LAST time Australia's airlines turned to other countries to recruit large numbers of pilots, the year was 1989 and they were trying to break an unprecedented strike by their own pilots. But when Jetstar, a low-cost carrier, revealed recently that it was planning to hire more than 75 pilots from Britain, America and South Africa, it was seeking a solution to a problem facing many employers across the country: a severe shortage of skilled labour.

With an economy in its 17th year of uninterrupted growth, Australia's skills shortage has never been worse. People are crying out for plumbers, doctors and nurses. In states that are booming thanks to a mining bonanza—Western Australia, Queensland and South Australia—engineers, surveyors and truck drivers are in short supply. One state-owned water authority complains that it is losing truckers to mining companies offering A$100,000 ($96,000) a year—more than double their previous salary.

In many rich countries where immigration is a politically sensitive matter—America, Britain and Ireland—the number of immigrants seems to be falling as the economy turns down. Not in Australia. The Labor government, under Kevin Rudd, is looking to increase the numbers of foreigners allowed to settle. His predecessor, John Howard, the former conservative leader, had already begun to increase the number, but had to pretend otherwise, since his party claimed to put “Australia first”. Mr Rudd is playing up the increases. On May 13th his government said that Australia would take 190,300 immigrants next year, a rise of 25% on this year. The biggest jump comes in the proportion of those chosen for their skills in a booming economy: at 133,500 they now account for a record 70% of the total intake.

These so-called “permanent” settlers tell only part of the story. With another 100,000 arrivals expected under a short-term visa scheme that allows employers to fill urgent job vacancies from outside Australia, the total intake is likely to be closer to 300,000. Other changes will make still more foreigners available for work. The government is abolishing a restriction enforced by the Howard government that meant illegal immigrants later found to be refugees could get only temporary permission to stay in Australia. And it is thinking about letting in guest workers from Pacific Island nations—a measure used successfully in New Zealand and which Mr Howard sternly opposed.

The latest annual figures are the highest since Australia launched an immigration programme soon after the second world war. They also signal something of a revolution in the way Australia tackles this politically charged issue. Originally, immigration was a way to populate a big, empty country with “ten-pound Poms”, Britons who paid just £10 (then $27) to start a new life down under.

That approach, says Chris Evans, the immigration minister, was designed for a world in which people did not move much. Today, he argues, the country needs a policy fit for a world in which people move often for work. He points out that 500,000 people with “work rights” entered Australia last year: students and holiday-makers, as well as those on work visas. And the country still suffers skilled-labour bottlenecks.

Australia is in some respects paying a price for failing to invest in skills and infrastructure to meet the demands of what the Treasury calls a “once-in-50-years boom”. Not long ago, the sight of a Labor government bowing to demands from bosses and opening the gates to foreign workers would have produced howls of anguish from unions. Not now. With unemployment at a 30-year low, falling union membership and an ageing domestic workforce, the Rudd government can afford to be bold about using immigration as a tool of economic management. Mr Evans says that from now on immigration will play a bigger role in the “structure of Australia's workforce”. He can probably count on Australians tolerating that—so long as the boom continues.