Like Groundhog day, another report has emerged about wage theft from international students, who have been “unpaid and intimidated” by unscrupulous employers:

An Indian international student claims he was intimidated, exploited and cheated by his employer who threatened to get him deported if he complained to anyone… Sriman Mottala arrived in Melbourne in July 2014 to pursue his Master’s in Business Administration. “Melbourne is an expensive city and international students like me need to work to take care of our expenses. I was on a student visa and was allowed to work 20 hours so I started looking for a job right after I arrived here. “I got a job at a restaurant near my University through a friend’s reference… “I was not paid on time. And I was made to work long hours. I kept working because I needed money. “I was afraid to speak up and my employer took advantage of that. I was polite and did not question him much. “But then when bills started piling up and I really needed money, I gathered the courage and asked him for money. “He came up with this strange offer where he would give us our salary as a loan. The money he gave us was to be returned. Four of my colleagues and I refused and stopped working for him. “We went to the police and complained. The employer instead blamed us in front of the police. “I complained to Fair Work too. The next day, my employer came to my house and threatened and abused me in front of my friends. He claimed he knew many people of influence and would get me deported,” says Sriman… “I was very stressed. I felt very alone. I was new to Australia and everyone I knew here was new to this country too, like me. Nobody knew about working rights or Fair Work. We kept working without being paid because we did not know about our rights. “Also, the employer was an Indian. From the same country. I trusted him. I never knew he would intimidate me and abuse me like this,” Sriman.

International students are ‘ground zero’ for exploitation, usually by other migrants. The chair of the Migrant Workers Taskforce, Alan Fels, explicitly summed-up the problem:

Former consumer watchdog Allan Fels, who is leading the government’s Migrant Workers Taskforce, said he believed one-third of international students were being exploited, with an unpaid wages bill in the billions… [He estimated] up to 145,000 students on working visas are being underpaid by employers… Professor Fels, who led the fight to recover $160 million for 4000 underpaid 7-Eleven franchise workers, said workplace ­exploitation of overseas students was “widespread and systematic”… He said exploitation of inter­national students by businesses owned by migrants from the same ethnic group was a particular problem…

The recent book, entitled The Wage Crisis in Australia, also noted that international students are particularly vulnerable to exploitation because they “see themselves as involved in a project of ‘staggered’ or ‘multi-step’ migration, whereby they hope to leap from their present status into a more long-term visa status, ideally permanent residency”.

The same book found that a quarter of international students were earning $12/hour or less, and 43% of students earned $15/hour or less – well below minimum wage:

“Our research demonstrated that many international students are substantially underpaid at work and exploited by unscrupulous accommodation providers”.

The ACTU’s temporary migration report noted similar concerns:

The relatively recent availability of a large and vulnerable pool of temporary migrant workers has undoubtedly contributed to current record low levels of wages growth and a growing reluctance by employers to train local workers… While there are approximately 1.5 million temporary entrants with work rights, the overseas worker team at the Fair Work Ombudsman consists of only 17 full time inspectors to investigate cases of exploitation – over 80,000 visa workers per inspector. Inadequate enforcement and penalties act as an incentive for employers to exploit temporary workers when the benefit from doing so outweighs the cost of the penalty. or where the probability of being caught is sufficiently low…. There have been a range of abuses uncovered which have clearly shown that the entire system is broken. From 7-11 and Domino’s to agriculture, construction, food processing to Coles, Dominos and Caltex, it is clear that the abuses occur in a number of visa classes whether they be students, working holiday makers or visa workers in skilled occupations.

As has the Grattan Institute:

Australia is now running a predominantly low-skill migration system. People from this system form a material proportion of the younger workforce. Because of visa conditions, many of these migrants have incentives to work for less than minimum wages, and there is anecdotal evidence that many do… It is possible that the scale of this inﬂux to the labour market is depressing wages and increasing under-employment speciﬁcally for low-skill younger workers.

The Department of Home Affairs’ latest temporary visa statistics showed that the total number of temporary visas on issue has ballooned to 2.2 million as at June, up 131,000 over the year and by 537,000 since 2012:

As you can see below, this increase has been driven by international students, whose numbers increased by 66,000 over the past year and by 264,000 since 2012:

It is not just student visas that is facilitating wage theft and destroying wages, but the entire mass immigration model:

students, visa holders, tourists all work for peanuts to gain longer terms visas;

their numbers are endless and so too is the labour supply shock;

and that endless flow has now generated a supply side adjustment to businesses that thrive on cheap foreign labour – basically service economy dross – that holds up empty calorie growth, boosts asset prices and the currency, hollows productivity via capital shallowing, and hollows-out tradables in an era of global lowflation.

Almost all sectors of Australia’s economy have been flooded with cheap foreign competition, thus eroding worker bargaining power, industrial relations standards, and facilitating wage theft.