Ms Wilshire urged the prime minister to maintain a long-term view and consider the population size Australia needs to compete on a global scale.

The government has for months been floating the idea of encouraging migrants to settle in regional areas, but is yet to explain how, given all permanent migrants are free to move where they wish.

One idea is a points-based system to fast-track temporary workers who go to smaller cities or regions.

Mary Patetsos, from the Federation of Ethnic Communities' Councils of Australia, says overseas workers already fill key positions in rural and regional areas, as well as in major cities where locals cannot be recruited.

"They are critical to Australia's economy and society: caring for our elderly and disabled, supporting our nation's agricultural sector and growing Australia's IT and high-tech companies," Ms Patetsos told AAP.

"Any policies that encourage migration to the regions need to be transparent and fair and protect migrants from exploitation."

Labor frontbencher Andrew Leigh is not sure how the prime minister's "thought bubble" would work.

"Yes, we need to get our migration mix right, but it's currently true that you get additional points for having studied in a regional area," Dr Leigh said.

"The Department of Home Affairs says you can't compel people to live in particular cities. So, let's wait and see where he's actually going with this."

AAP