In a fascinating piece for the Australian entitled Census 2016: Job seekers should wake up and smell the coffee, managing director of The Demographics Group, Bernard Salt, drew attention to a number of trends from the recently released 2016 census that show how the nation’s workforce has changed over the last five years (unfortunately the article is behind a paywall).
Firstly, he comments on the jobs which have grown over the last five years:
“Most growth is delivered in the largest single job category, sales assistant (general), which added 69,100 workers over five years to reach a base of 526,000 workers in 2016. Other big-growth jobs include aged or disabled carer, up 24,100 workers between 2011 and 2016; chef, up 23,100 workers; domestic cleaner, up 20,700 workers; and kitchen hand, up 17,200 workers. These five occupations added 154,000 workers during the past five years, or about 30,000 net extra jobs per year.”
At the other end of the spectrum, he points to those occupations that have contracted over the past five years, most notably secretary (down 19,200 from 2011-2016); checkout operator (down 11,000 from 2011-2016); bank worker (down 9,000 from 2011-2016); manufacturer (down 9,000 from 2011-2016). He also mentioned mixed crop and livestock farmers, which has fallen by 41,000 over the last ten years.
The big picture that emerges from these figures is of a seismic shift in the type of work being done, which means that people are having to adapt and adjust their skillset accordingly. According to Bernard Salt, this includes a shift to:
“… a requirement for more people-related jobs in teaching, building, caring and retailing” as well as “evidence of digital disruption and of globalisation.”
Yet despite these disruptions and the problems they can bring, both to individuals and companies, one fact still stands out above all others: the Australian workforce has continued to grow over the last five years, and this growth looks set to continue for the next few years as well.
But if this is the case, what does it mean in terms of skills supply? The most obvious challenge is of course that of ensuring that there are enough people with the right skills to cope with the expected demands of industry. However, according to Jennifer Westacott, chief executive of Business Council, as things stand the nation is really not in a great position to meet this demand, mainly due to the funding cuts to the Vocational Education and Training system (VET). With the Federal Department of Employment predicting that almost half of the expected 1 million new jobs over the next few years will require a vocational qualification, she sees the approach the Government has taken to VET as being particularly short-sighted:
“We’ll have another skills shortage then we’ll have another debate about bringing in foreign workers, or we will just lose new businesses and new activities to other countries where they have a more trained and skilled workforce. This is urgent. Go and look at other countries, go and look at Germany, go and talk to any senior business person in the United States, particularly the people in the big technology companies, and they’ll say to you it’s the vocational system we should be focusing on now.”
As Ms Westacott rightly points out, unless people are being trained in the skills for the occupations that are fuelling the demand, and indeed being upskilled to cope with new jobs that are being created, then ultimately this will mean frustration for industry and either their stagnation or possible relocation.
But alongside the point about the urgent need for more skills training, there is another huge question that needs to be asked in all this. Rising to the challenge of growth and the changing labour market is not just a question of whether there will be enough training to cope with likely demand, but rather what type of skills need to be taught and in what part of the country they need to be taught. These are hugely important questions, because there is essentially no such thing as “the Australian economy” with a one-size fits all skills need. What is called the Australian economy is really the sum of the parts of all the local and regional economies throughout the country, and all of these parts will have very different skills needs over the coming years.
To take one example, a number of big infrastructure and construction investments have been driving the construction industry over the past few years, and this is inevitably showing up in the trend-based labour market projections shown by our data over the next few years. So if we were to look at one particular occupation within the industry – electricians – what we find in our projections across the nation as a whole is an increase of 8% between 2017-2020. But is this the case for the country as a whole?
The answer to that question can be seen if we delve into our data at more local levels. So in the Northern Territory, for instance, our projections are showing an increase in demand of 10%, whereas in South Australia growth is expected to be around 6%. And the differences are even more marked if we drill down into even more localised geographies. Growth in electricians in Brisbane – West, for example, is expected to be 11%, whilst in Adelaide – Central and Hills it is projected at 3% growth.
This is of course just one example among many that could be cited. But the conclusion we can draw from it is threefold:
- Attempting to solve the skills problem with national skills solutions won’t work, because there are very different levels of demand in different areas of the country.
- Any attempts by skills providers to really meet employers skills needs over the next few years must take into account the realities of demand in their area.
- Localised Labour Market Insight (LMI) can play a crucial part in identifying this demand and therefore in helping skills supply to align with skills demand.
In a growing and rapidly changing labour market, Bernard Salt’s message to job seekers was to “wake up and smell the coffee”. Likewise, in a growing and rapidly changing labour market, skills suppliers need to do the same. Well, with a twist. In this case it’s not coffee, but Labour Market Insight that needs to be woken up to. So come on: Wake up and smell the LMI.
Find out how we can help you identify the skills needs in your area by contacting our Managing Director for Asia Pacific, Anthony Horne