Australia’s tight labour market is likely to worsen as the economy strengthens following the COVID-19 pandemic, the Australian Chamber of Commerce and Industry (ACCI) has warned.
Australia’s unemployment rate is at its lowest levels since the 1970s and the Reserve Bank of Australia has warned in its May statement on monetary policy that it could drop to 3.5 per cent by next year.
ACCI chief executive Andrew McKellar said Australia is struggling with a severe skills and labour crisis.
“While we have had skills and labour shortages during previous economic cycles, never have they been as acute, necessitating a range of solutions to respond to this crisis,” McKellar said.
“With the equal lowest unemployment in decades, the highest job vacancy rate since 2008 and the slowest population growth in over a century, the labour constraints faced by businesses will only worsen as the economy strengthens following the COVID-19 pandemic.
“As the recovery continues, we have a once in a generation opportunity to introduce landmark policy reform to help businesses access the skills and labour they need to power the economy forward.”
McKellar said apprentices and trainees are a key part of plugging the skills gap.
“We need to bring into the workforce as many as possible of the 580,000 unemployed and almost one million underemployed,” he said.
“There has never been a better time to tap into this pool of talent including the long-term unemployed, mature aged workers, youth, women and parents, and people with disability.
“In addition, we need to change the settings of our current migration program to increase the cap for skilled migration to 200,000 for the next two years at least.”
Earlier this year the ACCI released a paper entitled Overcoming Australia’s Labour & Skills Shortages through Skills Development, Workforce Participation and Migration.
The paper calls for action in all three areas including skills, participation and migration.
“We need action in all three areas to make Australia the best place in the world to do business so that Australians have the jobs, opportunities and living standards to which they aspire,” McKellar said.