Australia facing a post COVID-19 Skills Shortage ( And Unskilled)

 In early June, Australian Prime Minister Scott Morrison said he wanted to overhaul the skills workforce to ensure a better post-COVID recovery. The issue with this is that there may not be enough people with the necessary skills to do so. Australia often relies on skilled migrants for many of the infrastructure-related jobs, and now the travel ban has affected migration, and there is a distinct shortage of skilled workers. 

The problem starts in Australia where an interim report was released in early June. The report found that the proportion of people without qualifications at certificate level 3 or above had decreased from 47.1%(2009) to 37.5%(2019). The report also found that while the number of higher-level qualifications increased between 2009 and 2012, it has unfortunately fallen again. 

COVID-19 has had a devastating effect on the world in 2020, with issues stemming anywhere from economical to emotional. Australia has had its share of COVID-19 related problems. April 2020 saw the greatest loss of jobs in living memory of Australia. Up to 600,000 people became unemployed, according to the figures of the Australian Bureau of Statistics. A further 250,000 jobs are predicted to be lost from now until Christmas, peaking at 11% total unemployment. Such a high level of unemployment has already halted the economic growth of Australia. Compounding the problem, there’s been a disruption of supply chains, and the restriction of movement are major factors behind the estimated budget deficit of 180 billion. The economy is on the verge of nosediving into a recession, with the GDP shrinking by 7%. In the past, when Australia has experienced recessions, there have been two main phases that apply to the current situation:

  1. Job creation programmes to tide over the sectors and demographics hardest hit by the pandemic
  2. Training people and boosting growth industries  that will provide the sustainable jobs of the future 

In the past, Australia has successfully used these “interim job creation projects” to pull Australia out of a recession. Both the Sydney harbour bridge in the 1930s and the Snowy Mountain Scheme in the post-war period were interim-job creation projects. They were designed to boost low-skilled employment after economic hardship and ensured Australian workers did not have damaged future employment prospects. Paying workers whose careers have been disrupted by COVID-19 ensures money continues to circulate throughout the economy and supports small businesses. It also averts mental health issues by providing routine and direction to the masses in this uncertain time. These jobs have created essential and productivity-enhancing infrastructure before, but have limited life spans and are only temporary solutions. Additionally, they are also typically focused on male employment sectors such as construction, leaving the female workforce to struggle on their own.

Who are the most affected?

Right now, it is women and youth that are most affected. Many people between the ages of 15-24 work part-time and casual jobs in the hospitality, arts, and retail sectors, sectors that were the hardest hit by the pandemic.  Global markets research firm CoreData Research5 found that even though the job losses have been more significant for women, men have lost more income. This is probably due to more women working in part-time jobs than men. 

It is also possible that older workers may be forced to retire early. This is because many companies are using the time of COVID-19 to restructure and update technology-wise. It is unlikely employers will re-employ older workers because of the changes in working style.

Apprentices and trainees are also amongst the most affected. Many have been laid off due to not enough work in corona times, and the expected number of apprentices and trainees in the two years is set to drop by 30%. The Mitchell Institutes education fellow, Pete Hurley, says trainees and apprentices are the most affected because business are reluctant to take on 3 to 4-year placements. This means that we could see youth dropping out of the training system and workforce and will lead to even more skill shortages down the track. 

 What Jobs  have been hit the hardest by the COVID-19 pandemic and where is employment stimulus needed?

Accommodation, food services, retails, arts and recreation are the sectors that experienced the largest number of job losses, primarily in Sydney and Melbourne. However, while these sectors are the most heavily impacted, the National Skills C omission also predicts that these sectors will be the fastest to recover, with the population eager to dine out and travel.

In May 2020, a report from the National Skills Commission hypothesised that healthcare, social assistance and construction companies would all be hiring more staff, as they would need to increase their workforces for the upcoming creation of new projects post-COVID.

 What Happens Now?

There is a need for longer-term, sustainable jobs in specific industries. When Jobseeker ends, Australia will need to support the firms that can rapidly increase employment. Some sectors have already progressed amid the pandemic, and therefore are the best candidates to advance after. 

They include the digital and ICT industry, Health and aged care, and the reusable products and renewable energy sectors. Right now, there aren’t enough people in Australia trained for these sectors to progress quickly, and this is where the skill shortage comes into play. Usually, Australia would have skilled migrants coming in to support this shortage, but that isn’t possible right now. 

So instead, Australians will need to be educated.  

Each industry should be responsible for educating new workers.  A survey by ING bank found that at least one in three Australian workers were looking for new careers in the post-pandemic world, and roughly 23% were unsure if they had the right skills for the workforce of the future. Education will be the most critical factor of these growth sectors and will provide a supercritical role in providing skilled workers for the future.

 To help , Universities,TAFE’s and school’s could invest more of their budget into the promotion of vocational courses and degrees that would help to  create a generation of skilled workers. This would help Australia to become self-sufficient and better prepared for future economic crises.