Australia's skills gap has been receiving a significant amount of coverage, and research indicates that three in four Australian CEOs are concerned about a looming shortage in key occupations and skills. The conversation about the national skills gap encompasses a few different dimensions. First, technological change and automation will likely drive a digital skills gap. Second, skills gaps are affecting cities and regions in a different way. Third, employers, industry groups, and other stakeholders are planning to tackle the issue in a range of ways.
Where's the skills gap?
The skills gap affects a range of occupations. Digital and technology-oriented occupations like engineering, ICT, and science technicians have, unsurprisingly, been identified as among those facing a shortage. Electrotechnology and telecommunication trades workers are also occupations affected by shortages in regional areas.
However, there is also a shortage of technicians and certain tradespeople. These include automotive and engineering trades workers, and construction trades workers. Beyond these, occupations like architects, surveyors, health professionals and construction engineers are also experiencing shortfalls. The National Skills Needs List has a full list of trades professions with a supply deficit.
White collar occupations are also affected by Australia's skills gap. According to the Skills Shortage List Australia by the Department of Jobs and Small Business, shortages or recruitment difficulties are affecting professional occupations such as those of architects, surveyors, civil engineering professionals, and veterinarians. The solicitor occupation is also currently impacted by recruitment difficulties, as are health occupations like sonographer, optometrist, audiologist, physiotherapist, midwife, and pharmacist. Different shortages might exist for individual states and territories as well as regional areas, and this might account for the additional occupations on the lists for eligible skilled occupations for migration. For example, the lists includes extra (to the Skills Shortage List Australia) white-collar occupations like aeroplane pilots, aeronautical engineers, accountants, barristers, cardiologists, dentists, and registered nurses.
Technological change and automation as drivers
Technological change and automation are some of the things causing our skills gap. Research suggests automation could replace one in six jobs in Australia by 2030, and some observers predict it's on target to take away an average of four hours of work each week. While technological implementation will lead to new business models that allow staff to produce more value, the balance of skills and work will likely be shifting, and the extra value will likely require upskilling to achieve. So, transitioning workers, perhaps through better in-work training, and ensuring future workers have the right skills could be the key, and companies play a vital role in this shift, though government policy could also play a significant supporting role. Companies may be embracing this role by recognising that technological implementation could lead to new business models that allow staff to produce more value. A majority (54%) of Australian CEOs see it as their responsibility to retain employees whose tasks are displaced by automation. At the same time, 74% of employees think upskilling is their responsibility. Research, however, suggests leaving it to employees could be less efficient than businesses taking charge to reskill.
Businesses seeking to get ahead of the technology-driven skills shortage would do well to embrace the trend and understand how it will impact their organisation. Assess what will be lost and gained, and focus on the customer. Audits could help identify key areas for reskilling and a variety of training options could be used, from microskilling to external training.
Businesses should note the skills gap may impact more than just digital skills. Soft skills like problem solving, leadership, and emotional intelligence will likely be as important as digital skills. As Bianca Pickett, Head of Head of People & Culture at Kiandra IT, states, "Being able to communicate effectively, to build rapport, to understand what a client really wants, and deliver to that, is far more important nowadays, and in our experience, rare."
The bottom line is to have a clear plan as technology and automation disrupts your skills requirements, and ability to fulfil these changing skills needs.
Cities vs regional areas
Skills gaps are impacting Australian businesses differently depending on their location. Growth in high-skilled jobs, for example, is concentrated in the nation's biggest cities. In rural and regional areas, gaps in lower-skilled roles are growing fastest.
Everthought does all training face-to-face, and this ensures all students have the support and knowledge to progress through their chosen course. In addition, we also offer flexible training delivery through Workplace Training where we visit students in their workplace and train them in the current work environment. We work with industry to ensure that our training is relevant and up-to-date with modern industry practices and standards. This is evidenced by the fact that we train people onsite in their workplaces, which ensures all trainers are exposed to what is occurring in workplaces.
Presently there are skills shortages in traditional trade areas in Australia. This places vocational providers in a unique position to provide training with a real focus on outcomes through tried-and-tested training methodologies.
Recently, there has been a major shift from traditional classroom-based training to a mix of online and blended training options. This has started to reach into the trades training space with several vocational providers offering a flexible delivery mode or 100% online delivery method. This has in turn, had an adverse effect on completion rates with many people not receiving the support they require to complete courses. This lack of completions is having an impact on supplying qualified workers to industry and widening the skills shortage gaps.
