Published 29 October 2026
Recent migrants - those who arrived in the last five years - currently comprise around 6% of the Australian workforce. They have become an increasingly important source of labour for many parts of industry, particularly in fast-growing industrial and care occupations where Australia faces chronic shortages of skilled labour.
This research note focuses on the contribution of recent migrants to the Australian labour market. By examining their labour force participation, occupational distribution, industry representation, educational attainment and migration pathways, the analysis provides insights into how newly arrived migrants are augmenting Australia's labour market.
The analysis draws primarily on data from the Australian Bureau of Statistics (ABS) Labour Statistics microdata, supplemented by migration and population statistics.
Together, these datasets provide a comprehensive view of employment trends, hours worked, occupational outcomes, industry participation and educational attainment among recent migrants, while allowing comparisons with longer-term migrants and Australian-born workers.
The findings show that recent migrants are not only helping to fill immediate labour and skills shortages but are also strengthening the long-term capacity, productivity and resilience of the Australian labour market.
Recent migrants have made strong progress in workforce participation and employment in Australia. Since 2007, their contribution to the labour market has increased substantially, both in terms of employment and hours worked.
In 2007, recent migrants accounted for around 3.5% of total employment. This share has risen steadily over the past two decades, reaching 6.0% by early 2026.Hours worked provide a better measure of recent migrant workforce participation because many migrants initially work in casual, temporary, or part-time jobs. The share of total hours worked by recent migrants has also trended upward, reaching 5.9% in 2026.
There have been three major “shocks” to the contribution of recent migrants over the last twenty years. The first was a temporary boost in migrant numbers during the resource boom of the early 2010s, and the second was a temporary fall during the disruptions of the pandemic.
The third has been a rapid increase in recent migrant contributions since the end of the pandemic, which has risen from around 4.5% to 6.0% of the labour force over the last two years. This infusion of labour supply is equivalent to around 222,000 additional employees relative to if migration rates had stayed constant.
One of the key factors behind migrants’ contribution across the economy is their strong educational profile.
Recent migrants have higher levels of educational attainment than both long-term migrants and the Australian-born population. In 2025, almost 58% of recent migrants held a university qualification, including 18.9% with postgraduate degrees and 38.8% with undergraduate qualifications. By comparison, 50.8% of long-term migrants and 32.9% of Australian-born workers held a university qualification.
The data also suggest that migrants place a strong emphasis on higher education. Even after living in Australia for an extended period, migrants are more likely than Australian-born workers to hold university qualifications. Long-term migrants are particularly well represented at the postgraduate level, with 22.0% holding a postgraduate qualification compared with 18.9% of recent migrants.
This educational advantage helps explain the strong representation of migrants in knowledge-intensive industries and professional occupations. Migrants are heavily represented in sectors such as ICT, engineering, healthcare, and professional services, reflecting the growing role of migration in supplying skilled workers to industries that depend on specialised expertise.
For employers, this provides access to skills that are often difficult to source domestically. In turn, skilled migration supports business growth, investment, innovation, and the adoption of new technologies across the Australian economy.
The growing economic contribution of recent migrants has been underpinned by a significant increase in net overseas migration (NOM) following the pandemic.
After falling sharply during the period of international border restrictions, migration flows rebounded strongly with NOM reaching a record high in 2023. A key feature of this recovery has been the increasing contribution of temporary visa holders. Temporary students, working holiday and skilled temporary migrants accounted for a large share of the post-pandemic migration surge, reflecting strong demand from both educational institutions and employers facing persistent labour shortages.
Since reaching a record high in late 2023, net overseas migration has declined significantly as tighter migration settings and visa reforms that reduced inflows of temporary migrants. By 2025, NOM had fallen by almost half from its peak However, temporary migrant types continue to account for around 80% of all net overseas migration, when visitors and Australia/New Zealand citizens are excluded. Permanent migration numbers have been relatively stable across the last two decades, and account for the remaining 20% of the total.
Despite the changes in policy, permanent skilled migration has remained a major component of Australia's migration program, helping to address longer-term workforce needs. Skilled migration programs support the supply of workers in professional, engineering and ICT occupations, while temporary migration streams make important contributions to hospitality, food services, healthcare support and other service industries.
