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Melinda Cilento: It’s time to review policy settings to tackle our skills crisis

Melinda CilentoThe West Australian
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Action is needed to tackle our skills crisis.
Camera IconAction is needed to tackle our skills crisis. Credit: coyot/Pixabay

Australia’s skills crisis has been a growing focus and challenge against the backdrop of a labour market that now sees one unemployed person for every vacancy.

Feedback from the business community suggests many jobs are simply no longer being advertised. In practice, the inability to secure the people, skills and experience needed is adversely impacting business investment and growth including in areas of emerging opportunity. As we approach the Federal Government’s Skills & Jobs Summit, one thing all are clear on is that Australia needs policy changes that address immediate challenges and set us up for sustained longer term success and prosperity.

Over recent months CEDA has been engaging with members to gain their insights on these critical issues and immediate and future priorities.

In Perth last week, at one of our member roundtables, one large firm told me that the number of advertised positions or jobs needing to be filled represented 15 per cent of their Australian workforce. This firm is currently waiting on hundreds of visas for the overseas talent it urgently needs.

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The problem is that up to one-third of that global talent is pulling out along the way because of the time and complexity of the process. Whereas Australia’s skilled worker visas are taking months to come through, those with skills wanting to immigrate to Canada are only needing to wait a mere two weeks. The appeal of certainty and speed is obvious.

At the same time, global firms here are reporting that after two years at home, many of their best and brightest workers are keen to pursue roles overseas. The end result of these “net” drivers is far from ideal for Australia.

One obvious fix is to quickly facilitate intra company transfers for trusted multinationals to seamlessly bring global talent to Australia. This is something CEDA has been advocating for some time and which had the support of the Joint Standing Committee on Skilled Migration. It is a no brainer.

While some firms are exploring new options, including work from anywhere approaches, this is not an option for many sectors. The health and aged-care sectors are both facing crippling staff shortages, and in our discussions CEDA members are focussed on how migrants with the necessary skills and experience for these sectors can be prioritised, and how we might make more education and training opportunities available quickly.

As Australia faces a new economic environment, many of the policy settings we’ve had in place must be reviewed.

Long-term thinking and solutions are also needed, noting that CEDA’s recent research revealed aged care staff shortages had doubled in just nine months this year, to total an annual shortfall of 35,000 workers.

Some aged-care providers are considering closing facilities not because demand isn’t there — it clearly is — but that they cannot get the staff needed. Other providers are also reducing their plans to expand and build more facilities, because there is no “quick fix” to this skills crisis.

One provider has also confirmed the sector is experiencing increased rates of casualisation of the workforce. More aged-care workers want increased flexibility. At one provider this has increased to be 65 per cent of its workforce.

For some time CEDA has been advocating for a range of policy initiatives to address Australia’s migration challenges such as the introduction of an essential skills visa to address the aged care worker shortfall.

However, we also need to look at how to encourage more people to enter the workforce who currently face barriers and disincentives. In Western Australia, kindergarten placements are difficult to come by and childcare costs and placements also are a barrier for many women keen to re-enter the workforce. Many older workers are also disincentivised to seek work due to the negative impact on their pension payments.

Another way to increase our workforce in critical areas is by training and education.

However, we also need to address the cap on education and training placements. Universities that train in-demand professions such as nursing, clinical psychologists and engineers currently have student numbers capped by the government. The result is that it is not financially feasible for universities to offer more places. For example, a university receives $17,000 per year to train a nurse in a capped place. If a university were to offer a place outside of the cap, they would only receive $3000 in funding from the government.

These caps were set at a time when unemployment was much higher than it is currently.

As Australia faces a new economic environment, many of the policy settings we’ve had in place must be reviewed. I am hoping that the upcoming Jobs & Skills Summit is the first step in making the critical choices we need.

Melinda Cilento is CEDA chief executive, and will be attending the Jobs & Skills Summit. CEDA will be releasing a Jobs & Skills paper ahead of the event.

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