The high cost of global travel is fueling Australia's worker shortage, the country's trade minister said, with the jobs market the tightest it has been in almost 50 years.
Pre-pandemic, foreign students and young travelers filled a key role in the Australian labor force, working in restaurants and other service-sector jobs, according to the Trade and Tourism Minister.
He said that since the country dismantled its strict border regime, demand for these visas has been high, but would-be workers are being deterred by the high cost.
Farrell said that expensive airfare is an impediment to getting things back to normal. He said that a lack of flights, with airline capacity not yet back to pre-pandemic levels, is also discouraging workers. "We have to address that."
The minister said that companies that relied on these types of employees had received financial support during the Pandemic to stay in business. Farrell said that the cost of airfare from the US to Australia had tripled from pre-pandemic times.
Many airlines were surprised by the sudden increase in travel demand.
A Mastercard Economics Institute study found that flights from Australia were 20% more in April than they were in the previous year, while tickets out of the UK were up by almost a third. In case of a surge in demand, carriers have been hesitant to restore their full fleets. Fuel prices have gone up.
There are a lot of factors behind surging airfare.
As a result of closing its borders during the Pandemic, Australia is increasing its permanent immigration ceiling to allow as many as 35,000 more people into the country every year. Even as the central bank raises interest rates to cool demand and slow inflation, the unemployment rate is expected to fall further.
Farrell said that there are labor shortages in the economy. We can't get enough people to open a restaurant.
Almost 400,000 international students and 250,000 working vacationers were employed in Australia before the border was closed.
It was reported that Australia would welcome thousands more migrants.
Farrell thinks that the airfare squeeze will improve as airlines add more planes, but that it will take some time. Qantas Airways is looking to re-mobilize a number of planes, he said, with many jets owned by the national carrier and other airlines parked in Australia's desert center. The dry climate made it easy to store and maintain.
The lack of flight capacity is one of the reasons why Australia's tourism industry is still lagging. China used to be the biggest source of tourists, but its Covid Zero approach means borders remain effectively shut.
The Covid Zero could last for a long time because it works for the president.
Australia relied on students from China in its education sector.
He doesn't think we'll see a return to top Chinese tourism or education anytime soon. We have to accept the fact that we won't see a return to pre-pandemic levels. We need to increase travel from other parts of the world.
China has created a black hole in the tourism industry.
Farrell was in the US for a meeting with his counterparts from other countries. The initiative, from which India opted out, is an effort by President Joe Biden's administration to deepen ties with Asian nations through a range of issues. US officials have stressed that they aren't asking partners to choose between Washington and Beijing.
With the help of Michael and Ben.
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