With the 1996 introduction of a new visa making it easier for employers to sponsor skilled foreign workers, temporary skilled migration has become a significant component of international migration flows to Australia. This paper examines employers' reasons for sponsoring skilled workers from abroad, their modes of recruitment, the occupational skills they require, and their industry profile. We also discuss issues relating to the perception of a shortage of skilled workers, the extent that sponsoring foreign workers substitutes for investing in local training, and the role of networks in recruiting overseas workers. Many employers' now have a global view of labour recruitment. While this is understandable for multinational companies with global operations, many small businesses and public sector institutions are adopting the same strategy to obtain skilled labour which they say is in short supply in Australia. With the internationalization of the Australian economy, there is also an increasing demand for people with specialized skills and knowledge that is not available in Australia's relatively small labour market. An understanding of the demand factors motivating temporary skilled migration is crucial to effectively managing Australia's migration and labour trends.