The Australian summer holiday season has brought a chill to the corporate recruitment sector. On December 28, 2025, migration agents and industry bodies confirmed a significant deterioration in service standards for the Skills in Demand visa—the country’s flagship vehicle for bringing in global talent.
Simultaneously, the Federal Government has moved to quell speculation about future intake numbers, confirming that the permanent migration cap will remain frozen at 185,000 places for the 2025–26 program year.
- The Processing “Blowout”: From 2 Weeks to 7 Weeks
The Skills in Demand visa (which replaced the Subclass 482 Temporary Skill Shortage visa) was launched with a promise of speed. The intended service standard was a swift 10–15 days, designed to help businesses fill critical gaps urgently.
However, data released in late December shows a stark departure from that target:
- New Average Wait: Processing times have tripled, jumping from a reliable 16 days to an average of 48 days.
- The “Black Hole”: Applications lodged in early November are largely still pending, creating a backlog that is pushing start dates into February 2026.
Why the sudden delay?
Department insiders point to a “perfect storm” of administrative pressures:
- The “Rush to Beat the Holidays”: A massive surge in applications occurred in late November as companies tried to secure approvals before the Christmas shutdown.
- Increased Integrity Checks: Similar to trends in the UK and USA, Australian officials have quietly ramped up scrutiny on “genuine position” documents to ensure the Skills in Demand visa isn’t being used for roles that could be filled locally.
- Staffing Gaps: The Department of Home Affairs is reportedly operating with reduced processing capacity over the December–January period, exacerbating the bottleneck.
Business Impact: For an Australian mining or tech firm, a 48-day wait is a lifetime. Projects slated to begin in January are now being pushed back, as key engineers and data scientists remain stuck overseas without work rights.
- The 2025–26 Cap: Holding Steady at 185,000
Amid the processing chaos, the government provided one point of certainty: the Permanent Migration Program planning level for the next fiscal year (July 1, 2025 – June 30, 2026) will remain unchanged at 185,000 places.
Breaking Down the Numbers
- Skill Stream (~70%): The bulk of the places (approx. 130,000) will continue to be allocated to skilled migrants. This signals that despite the processing delays, the government’s long-term strategy is still economic migration.
- Family Stream (~30%): The remaining places cover Partner and Parent visas, which continue to face multi-year queues due to the cap constraints.
The “Big Australia” Debate: By keeping the cap at 185,000 rather than cutting it (as some political pressure groups demanded) or expanding it (as business lobbies requested), the government is attempting a “Goldilocks” strategy—stabilizing population growth while ensuring industries have access to labor. However, with the Skills in Demand visa stalling, the pipeline to permanent residency is currently clogged at the entry point.
Strategic Advice for Employers
The “48-day wait” is the new baseline for Q1 2026. Employers must adjust their recruitment timelines immediately.
- File “Decision Ready” Applications: Any missing document (e.g., a police check or English test result) will now result in a Request for Information (RFI), which effectively pauses the clock and sends the application to the back of the queue. Delays for incomplete applications are now hitting 3+ months.
- Utilize Accredited Sponsorship: If your company is eligible for “Accredited Sponsor” status, apply for it. Accredited sponsors are still receiving priority processing, with some approvals coming through in under 20 days despite the wider blowout.
- Reset Candidate Expectations: Warn international hires that they likely will not be moving to Sydney or Melbourne until late February or March.
Conclusion
Australia remains open for business, but the “express lane” has slowed to a crawl. The confirmation of the 185,000 cap provides long-term certainty, but the immediate reality for December and January is one of frustration. For the first time since the new visa system launched, “patience” is a mandatory requirement for the Skills in Demand visa.