The Morrison Government has for the first time released a nationally anchored assessment of Australia’s labour market analysis on occupations through the Skills Priority List.

The list, developed through the National Skills Commission, provides a current labour market rating and a future demand rating for occupations nationally, with current labour market ratings also available at a state and territory level. 

It shows over 150 occupations face current skill shortages nationally, most commonly for Technicians and Trades Workers occupations, followed by Professionals, Machinery Operators and Drivers, Managers, as well as Community and Personal Service Workers.

“The Skills Priority List provides a vital and honest picture of where Australia is at when it comes to skills and it will be used to help steer our ongoing national leadership in securing Australia’s workforce,” Minister for Employment, Workforce, Skills, Small and Family Business, Stuart Robert, said.

“It is encouraging to see more Australians in work today than before the pandemic and while it is clear the economy is facing workforce challenges there are still over one million Australians on a primary welfare payment—we need to help these Australians get into jobs or get into training.”

The Skills Priority List will inform a range of government policy responses, including targeting of apprenticeship incentives, training funding and skilled migration. It is supported and developed by extensive data and analysis including labour market data analysis, employer surveys and stakeholder consultation with representative bodies and federal, state and territory government agencies.

The Skills Priority List can be found here.

The Government’s release of labour market analysis on occupations through the Skills Priority List follows last month’s expansion of the Priority Migration Skilled Occupation List (PMSOL) to include several high-skilled occupations in critically low supply across the industry.

AREEA Chief Executive Steve Knott welcomed the announcement, with many of the 22 new occupations added to the PMSOL, most notably chefs and mining, petroleum and geotechnical engineers, in severe shortage in Australia’s resources and energy industries, threatening to put a handbrake on Australia’s recovery from the COVID-19 pandemic.

Mr Knott said it may well prove to be a turning point in Australia’s skills crisis.

“The next step is for government to urgently formulate a roadmap to both domestic and international reopening,” he said.

“A clear roadmap will provide the business community with certainty and confidence to plan for future investment and employment opportunities.”

Latest ABS data confirm depth of skills shortages

More than a quarter (27 per cent) of Australian businesses are having difficulty finding suitable staff, according to survey results released last week by the Australian Bureau of Statistics (ABS).

ABS Head of Industry Statistics, John Shepherd, said the latest Business Conditions and Sentiments Survey, conducted from 9 to 16 June, showed there were several reasons why employers were struggling to find suitable staff to fill jobs.

“The most frequently reported reason was a lack of applicants (74 per cent), followed by applicants not having the required skills (66 per cent), international border closures (32 per cent) and job location (29 per cent).”

“Businesses reported having difficulty finding suitable hospitality workers, sales staff, engineering and science professionals and drivers. Other in demand jobs included building trades and business professionals,” Mr Shepherd said.

“The survey also found that 19 per cent of businesses reported that, based on current operations, they didn’t have sufficient employees. This is compared to 12% in March 2021 and 15% in December 2020.

The 19% of businesses that had an insufficient number of employees reported on factors that were influencing the number of staff they had. The most common factors reported by these businesses were:

• inability to find suitable staff (57%);
• affordability of additional staff (48%);
• uncertainty due to COVID-19 (42%);
• availability of existing employees to work (34%);
• domestic border closures (19%);
• difficulty retaining staff (19%); and
• international border closures (18%).

Labour shortages to hit manufacturing

Australia’s manufacturing sector has bounced back from sharp declines last year, however its expansion is being hampered by labour shortages not seen in 14 years, the latest industry survey has found.

The latest quarter results from the Australian Chamber-Westpac Survey of Industrial Trends shows that while Australian manufacturing is gathering momentum, there are new constraints to the sector’s potential growth.

“The Labour Market Composite Index strengthened further, with manufacturers continuing to expand their workforce, and expectations for future employment remain positive,”ACCI’s Chief Economist Dr Ross Lambie said.

“However, employers are having increasing difficulties finding experienced workers as a result of domestic and international border closures – these labour constraints are at levels not seen since September 2007.

“Supply chain disruptions were similarly identified as a major impediment to growth in Australia’s manufacturing output, with material constraints on a scale not seen since the 1970’s oil shock.  Manufacturers continue to operate below full capacity, despite growth in new orders and output, as material and labour constraints limit production. They’re finding it increasingly difficult to source some key components of production from international suppliers.

“On the positive side, businesses’ plans to invest in plant and equipment are at the highest levels in five years. Businesses are using the opportunity of record low interest rates and the government support measures, such as the temporary full expensing, to invest in new plant and equipment. Strengthening business investment is the key to improving productivity and increasing competitiveness.”

You can read the full report here.

For more information and/or support on skills-related challenges or clarification around policy, contact [email protected]