What is the Truth about Australian Skills Shortages?

Posted on: 19.04.2012    12:24:36

On one hand you have international recruitment agencies such as ourselves inundated with varying daily demand for a range of skills from chefs, through to construction, natural resources, especially mining to agriculture and food production. A new but recent demand is all aspects of logistics from all sorts of drivers including pilots and cabin crew.

On the other hand you have experts saying that whilst businesses may be struggling over skills shortages employment conditions are still soft with employers reluctant to hire as international economic turmoil continues to pressure the domestic economy. Certainly the strength of the Aussie dollar is beginning to hurt in international markets.

Can both be true? In a word YES.

These comments come after the release of the Bankwest Skills Shortages survey, which found that two in five Australian businesses are finding it difficult to recruit new staff.

Forty one per cent of the survey’s respondents said it’s taking more than three months longer to recruit staff than it did a year ago.

However, the latest figures from NAB’s business surveys show that employment conditions are still flat. In the bank’s latest monthly business survey, the index for employment rose just one point to one, after remaining at zero during February.

Bankwest economist Allan Langford stated the disconnect between complaints over skills shortages and the actual hiring movements by employers “suggests the two-speed economy is really at hand”.

However, the survey suggests businesses are at least complaining about the ability to find staff. And more businesses are using tactics to find the best workers, with 47% increasing basic pay, and 25% offering additional financial incentives and benefits. Just under 50% are also promoting new conditions, such as flexible working hours. What continues to be missing is treating staff as human beings rather than ciphers. Often spoken about but rarely enacted!

The trend is higher in Western Australia, with 63.4% offering higher salaries to attract staff but pay rates is only part of the picture, marketing openings is the key to success especially in an international environment and we’d be amazed if the current TV adverts from the mining sector made much difference to skills shortages. CEO’s your fishing in the wrong pond!

However, it’s the East Coast that is feeling a lot of the pain, with more than 70% of respondents saying they are currently looking to hire or have hired staff in the last 12 months, and 45% said they had difficulty filling job vacancies during that period. A lot of this caused by the mining sector paying inflationary wages attracting the workers. It’s a vicious circle or perhaps spiral would be a better word.

All of this searching is having a bad impact on business, with 66% of businesses reporting an increase in overtime from existing workers to get all the work done. Employers who push too hard will see their best workers exiting out of the back door.

33% say they are delivering products or services late because of the skills gap, a recipe for long term downturn in business success as innovators overcome the issues even with higher prices.

Langford says it’s clear that based on the differences between states in the results, the multi-speed economy is having an impact on how businesses hire staff.  “Particularly for any businesses that are relying on foreign workers, or in tourism with the higher dollar, that’s having an impact.”

“The two speed economy is alive and well, and you’re getting some indications from the RBA that they’re not dismissing some concerns quite as freely as they had in the past.”

As a supplier of human talent to Australia our main problem is getting employers to engage and consider change. Getting a quality job description out of an Australian employer is a greater challenge than elsewhere around the globe. Ironic really when you think that Australian employers have one of the highest demand needs at present. The broken model of trying to hire internationally through the old fashioned HR approach is a failed approach and it is time to try something new and different.

Australian CEO’s need to take action and experiment with alternative delivery models and bypass their own HR departments but even where this is happening, extracting information from Employers is like trying to get blood from the proverbial stone.


Author: Chris Slay

Skills Provision will allow our articles/quotes to be reproduced on other formats as long as full accreditation is given.