Skills Shortages is a Global Problem

Posted on: 21.10.2011    11:32:41

Everywhere you look there are national and international skills gaps that international recruitment agencies are trying to fill. This comes as a surprise too many as we are suffering worldwide with high employment, particularly amongst the 16-24 years age group.

To put it bluntly, most of the developed world has screwed up with the politicians, educators, and us, as citizens and voters, allowing the production of “educated” individuals that very often don’t have the basic “3 R’s” of education reading ‘riting and ‘rthmatic and employers quite understandably shy away from having to train them in the basics that 10+ years of school should have prepared them for. Moreover the failure to stream kids so they emerge from school with useful knowledge required by industry, coupled with the virtual abandonment of the apprenticeship system, means we are now reaping what we have sown and the harvest is very poor.

Corrective action will take a generation so where does that leave the world?

Facing an international skills shortage of unprecedented levels as the world finally emerges from a single or double dip recession and the impact will also be inflationary as cheque books are waved around chasing talent in short supply.

It is a universal problem.

Australia has led the market and had it very much to themselves for a while but still has huge skills shortages especially in the natural resources sector of which mining is the most critical. Innovation through flying in fly out contracts and tin cities of dongas (living accommodation) has failed to ease the market with humble support workers like cooks and cleaners getting A$80,000 a year and skilled trades like diesel fitters upwards of A$110,000 a year it is sucking these skills from within Australia and creating a vacuum that has to be filled from outside. Australia used to use international recruitment agencies to hunt for English speakers to fill the skills shortages but is now being out-gunned in the international markets by demand from elsewhere. With A$400 billion of investment at risk because of labour shortages the scale of the problem is immense. In the perfect world the mining sector alone would like 40,000 extra workers before the end of the year. No chance.

A major failing is getting the job requirements properly broadcast to the market place. CEO’s need to rise to this challenge. Talent management is a main board responsibility and leaving it to bureaucratic HR departments and hoping simply won’t work.

With America having now identified a 600,000 skills shortage with many of the same dynamics as Australia, an ageing population, baby boomers retiring and a lack of trade skills they are likely to be another entrant in the race for talent.

The Middle East is on tick over, but Gaddafi’s death yesterday may well see Libya re-entering the market and competing for skills but are likely to have to pay a war premium to attract applicants.

The world is a very small place these days and applicants will go where the best deal is and where decisions are speedy. This is where the Middle East will out gun Australia and America as the barriers to entry are lower. Readers might think this is all about natural resources but it isn’t take Saudi Arabia for example – laudably it wants to teach English at a younger age and after a US$5.3 billion investment in women only university it is scouring the world for teachers who can teach English as a second language. international recruitment agencies are coming up short – the inevitable response will be to up the packages on offer. How will less well odd countries compete for the same talent?

In Europe there is a merry go round in the chase for talent. Engineers are in short supply. Healthcare professionals are wanted everywhere. The Swiss are nicking German nurses, the Germans look east but most of Polish care workers are already working abroad. The UK’s National Health Service is recruiting in Ireland and so it goes on.

Shortages are going to get a lot worse before they get better and to position your business to obtain the workers you want needs decisive action and linking up with international recruitment agencies that can deliver.


Author – Chris Slay

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