Urgent action is needed to fix critical capability gaps in the Vocational Education and Training (VET) system to address Australia’s critical skills shortage.
New research by the Powering Skills Organisation (PSO) shows workforce constraints across the VET sector could choke the supply of skilled workers needed for major clean-energy projects and other sections of the workforce.
Known as the VET Blueprint Project (VBP), the research is part of a national initiative designed to strengthen the capacity and capability of the VET sector to meet the growing demand for skills.
The VBP provides a comprehensive overview of the current state of the VET workforce, identifying critical gaps and opportunities to support future workforce requirements.
This includes addressing long-standing shortages across traditional energy trades such as Heating, Ventilation and Air Conditioning (HVAC) which has experienced shortages for over two decades as well as responding to growing demands from sectors such as data centres and digital infrastructure, alongside the broader transition to a clean energy economy.
The project is structured on four interconnected pillars: understanding the workforce; attracting new VET workforce entrants; supporting VET workforce retention; and developing energy capability among the VET workforce.
Key findings include a shrinking and ageing trainer workforce, particularly across electrical, renewables and energy-related trades.
“A shortage of qualified educators is one of the most pressing issues. Addressing entry pathways, professional development, remuneration, and retention is critical for ensuring the sector can grow and innovate,” the report said.
“Training bottlenecks are being driven by limited educator capability in high-growth technologies such as hydrogen, grid battery systems, EV infrastructure and digital energy management.
“There are also slow update cycles for training products causing a mismatch between industry demand the skills VET can currently deliver. Training packages often lag current industry practices and technological change.
“Stronger partnerships between industry and RTOs are essential to modernise content and delivery.
“Weak system intelligence has created data gaps limiting national workforce planning for net zero skill demand.”
A pressing need to upskill the Australian workforce was also made clear in Australia’s AI Opportunities Report 2025, funded by OpenAI and produced in partnership with leading industry bodies such as the Business Council of Australia.
Data centres, clean energy, renewable power, and water-efficient cooling systems have all been identified as future growth engines for the Australian economy.