Additionally, existing workers that may have the skills and years of industry experience are often overlooked for positions as they don’t hold a formal qualification.
This has led to a shift in thinking about how we qualify people that have the experience, skills, and knowledge and haven’t gone through a traditional apprenticeship. Recognition of Prior Learning (RPL) is a method that is being used in the vocational sector to evaluate a person’s experience, skills, and knowledge against the formal qualification framework. RPL assists in formally qualifying skilled people and ultimately satisfying shortage gaps in the workforce. By providing flexible and new ways to obtain qualifications, we can start to bridge the gap in developing skilled workers through non-traditional methods whilst maintaining high completion rates.
As the General Manager of Everthought Education, I am seeing firsthand the benefit of RPL and other innovative methods to upskill and train the workforce. I believe that a healthy balance of new and existing training methodologies is paramount for developing a skilled workforce and attracting new workers into the trades space.
The skills gap is too often short-sighted. The skills gap is commonly referred to as the disconnect between the skills the current workforce has as compared with the jobs currently required.
We take a different approach at DDLS: whilst the skills gap of today is of paramount importance, we focus on what is coming. What are the skills we need to be trained in today for the jobs of tomorrow?
"A report released from Bersin by Deloitte states that 47% of today’s jobs will be entirely redefined in 20 years and even more alarming is that 65% of today’s students will do jobs that don’t yet exist. DDLS focuses on ensuring it is offering training in the latest technologies and provides options for the current skills gap, but more importantly, also focussing on the jobs of tomorrow."
We work closely with our vendors, industry, and students to ensure we have the latest training courses on offer. A recent survey of DDLS customers received more than 5,000 respondents with 50% of them identifying the need for cloud technology training due to the business going through digital transformation and migrating all technologies to the cloud within the next 12 months. We aim to address the skills gap by focussing on role-based learning and aligned experience.
The key is no longer offering certification for certification’s sake, but rather, identifying role requirements, and ensuring training is linked to role outcomes. All DDLS courses are internationally recognised certifications, and this is key in addressing the skills gap which is becoming increasingly borderless. With the ability to deliver training remotely and looking to expand its offerings offshore, the identification of the skills deficiencies in countries outside Australia allows DDLS to ensure its course offerings are not just Australian-focussed. Businesses are increasingly utilising offshore staffing solutions to meet the demand of their local goods and service requirements―it is therefore important for any Australian-based training company to ensure it is reviewing the skills gap globally.
DDLS is Australia’s leading, trusted training partner offering learning solutions across IT, process management, and professional development. DDLS designs, develops, and delivers innovative learning solutions from certification through to customised learning programs to enable clients to confidently deploy technology and effectively manage processes and people for their business growth and success. With national training facilities in Sydney, Melbourne, Brisbane, Perth, Adelaide, and Canberra, DDLS provides the highest quality learning programs, Technical Instructors, Trainers, and Facilitators to train over 15,000 students a year. Students are trained from beginner to specialist and advanced levels, fully transforming their effectiveness.
*Jon is an accomplished leader with a strong passion for education and a drive for building successful and sustainable businesses. Jon brings to DDLS an extensive career in the education sector and will support the DDLS team to drive toward an innovative and successful future.
The nature of work in Australia is changing. Regardless of what we call it―the Future of Work, Industry 4.0, or the Fourth Industrial Revolution―we need to respond for Australia to remain strong, competitive, and productive.
This period of rapid change, driven by advances in new technology, is irresistible, and while our education and training sectors have been gearing up for it, I don’t think we’re responding quickly enough.
Technologies like artificial intelligence, robotics, 3D-printing, and autonomous vehicles present huge opportunities. We will only seize these opportunities if our education and training systems are more responsive to change, delivering the skills that business and industry will rely upon and ensure future generations of graduates and workers can grasp new and emerging opportunities.
As Assistant Minister for Vocational Education and Skills, I have a keen focus on restoring VET’s status as a training system of choicena centre of excellence where people can get real skills for real careers.
Having the VET sector better integrated with our university sector, combining their complementary strengths, is critically important as we deliver the skilled workers that business needs.
The Australian Government, through the Australian Industry Skills Committee, created the Digital Transformation Industry Reference Committee, ensuring the training sector responds to greater automation and digitalisation of work by adopting future-focussed skills.
