Why we don’t have enough employees to fill vacancies (in four charts)

“In terms of these measures, it’s just as bad as we’ve had it since the early 1990s,” Mr Oster said. The Australian Financial Review

He added that the lack of suitable workers has held back production, affecting supply chain resilience and companies’ ability to grow.

Which industries are in urgent need of workers?

The five sectors hardest hit by labor shortages are trade, hospitality and tourism, health care, manufacturing and technology, according to Seek executive director Kendra Banks.

The staff shortages for these five sectors can be divided into two buckets, says Ms Banks.

The first category consists of the hospitality and tourism, manufacturing and trade sectors, which are faced with labor shortages due to a lack of available labor as a result of the pandemic. These sectors currently do not have their usual supply of international students and vacationer visa holders to take on jobs.

“There is a very big gap between what our workforce would look like if we didn’t have COVID and what it looks like today,” said Ms. Banks.

“That affects every sector and some more than others, especially retail and hospitality, where international students and working holidaymakers made up a significant proportion of the workforce.”

The second set of jobs, mainly in healthcare, technology and specialized trade positions, are vacant because those sectors suffer from a structural skills shortage.

Mr Oster says it was already difficult to fill these types of jobs before the pandemic, but it had deteriorated in the past year.

The reasons for the shortages in these sectors are many. In the healthcare sector, the recent immigration freeze, a lack of health professionals seeking to pursue mental health or nursing careers, and people leaving the industry due to burnout have created a structural skills gap.

When it comes to jobs in technology, there is a global shortage of workers with the necessary skills† Markets around the world compete for workers with these skills, so Australia faces a competitive battle to attract that talent.

What is the solution to our skills shortage?

According to Oster, more migration is the most obvious solution to solve the skills shortage in Australia.

But the means to realize this migration are not so simple.

Australia continues to suffer from international travel restrictions for a full year. Net overseas migration – which accounts for people who arrived or left Australia for more than 12 months – was a net outflow of 88,800 people for the 2020-21 fiscal year. That was the largest number of people to leave Australia since World War I.

Student visa holders contributed the most to this dip, with net foreign migration of international students falling from 18,400 in 2019-20 to negative 61,600 in 2020-21. Working holidaymakers experienced the second largest drop, with the number of these visa holders residing in Australia falling by 6,700.

While relatively smaller, the number of temporary skilled and other temporary migrants in Australia has also fallen significantly, with the number of these types of workers in Australia declining by 2305.

Australia’s prolonged arrivals nearly hit net zero in the past quarter, but net overseas migration is not expected to reach pre-pandemic levels for at least another 12 to 18 months, Mr Oster said.

To expedite the overseas arrival of many skilled workers, the Albanian government has urged Home Office to Speed ​​Up Approvals for Qualified Visas

Since March, more than 58,000 applications for skilled visas, including permanent and temporary skilled places, have been submitted to the department. Nearly 25 percent of those applications have already been completed.

However, other visas face delays in processing visas. It takes 30 days to more than 15 months to process an SC482 (Temporary Skills Shortage) visa even if applicants have the required skills and a nomination from a recognized company. The slowest 10 percent of these requests take 15 months to process.

Are companies paying more to attract employees?

With the skills market so tight, attention is now focused on whether companies will pay higher wages to attract staff?, both from Australia and overseas. While NAB predicts some wage growth is likely, there have been limited signs so far.

But many companies will find it difficult to raise wages, with 46 percent of companies increasing their operating expenses in the past month, the latest ABS survey shows. Reasons include high energy and freight costs and a low Australian dollar, making import costs more expensive than usual.

Beyond pay increases, Ms Banks says companies have been looking at alternative avenues to increase workforces in the meantime by hiring people whose qualifications or experience are not recognized by mainstream hiring processes.

Some have approached this route by hiring remote foreign workers to fill the gap† Others have hired refugees with technology experience

“We’ve seen more companies become more open to outside talent from abroad and that could be one way to fill the skills gap in areas like technology,” said Ms. Banks.

She says many of these solutions will have limited reach, as hiring remote workers abroad is not feasible for most healthcare, specialty professions and technical positions.

To address these structural problems and avoid long-term skills shortages, Ms Banks says Australia should expand its targeted migration programs and invest in both short-term vocational training and longer-term education and training.

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