The Department of Employment has released a bunch of new reports on skills shortages, which reflects research undertaken between July and December 2014 by the Department.
The results, which build on the Skill Shortages Statistical Summary, released in January, significantly undermine the Abbott Government’s sweeping changes to the foreign worker visa program, which will make it much easier for Australian businesses to import foreign workers.
According to the Department of Employment, “employers continued to recruit skilled workers with little difficulty in 2014”, “consistent with the softness in the labour market”. Further, “with the demand for skilled workers relatively subdued over the past few years, and historically high numbers of graduates entering the labour market from both higher education and vocational education and training, long standing shortages across many occupations have been addressed”.
The Department notes that “shortages of skilled workers are limited both geographically and by occupation, and the number of occupations in shortage is low by historical standards”, as shown in the next chart. Moreover, “commentary and data from a number of sources support the view that there are not widespread difficulties recruiting skilled workers”.
Over 2014, “a number of employers noted that they attracted experienced workers for professional vacancies which were for junior or entry level positions. In past years, shortages have been evident for experienced workers despite some surplus of recent graduates, but the labour market is now more readily supplied across skill and experience levels”.
The Department notes that there has been a “steady rise in the availability of skilled workers over recent years and shortages are not currently a feature of the Australian labour market. Employers recruiting for professionals and technicians and trades workers generally have little difficulty attracting applicants who have appropriate qualifications or experience. Significantly, few occupations are in shortage” (see below charts).
There is also little disparity in the ability of employers to recruit skilled workers across locations, although employers in New South Wales have the most difficulty (see below charts).
Importantly, the Department expects the new supply of qualified workers to continue to rise in 2015, with the Department estimating that there will be 25,000 additional undergraduate completions by 2017-18 compared with 2013-14.
What the Department of Employment’s analysis clearly shows, once again, is that the Abbott Government’s decision to liberalise foreign work visas was based on ideology rather than sound evidence.
Its decision has also come at the wrong time, given Australia’s stubbornly high unemployment (particularly youth unemployment), which is likely to worsen as mining investment unwinds, the local car industry closes, and the current housing construction boom-let subsides.
Given such a weak economic environment, whereby demand for labour is low, why on earth should the visa system make it even easier to import labour from offshore rather than training local workers, potentially adding to the pool of under/unemployed and depriving our youth of employment opportunities?
Sure, Australia needs to improve its competitiveness. However, this should be achieved via a process of real exchange rate depreciation, which protects the vulnerable and encourages workforce participation by locals, boosting productivity.
Simply importing labour to keep wages down and to disguise the economic adjustment by maintaining the throttle on population growth (reducing all Australians’ cut of the economic pie in the process) is a short-sighted and cynical policy.
