Papua New Guinea Joins Australia’s Pacific Labor Scheme

Workers from Papua New Guinea (PNG) will soon potentially be able to gain greater access to the Australian labor market, with the country being the latest Pacific Island state to sign on to Australia’s Pacific Labor Scheme. At a meeting on the sidelines of the High Level Dialogue on Indo-Pacific Cooperation held in Jakarta in mid-March, Australian Foreign Minister Marise Payne signed a Memorandum of Understanding with her PNG counterpart, Rimbink Pato, including PNG in the program. PNG now joins Kiribati, Nauru, Samoa, Solomon Islands, Tonga, Tuvalu, and Vanuatu as countries participating in the scheme.

The Pacific Labor Scheme (PLS) allows people from these countries to work in low-skilled or semi-skilled jobs in rural and regional Australia for up to three years. This mainly includes industries such as hospitality and tourism, aged and disability care, as well as agriculture, forestry, and fishing. The PLS was launched in July last year and comes off the back of Australia’s Seasonal Worker Program (SWP), which allowed workers from Pacific Island countries (and Timor-Leste) to work for up to six months in Australia’s agricultural sector.

The expansion of both the industries available to work in and the time period that workers will have in the country are the result of a number of factors. A primary driver is the ongoing labor shortage in rural and regional Australia. This shortage is now recognized as affecting more than the agricultural sector, leading to the expansion of employment options available under the PLS. This reality has converged with Australia’s recent “Pacific step-up” brought about by increased competition by China for influence in the south Pacific. Labor market access is an area of influence China cannot easily compete with.

Greater labor market access is something Pacific Island countries have long requested from Australia. For the average Pacific Islander, even the temporary work provided by the SWP is able to deliver a fourfold increase to their annual earnings. This labor market access is recognized as the most effective, and least paternalistic, development strategy for the region, not just providing an increase in personal earnings, but generating significant remittances as well as allowing visa holders to develop valuable skills and return to their communities.

Expanding the program to PNG has the potential to significantly increase these positive outcomes. At 8.3 million people, PNG is by far the largest Pacific Island country, and remains one with stubbornly high levels of poverty. Over a third of the PNG population earns below $1.90 a day, according to the latest World Bank figures. Subsistence agriculture remains the dominant economic activity in the country, which prevents starvation due to the country’s extraordinary fertility, but doesn’t offer the opportunity to expand people’s resources and opportunities.

Yet there remain a number of hurdles that people from PNG face in order to take advantage of the opportunities presented by the PLS. In recent years Australia’s rural and regional industries have relied on the labor of backpackers from European or East Asian countries to fill their shortages. While this form of labor is often only short term and unreliable, their presence in the country allows employers the ability to meet and vet potential workers in a normal hiring process. This is not an option available under the PLS, where employers are required to apply for a “Temporary Activities Sponsorship” approval by the Department of Home Affairs, and then utilize a cumbersome and impersonal international recruitment process. The extra bureaucracy and unknown nature of the process makes employers wary of hiring large groups of anonymous workers, and prevents Pacific Islanders from being able to promote themselves in face-to-face meetings. Despite the extended timeframe of a three-year visa – which employers welcome – it remains incredibly difficult for Pacific Islanders to compete with the more streamlined nature of backpacker labor.

Where Pacific Island workers have been successful, as in the case of workers from Vanuatu and Tonga, there has been a process of trust-building over several years of renewed short-term work, building up relationships and networks that allow both employers and workers to approach the mechanisms of recruitment in a more intimate fashion. In this regard PNG’s admission into the PLS may not bear immediate fruit, but will hopefully offer the opportunity for enough pioneering participants to start building these relationships and networks that will allow the scheme to work as intended.