For 150 years Australian immigration policy has been dominated by economic considerations. The recruitment of labour was a prime consideration of assisted passage schemes, directed as they were towards workers who could otherwise not have afforded the fare. While often resisted by trade unions, selection for skilled occupations was also encouraged: from the building craftsmen of the gold-rush and post-war booms, through the miners of the 1880s, to the computer programmers of the 1990s. These policies have not always worked, most notably in the 1920s when mass British recruitment caused a labour surplus as the world economy collapsed in 1929. But the expectation has always been that a free market in labour could not be relied upon to fill vacancies so far from the main centres of desirable population, and that the Australian state needed to act positively to overcome this problem. In one sense, immigration policy was ‘economically rational’ long before that recent term was invented. But it was rarely ‘free market rationality’ which dominated. The state has usually responded to and assisted labour market pressures.

Economic rationalism in immigration policy

The term ‘economic rationalism’ was developed in Australia by a sociologist, Michael Pusey, in 1991, although occasionally used by others before that. It was meant to be a critical term and was initially rejected by most professional economists.