Australian startup founders are still facing significant visa issues, with industry figures claiming the new visa options revealed in the wake of the 457 visa abolition aren’t giving founder sufficient access to international talent.
The Federal Government effectively put visa issues to bed earlier this year with the unveiling of a new ‘Global Talent Scheme’ visa and the 457-replacement Temporary Skill Shortage (TSS) visa.
The new visas were heralded as a “game-changer” for the startup scene, but months down the line attitudes have grown cold after political turmoil in Canberra has effectively halted progress, leaving startup founders with limited access to global talent.
The Global Talent Scheme visa promised to create a specific ‘stream’ just for startups, which would allow them to hire for five positions each year via the visa, with a pathway to permanent residency given after three years. There were a number of concessions stapled to the visa, however, with startups needing to be ‘verified’ by an independent panel prior to using the visa class.
Hopes were high for the new visa stream, however, speaking to StartupSmart, StartupAus chief executive Alex McCauley says the Global Talent Scheme visa is well and truly on the backburner, failing to miss its target for a pilot launch on July 1. McCauley sits on the advisory and independent panel for the Global Talent Scheme visa.
“Unfortunately it’s been quite slow coming in. The pilot was meant to start on July 1, but there have been no visas issued under the scheme yet,” he says.
“Part of the reasons for that is the shifting around on a political level in Canberra, but in the meantime, startups have been applying for the regular TSS visa, which just looks a lot like the 457 visa.”
TSS visa worse than the 457
Comparing the TSS visa to the 457 visa is even too generous according to some founders. The TSS visa has been criticised as being too restrictive to startups looking to hire internationally, with Jo Burston, founder of labour hire and migration consulting firm Job Capital telling StartupSmart the TSS visa is far from a holistic solution for businesses.
The renowned business owner and startup scene advocate says her experience working closely with businesses looking to hire international talent has laid bare the faults of the TSS visa, namely the significant processing times and high costs. Additionally, Burston says many founders just “don’t know what to do” when it comes to the incredibly complex Australian visa space.
For a short-term TSS visa, the cost of sponsoring an applicant starts at $1,175, and for a medium-term visa they start at $2,455. Additionally, businesses now must pay a bevy of fees and levies, including a $2,000 to $7,000 levy depending on the business’ turnover, and a requirement to dedicate 1-2% of its payroll to an industry training fund.
Burston says these costs are an “instant barrier” for smaller businesses and young startups who were hoping to employ overseas workers, saying the spendings can compound quickly if businesses want to employ multiple international workers.
She also criticised the labour market testing required of companies as part of the TSS visa, which requires businesses to undertake four months of job-searching prior to hiring an international worker for the role.
“This hinders any company looking to get a worker into Australia really quickly, especially those who need someone with very specific skills to run a certain project,” she says.
“A lot of companies have shied away from the process which has led to them not having the expertise they need, simply because they didn’t want to put themselves through six months of dealing with Home Affairs.”
While McCauley agrees on the slowness of the TSS visas, he thinks the costs are mostly a non-issue for startups, who he says will be employing workers on significant salaries in the first place.
However, although the startup advocate says it’s better to have the TSS visa rather than be in “limbo” like the community was last year, he says the TSS visa is nowhere near as good as the 457 visa in isolation.
“The government wanted to make it harder for businesses to get visas, and that’s what they’ve done,” he says.
But once the Global Talent Scheme is up and running, McCauley says startups will have a solid visa option, even despite Australia’s “slow-moving immigration apparatus”.
Further changes unlikely
If startups are still hopeful for sweeping policy changes on visas, Burston warns founders might be waiting for a while, saying the 457 visa class was abolished by the government to keep it off the political agenda and the topic is too “politically safe” for either party to foray into.
“I can’t see anything changing any time soon without some major lobbying. It’s not going to happen,” she says.
McCauley mostly agrees, saying while “anything’s possible” he doubts any major changes to the visa will happen in the near future but says some changes on the edges could be made.
He’s hopeful to see some progress soon on getting the TSS visas finalised and established, saying they just need to be “signed off” on by the government.
“We need to get things moving, but stuff takes time in government, and even more time if there are political issues in Canberra,” he says.