A new program allowing foreign workers to fill regional skill shortages will boost rather than undercut jobs for Australians, the government insists.
Assistant immigration minister Michaelia Cash says if businesses can't access labour, they can't go on to create more jobs for Australians.
"Targeted skilled migration under DAMA (Designated Area Migration Agreements) guidelines will provide incentives to grow business and local economies for the benefit of Australians," she said in a statement on Friday.
DAMA was launched under the former Labor government, with guidelines now finalised following consultation with state and territory governments, companies and unions, she said.
Starting with areas in the Northern Territory, companies can seek foreign skilled or semi-skilled workers where they haven't been able to recruit Australians in the previous six months.
Senator Cash insists these workers could not be paid less than comparably skilled Australian workers.
Guidelines permit a 10 per cent discount on the minimum $53,900 salary payable to overseas workers on 457 visas. Senator Cash said that still meant DAMA workers would be paid above award rates.
Unions, Labor and others aren't convinced.
Opposition Leader Bill Shorten said priority should be to give jobs to Australians in high unemployment regional areas.
"The government needs to explain why it would exploit underpaid labour .. from overseas in preference to finding jobs for unemployed Australians," he told reporters in Melbourne.
Mr Shorten said Australia sometimes used guest workers to fill skill shortages but the first priority was jobs for Australians.
"There is no place in Australia for exploiting guest workers from overseas to work alongside Australian workers, doing the same work for lower rates of pay," he said.
Queensland independent Bob Katter said this was a slap in the face for Australians desperately seeking work.
"Undermining our pay and conditions is short-sighted and threatens the business sector just as much as the workforce," he said in a statement.
Unions, including the Construction, Forestry, Mining and Energy Union (CFMEU), believe employers would be able to use overseas workers to undercut the local labour market, pushing wages down.
"It will mean less work for young Australians looking for a start in industry at a time when apprenticeship levels in construction and mining are at record lows," CFMEU national secretary Michael O'Connor said in a statement.
Maritime Union of Australia national secretary Paddy Crumlin said unemployment has hit a 12-year high.
"Our government's response? Shunt employment opportunities to foreign workers on reduced wages and grind the boot into the Australians who are left without jobs. It is a complete disgrace," he said.