Coastal businesses fear backpacker visa cap will drive workers away

In short:

Hospitality experts say the backpacker ballot could create significant workforce shortages in holiday towns that rely heavily on seasonal workers.

North Coast Hotel Group director Harry Barry says his business hires backpackers because of a local workforce shortage.

What's next?

Business leaders along the NSW coast are looking to negotiate a federal agreement to help fill roles in the regions.

For publican Harry Barry, backpackers are the lifeblood of his business.

But he says many of his employees are considering returning home after the federal government announced a backpacker ballot, which would effectively cap second-year backpacker visas.

"The incentive was a guarantee they could extend their visas by another 12 months," he said.

"A lot of them are deciding that there is no guarantee that [they're] going to be earning enough money to pay [their] way.

The new backpacker ballot will cap annual places at 45,000 for second-year visas if the standard 88 days of regional work are completed.

Even fewer third-year places are available.

Mr Barry is among a number of business owners concerned about how the cap will impact their staff.

The director of the North Coast Hotel Group runs pubs from Grafton to Taree that employed 80 backpackers over the past two years, with 20 still on his books.

"If we're employing 80 backpackers, we're doing it for a reason, and the reason is we can't find local workers to fill the slots," he said.

According to jobs website Seek, there were more than 130 vacancies in the Coffs Harbour region in the industry on Wednesday.

To fill the gap left by backpackers leaving, Mr Barry is backing a push to establish the region as a priority area for semi-skilled migrants, also known as a Designated Area Migration Agreement (DAMA).

"[A DAMA] would certainly give us another string in our bow if we are going to be out there in a market that's trying to attract these backpackers back to our region,"Mr Barry said.

How does a DAMA work?

The DAMA is an agreement between the federal government and a state or regional authority that assists regional areas to fill roles that would otherwise remain empty.

It allows skilled migrants, in industries of need, to move to the area for work. Industries include skilled roles in hospitality, agriculture, engineering and more.

The agreements are usually in place for five years before they are reviewed.

There are 13 DAMAs in place across Australia, with one operation in New South Wales; two in South Australia; five in Western Australia; one in the Northern Territory; two in Victoria; and two in Queensland.

Regional Development Australia Mid North Coast CEO Madeleine Lawler said the DAMA was not about filling jobs with migrants that could have otherwise employed locals.

"The DAMA requires businesses to be able to substantiate that they have been seeking Australians for a long period of time and have not been able to fill these positions with Australians or people locally," she said.

"This is no open door, this is something that is a strategy for when you have already got yourself a workforce issue."

A similar agreement in Townsville, in Northern Queensland, brought in an additional 480 workers over three years to fill a skills shortage.

A town's lifeline

Holiday hotspot Cairns has held a DAMA for the past seven years.

The agreement, according to the Cairns Chamber of Commerce, was key to keeping the region thriving.

CEO Patricia O'Neill said there was a hotel on Thursday Island, which was included in the Cairns agreement, that would shut down without DAMA workforce.

"Government go to [Thursday Island] regularly; there is only one hotel in the place. If they weren't able to apply to attract a chef, that hotel would need to close [because] it can't feed anyone," Ms O'Neill said.

"That's how critical a DAMA is to certain parts of an economy up here.

"Without having the Far North Queensland DAMA, we would not have a thriving economy; we would not have a workforce to take up jobs."

Each area with an agreement has a list of specific jobs, tailored to the region's needs, that can be filled by overseas workers.

There is already a DAMA in place in the Orana region, which includes Dubbo, and is open to agricultural workers — including berry pickers, chefs and cooks, mechanics, truck drivers, hospitality and retail managers, and waiters.

A spokesperson for Skills, TAFE and Tertiary Education Minister Steve Whan said the NSW government had conducted a feasibility study into state-led DAMAs.

"Consultation with key stakeholders is underway and will inform a proposal to the Department of Home Affairs," they said.