Recent migrants contribute across a broad range of occupations, with particularly strong representation in labour-intensive service industries. These sectors often have relatively low barriers to entry, making them an important source of employment for newly arrived migrants.
Their contribution is especially evident in hospitality, food services, aged care, and healthcare support occupations, where domestic labour supply has struggled to keep pace with demand. In 2025, recent migrants accounted for 21.0% of food trades workers and 17.2% of cleaners, highlighting their critical role in sustaining essential service industries. Food services and cleaning often provide one of the fastest pathways into employment for new arrivals due to their minimal entry requirements.
Recent migrants also made a significant contribution to hospitality occupations, accounting for 14.5% of workers in 2025. These roles are often attractive to migrants and have historically relied on overseas-born workers. ABS Census data show that around 40% of hospitality workers were born overseas, with both temporary and permanent migrants making substantial contributions to the sector. Migrant workers help address labour shortages by providing the interpersonal and customer service skills required in these roles.
Beyond service occupations, recent migrants continue to make important contributions to technical and professional fields. However, the share of recent migrants employed as ICT professionals declined from 13.6% in 2015 to 9.1% in 2025, representing one of the largest decreases across major occupation groups. This trend is consistent with softer labour demand, with Jobs and Skills Australia reporting that vacancies for ICT professionals fell by 13.1% over the year to May 2026.
At the same time, newly arrived migrants are more represented in a range of technical and operational occupations than they were a decade ago. In 2025, recent migrants accounted for 6.5% of machine and plant operators, 4.8% of automotive trades workers, and 4.6% of numerical clerks, up from 1.8%, 3.2%, and 2.5% respectively in 2015. This suggests that migrant employment has become more diversified across occupations over time.
While migrants continue to contribute significantly to diverse occupations, the share of recent migrants employed as specialist managers, hospitality managers, business professionals, and engineering professionals was lower in 2025 than in 2015. These shifts indicate that labour demand has evolved over time, influencing the occupational distribution of newly arrived migrants across the Australian workforce.
While recent migrants contribute across the economy, they play an outsized role in labour-intensive industries that face persistent workforce shortages.
Accommodation and food services recorded the highest share of recent migrants in 2025, with recent migrants accounting for 14.3% of the workforce, up from 9.7% in 2015. Migrants also play a disproportionately large role in administrative and support services, as well as health care and social assistance.
These industries are often the first point of entry into the Australian labour market for newly arrived migrants and have become increasingly reliant on migrant labour over the past decade. Many of these sectors depend heavily on temporary visa holders, particularly international students and working holiday makers, who are attracted by flexible working arrangements and relatively lower entry barriers. In addition, newly arrived migrants often face challenges in having their overseas qualifications and work experience recognised, leading many to accept jobs below their skill level.
However, the contribution of recent migrants extends beyond these migrant-intensive industries. Migrants also play an important role in sectors that require specialised skills and technical expertise, including construction, manufacturing, and information and communications technology (ICT). In 2025, recent migrants accounted for around 5.0% of the manufacturing workforce and 4.7% of the construction workforce, with both industries recording a gradual increase in migrant participation over the past decade.
Therefore, migration policy has become an increasingly important mechanism for addressing labour shortages across a wide range of sectors. The post-pandemic migration surge helped employers fill workforce gaps at a time of exceptionally strong labour demand. Even as overall migration levels have eased, the continued strength of skilled migration highlights Australia's ongoing reliance on migrants to meet workforce and skills needs.
Jeenat Jabbar is an economist in the Research and Economics team at Australian Industry Group. Her work focuses on delivering robust quantitative analysis across a range of data sources to inform strategic decision-making and policy development.
Dr Jabbar’s research interests include labour market dynamics, migration and wellbeing, with a particular emphasis on the economic contributions of migrants in Australia.
She holds a PhD in Economics from RMIT University, a Master of Business Informatics from Ural Federal University, Russia, and a bachelor’s degree in economics from the Asian University, Bangladesh.
