Jim Chalmers, Australia’s Treasurer, has addressed the country’s changing migration landscape, tying it to the broader economic challenges of inflation and consumer spending. In a recent press conference, Chalmers focused on the recent dip in net overseas migration and its potential impact on the economy, while also discussing the importance of carefully managing Australia’s migration policies.
Speaking about the latest migration trends, Chalmers highlighted a notable shift in the numbers. “What we’ve seen in the most recent net overseas migration numbers is that net overseas migration has come off since it peaked in 2023,” Chalmers said. The Treasurer pointed out that while migration numbers have been falling, much of the current pressure on net migration comes from fewer people leaving the country rather than an influx of new arrivals. He emphasized that managing migration is a priority for the government to maintain a balanced economy. “We’ve got a sensible, methodical, considered way to manage net overseas migration down,” he added.
Chalmers acknowledged the vital role that foreign students play in Australia’s economy, but stressed the importance of balancing growth with sustainability. “Our changes to foreign students are all about recognising the huge contribution that education makes to our economy, but making sure that we are managing that growth,” he said. Despite concerns from some quarters that tighter migration controls could affect growth, Chalmers was clear that the government’s current policies are necessary to avoid overstretching resources.
On the broader economic picture, Chalmers admitted that consumer spending has been under pressure. “Consumption is very weak in our economy, and discretionary spending has gone backwards quite substantially,” he explained, linking this to inflation, high interest rates, and global uncertainty. He noted that while migration contributes to economic activity, particularly through international students, it isn’t the sole driver of consumer spending, which remains fragile due to external and internal economic factors.
When asked about the impact of high interest rates on the economy, Chalmers reaffirmed his respect for the independence of the Reserve Bank of Australia (RBA) but noted the tangible effects on growth. “The interest rate rises which are already in the system, combined with some of these other factors, are slowing our economy quite dramatically,” he acknowledged. However, he maintained that inflation has been steadily coming down, with the expectation of further positive trends. “Inflation’s been coming down really quite considerably since its peak a couple of years ago.”
As the country grapples with inflation, Chalmers highlighted the government’s cost-of-living relief measures, which have been designed to ease pressure on households without driving up inflation. These include energy bill relief, cheaper early childhood education, and more affordable medicines. “Our policies are helping, not hurting the fight against inflation,” Chalmers said, pointing out that the government’s focus on budget surpluses has played a role in the fight against rising prices. “The Reserve Bank Governor has said that our surpluses are helping in the fight against inflation.”
On migration’s future role in the economy, Chalmers hinted that the government would continue to be cautious and methodical in its approach, ensuring that it benefits the economy without adding to existing pressures. He stressed that migration policy adjustments, including those affecting students, are part of a broader economic plan designed to keep inflation on a downward trajectory while addressing challenges like housing and consumer spending.
The Treasurer also touched on corporate behaviour, addressing the recent pricing saga involving major supermarket chains Woolworths and Coles. He voiced his concerns about these companies taking advantage of their customers during tough times. “Woolies and Coles shouldn’t be taking their customers for mugs,” Chalmers said, adding that the Australian Competition and Consumer Commission (ACCC) has been empowered to hold supermarkets accountable, and that the government is pushing for a mandatory Grocery Code to ensure fairness for both consumers and farmers.
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