Our Pathways in Technology (P-TECH) pilot, to operate at 14 sites around Australia, will help to meet the emerging demands for new and varied skills.
P-TECH offers secondary school students an industry-supported education pathway to a STEM related post-school qualification. Students have the option to continue their study at the tertiary level or pursue employment in a STEM-related field, including with the school’s industry partners.
These steps will help future-proof the national training system.
Aside from the technical skills to grapple with emerging technology in the workplace, our education system, be that schools, university, or VET, must also instil and nurture fundamental skills such as critical thinking, creativity, teamwork, and lifelong learning.
The workforce Australia needs to face the changing nature of work involves more than just the knowhow to operate new technology, it requires resilience to weather the change, and initiative to turn a challenge into an opportunity.
Digital technology has been steadily infiltrating Australian schools over the past decade, but a curriculum change to support this new technology has been, in my opinion, long overdue. Subjects such as computer science, coding, and data science have as of 2018 been added to the new digital technologies curriculum in a bid to reverse the current downward trend of PISA Scores recorded in Mathematics and Science by Australian students. But is this enough? After all, NSW―one of the most populated states in Australia―has not even set a date for when they will be making the subjects mandatory in schools. But I have been asked the question: what does this change mean for the future for educational institutions?
"With the new digital technologies curriculum, I believe schools need to ensure that the relevant teachers are being provided with the resources, support, and the time needed to learn and engage with these subjects. This is essential to ensure that teachers are equipped to educate their classes to the best of their ability, and thus prepare today’s students adequately for a technology-based future."
Population growth, the rise in birth-rates, and the ever-growing need for good quality child care has been driving the demand for more qualified early childhood workers the country over. According to the Department for Employment, there are currently over 120, 000 workers in the childcare industry, most of which are employed full-time, while many others work flexible hours. This is expected to rise by over 20,000 workers, meaning there is a strong growth in this sector.
As the Director of the Training College of Australia, an RTO that specialises in Cert III and Diploma Courses in Early Childhood Education and Care, I have been aware of the gap in skills in the industry for some time. And it is one that not only needs fixing, but deserves ongoing training and development of existing workers. After all, we are talking about the people that are leading our future leaders through the early learning stages of their life.
While the industry has largely been dominated by women, we are seeing more and more men entering childcare and early childhood development roles, which is great to see.
And, while traditionally a lot of young people were enrolling in these training courses, it is surprising how many middle-aged and return-to-work students take to this industry, especially mothers, after having had children themselves.
One of the unfortunate trends across the childcare sector is the rampant switching of jobs and frequent changing of staff in kindergartens and childcare centres. This can be disrupting to a child’s development. For an example, we work closely with Arndell Early Childhood Learning Centre where our diploma students do their practical placements. Unlike many other centres, their staff retention is exceptionally high with staff being there eight years, 10 years, and longer.
They are however, committed to ongoing staff development and professional training across all their careers. We have had a lot of them coming to our CPD and First Aid trainings and to upgrade their qualifications to diplomas.
One thing that cannot be stressed enough, is that staff and carers need to keep adding to their skills base, be committed to ongoing learning, and treat this profession more like one of teaching rather than just taking care of our young children. However, this sentiment needs to come from centre management and operational staff as much as from those working directly with our next generation.
We are combatting this issue from the point of view of solving employee underutilisation which is a $305bn/year problem. Our industries are becoming much more contract-based and the reality of contract-based industries are that contracts get cancelled, delayed, or simply don't line up, creating expensive gaps where businesses have valuable staff “sitting on the bench” in between contracts, just chewing into company cashflow.
Research shows that 27% of the workforce is underutilised at any point in time, so we believe that by accessing this untapped talent in businesses, we can reduce the talent shortage burden and increase productivity in our industries.
We do this with our proprietary B2B talent mobility platform that matches a business's idle staff who are in-between projects or contracts, to short-term contracts from other companies seeking specialist or surge support.
In this way, businesses can now manage the peaks and troughs in industry with either paid contracts for their staff in the troughs or access to the high-quality talent hidden inside Australia's best businesses. We have effectively created the largest untapped talent pool in the country―the Happily Employed!
