern business environment, it is important to ensure that learning functions enhance the flexibility of the workforce. Moreover, it is also important to reduce costs and provide workers with access to knowledge on a just-in-time basis, which is not possible with the use of content-based training solutions (70:20:10 Forum n.d.). With the increasing adoption of 70:20:10 learning framework, it becomes clear that adding a learning component to work provides employees with learning opportunities that can help them to build their skills in the context of their work (70:20:10 Forum n.d.).

Unlike traditional models of workplace development, 70:20:10 learning model creates targeted social learning solutions, thereby improving organizational performance. Also, the model builds the scaffolding for effective knowledge transfer, which is necessary for the creation of collaborative development. In addition to providing workers with a framework for developing their skills and capabilities in the real-life environment, 70:20:10 model facilitates the development of tight-knit teams.

It should be mentioned that unlike other models of workplace training, 70:20:10 learning framework goes beyond “equating corporate learning with the delivery of a portfolio of courses” (Paine 2014, p. 63). It means that the success of the model cannot be measured by assessing a learning event. Instead, it is necessary to take a holistic and dynamic approach to evaluating how the training framework translates into the improvement of on-the-job behaviours.

Just like other models, if properly implemented, 70:20:10 learning framework helps to bring a focused type of learning intervention in organizations. However, the substantial advantage of 70:20:10 learning framework over its counterparts is its ability to remain relevant. Traditional training models, on the other hand, suffer from the fast pace of change in the modern business entities that makes it difficult to develop new courses. According to Shepherd, traditional training delivery models adopt a blinkered focus that revolves around handbooks and courses (cited in Scott & Ferguson 2016).

Aligning Learning with Business Strategies

When it comes to aligning learning with business strategies and outcomes, it is clear that 70:20:10 model provides a number of advantages over its traditional counterparts. The shift from considering training an event to regarding it as a continuous and community-based experience allows organizations to create a collaborative culture. This mindset is essential for putting learning initiatives in line with both short-term and long-term business strategies. Given that the objective of workplace development is to add real value to an organization, it can be argued that prioritization of learning through the creation of real-life training experiences helps the management to better understand and calculate the model’s impact on the bottom line.

70:20:10 model can be considered a framework for custom training, which never takes place in isolation in high-performing companies. It has to do with the fact that workforce training and development is often enmeshed with succession plaining and performance management initiatives. It helps to integrate training activities with the wider business strategies and outcomes. Furthermore, custom learning solutions help managers to “use yearly work priorities to support workers’ development” (Nazarudin 2015, p. 8), thereby creating a synergy between training and deliverables. By balancing work delivery and training, 70:20:10 model provides managers with the ability to quickly recognize setbacks. Managers can monitor the progress of their trainees in anticipations of possible mistakes that can be used as learning opportunities.

Organizations willing to align their learning activities with their business strategies and outcomes can start by eliminating duplications of cost and effort. The substantial advantage of the custom learning facilitated by the model is its ability to establish training standards that can be applied across all settings and branches of an organization. By assessing expectations from learning initiatives, it is possible to map fit-for-purpose training operations on broad business strategies. To this end, an organization has to have a common vision and an agreement about direction, which will be picked up by trainees. Furthermore, by allowing employees to learn at their own pace, the model makes sure that learners are more engaged and share their new ideas that can contribute to the improvement of organizational effectiveness.

It has to be borne in mind that while 70:20:10 model offers numerous advantages for aligning learning with business strategies, its implementation can be challenging for managers. It has to do with the fact that they have to contribute much effort to learning ecosystem by supporting trainees. The coaching role carried out by managers pressures them into accepting short-term drops in standards and trading them for a long-term increase in effectiveness of their workers.


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