Massive skills shortage compounded by lack of youth-training programs

by Stephanie Zillman26 Jul 2012

Employers and HR professionals have long since felt the raw end of the skills shortage, and according to a new report it’s only going to get worse.

Regardless of future economic conditions, Australia’s demand for highly skilled professionals will far outweigh supply leaving HR squarely in the lurch. According to a report from the new federal body, the Australian Workforce and Productivity Agency, the skills shortage is being perpetuated by two key failings. Firstly, not enough young people are gaining tertiary qualifications, and secondly, organisations have severely scaled back youth-training programs.

The report, Australia's Skills and Workforce Development Needs, was compiled by looking at four hypothetical scenarios for Australia’s economic future. The scenarios ranged from a prolonged resources boom, to the effects on Australia if the world faces continued political and economic disorder.

Critically it was found that under all proposed future scenarios, post-school qualifications, and especially those at professional level, will mean a shortfall of up to 280,000 by 2025. Put another way, the population with post-school qualifications will need to increase from less than 60% now to between 65 and 75% by 2025. Investment in tertiary education will need to increase by at least 3% a year to meet the demand.

Yet productivity agency CEO Robin Shreeve said it wasn’t only a matter of “cranking out more qualifications”. “It’s also important to think about how firms use their people,” he said. The report said that companies seek fully trained and experienced workers and were not prepared to hire young people and train them. “Today firms no longer play the significant role they once did in training new recruits. Cadetships and internships have been wound back, further reducing opportunities for entry-level work,” the report said.  In striving for efficiency, entry-level positions have been significantly scaled back to the point of firms shooting themselves in the foot.

Commenting on the creation of the new agency, which replaced the former advisory body Skills Australia, the Australian Chamber of Commerce and Industry chief said matching skills to available jobs and increasing workforce participation is a crucial piece of Australia’s productivity future.

The agency is currently seeking feedback on the issues raised in the report, and responses will underpin the next national workforce development strategy, which is due to be published in November. Submissions must be received by August 27.


Top News

What’s hot and what’s not: HR salaries and sought-after skills in 2012
The economy, stupid? Tough times change hiring criteria

Has teamwork and collaboration declined?

Most Discussed

Obese female candidates shown the door
End to
Coles dispute rallies employers against FWA
Witnesses to workplace bullying consider quitting more than the victims


  • by Jeremy Lomman 26/07/2012 2:40:58 PM

    If Australia has a 'massive skills shortage' then where are all the jobs for the work that is not getting done? Does 'skills shortage' refer to the productivity of the existing workforce or not enough bums on seats? I have read a squillion of these articles about the skills shortage occurring in industries that have absolutely no intention of recruiting anyway.

  • by in the wings 26/07/2012 5:40:39 PM

    This story has been doing the rounds since the 1980s. Only the time frame for catastrophic demise changes. Industry is mostly to blame for the predicament they are in. When I started my first tertiary qualification we were wooed with internships. In my first year internships dropped from 500 to 50. In the second year they disappeared all together. When I specialised my employer required me to obtain qualifications that were no longer offered anywhere in Australia. A deal was done between my employer and TAFE to deliver a 2 year course in 2 weeks to a hand full of employees. Everybody was screaming about the skills shortage but other than feeble band aid approaches similar to that supplied by my employer, nothing long term has been done to alleviate the problem. All anyone appears to be interested in is being seen to do something hence yet another report.
    I suggest that organisations stop looking at themselves in isolation and seeing relevant vocational training as an expense and become the movers and shakers of their industry. Yes training can be expensive and yes employees can leave once they have been trained. It needs a special type of employer to allow an employee to leave with your blessing knowing that they will add to the greater good of the industry. An important step that employers don't perform well is keeping in touch with employees with potential. If they feel appreciated and part of a team even when they work for someone else they will consider coming back. They will bring new skills, abilities and knowledge with them. The whole industry can benefit from this bigger picture behaviour. None of us is as good as the sum of us. It is high time we stopped the rhetoric and started fixing the problem.

Most Read