I have managed my own business in the forklift industry for more than 40 years. Over that time, we have employed many plant, electrical, and auto mechanics for repairs and maintenance on our equipment. In this time, we have taken on apprentices and over the past five years, we have only had one complete their qualification. There is a lack of young people coming through the trades that is creating a skill shortage in the industry.
The biggest reason, I believe, that young people don’t complete their trade is that the apprenticeship system fails them. The scheme has not evolved for decades, with low wages and no gratification.
We need to change the system to reflect now, and we need to look at the way skills are taught.
At Kiandra, we recruit for a variety of different roles, from deeply technical to senior leadership. We aim first, to hire the best technically-skilled person for the role. Given this, there has been a stark skills gap in Software Developers and Seniors Networking Engineers with Azure. But the real gap is not in tech skills, it’s in soft skills. There has been a trend amongst the more technical people we have met for roles to lack the ability to talk to clients, deliver exceptional client service, and to meld and work in a team environment efficiently. These are vital workplace skills, to which there is a huge glaring gap.
This was very clear when a technician told me they had never spoken to their client while fixing a recent issue. They preferred using the time to solely focus on the problem rather than hold a simple conversation to ensure the client had a good experience. Whilst the problem was fixed―good client management and service should’ve been part of this process.
I often say to engineers that you are better to keep your client happy and informed, than you are to have delivered a perfect technical outcome, and they often look at me perplexed.
It’s like going to a café. If you get an average meal, but the service is amazing―meaning the server engaged you and made the experience great―the average food can be forgiven. Being able to communicate effectively, to build rapport, to understand what a client really wants, and deliver that, is far more important nowadays, and in our experience, rare.
To bridge this gap, technical people should be seeking out soft skills training on top of their tech knowhow. This includes how to communicate better, teamwork, and make sure that self-reflection is part of a continuous improvement journey.
The skills gap is clearly a major issue for both business and government, and initiatives for addressing it exist both at policy and enterprise levels. For example, there's the Australian Apprenticeships Incentives Program. This program offers employer incentives and personal benefits for apprentices undertaking certain qualifications (Certificate III or IV qualification) that lead to occupations like mechanics, electricians, hairdressing. In addition, certain occupations with skills shortages could be targetted by the skilled migration program.
At the enterprise level, employers can utilise strategies to attract more in-demand employees to their business but reskilling according to a clear plan is also an option. The plan should reflect what's happening in terms of disruptive trends like technology and how this impacts your business and customer relationships. Different training options, including continuous learning and development programs, could be part of the plan. How you manage your employees could also be part of the solution. For example, encouraging innovation and a culture of collaboration could allow your employees to deliver more value by focussing on capabilities that can't be replaced by machines, as automation takes over lower-skilled functions.
What industry leaders suggest
Tackling the skills gap as a nation will involve better engagement between employers and training providers, ensuring that education and training programs are relevant and staying relevant as technological advances see the industry evolve. As industry leader insights suggest, it can start from nurturing future leaders through the education sector as well as curriculum changes in schools and better support for teachers. At the enterprise level, targeting specific technology trends like big data, AI, and cloud security could be part of organisations' plans. Businesses could benefit from targeting soft skills as well as hard skills, as this can directly impact customer service and competitiveness.
At the government-policy level, it could be about responding to technology changes by focussing on specific policies like boosting the Vocational and Professional Education and Training (VPET) sector's status as a training system and better integrating it with the private sectors. Similarly, supporting more young people in trade with policy-based incentives could address the low-wage and no-gratification perceptions, and target the trades-category shortages. With both government incentives and business-level initiatives, Australian industry can successfully work to overcome the skills gap challenge to build a stronger, future-proof workforce.
Arowana is an operator of small and medium sized companies, and a specialist asset manager. We grow people, companies, and value. We operate EdventureCo, a leading vocational and professional education and training platform in Australia that is expanding across Southeast Asia. At EdventureCo, we have established specialist, reputable college brands in blue-collar and white-collar VPET fields such as building and construction, and information technology. In the last six years we have successfully trained over 65,000 students in our eight campuses across Australia to provide them with the skills and qualifications to advance their careers and employment prospects to support them in upskilling and reskilling. Our mission is to equip students with the in-demand skills they need to find employment in a rapidly changing world, where jobs are increasingly being displaced by automation and robotics.
To find out more about what Arowana can do for your business, reach out to us through: https://arowanaco.com/connect/
To learn more about our team at EdventureCo. and how we help businesses reskill and upskill, explore our website