What will Unemployment Rates With a 3 in Front of it do for Labour and Skills Shortages in Australia?

Unemployment was at 4.2 per cent nationally and The Prime Minister of Australia, Scott Morrison stated,

“I believe we can now achieve an unemployment rate with a 3 in front of it this year.  Our goal is to achieve this in the second half of 2022.

We have not seen this in Australia for almost half a century.  This is a once in a lifetime opportunity.” (Address, National Press Club, 1 February 2022)

And whilst this is an ambitious goal there will be unintended consequences for employers and employees, industry sectors, supply chains, regions, cities and towns who are already reporting significant labour and skills shortages.

On the ‘now’ issues, considering my home state of South Australia, Skills Shortages are Biting SA On The You Know What, where attracting and recruiting employees in times of labour and skills shortages means,

“Tapping into new, diverse workforces, considering the need for a contingent workforce, offering flexibility and working from home options, seeking out highly skilled talent migration, with childcare options and school holiday programs.”

Back in April 2021 I wrote this blog titled, When 6.3% Unemployment Actually Feels Like 2.1%, and in March 2021 a blog on Skills Anticipation to Inform Education and Skills Development, Policies and Programs and it seems like whilst these issues could be somewhat foreseen they are now hampering organisations capacity to provide products/services and grow.

Employers really need to talk through with their team members what they need in terms of attraction and recruitment, retention and development, reward and recognition being involved in designing workforce strategies that are many, varied and suit the context.  Ideally you’d like to see organisations, industry sectors and regions developing strategic workforce plans which can address current and future gaps..

An example of a growing company that is scaling up and thinking creatively about their workforce is Atlassian, who plans to triple its workforce by hiring remote talent from across Australia (Business Insider, 28 January 2022).  Working from anywhere, as well as attracting underutilised cohorts such as women with young children, people with disability, Culturally and Linguistically Diverse (CALD) people, Aboriginal and Torres Strait Islander people, people who are underemployed in their own business, plus mature people seeking project-based opportunities must be part of the mix.  And if you are in a location where there are high level opportunities that you need to attract people to, especially regions, cities and towns, you might proactively reach out to Dom Price, Atlassian’s Work Futurist, as it could lead to discussions on diversifying the jobs on offer in your local economy.  Appreciate this could sound counter intuitive to some, especially where you may not have a big labour pool to draw from, and Regional Australia Institute reported on 4 February 2022 that the Regional Labour Market is at Full Employment.  But as an example, perhaps you have several farm managers roles to fill, and you need to attract people and their families into the area.  Having a possible partnership with employers like Atlassian and others, could be a real draw card, particularly where flexibility, family friendly work is a priority.

Back to the unemployment rate with a 3 in front of it and the unintended consequences, what might play out?  The following list is a starting point and thanks to Glenn Hickling, Economic Growth and Investment Officer at City of Onkaparinga for your prompters on these topics:

  • Ability to set your price as a potential employee in some sectors/roles
  • Essential worker burn out and exodus from the various sectors
  • Expectations on increased hours and workloads
  • Extreme labour and skills shortages
  • High job vacancy rates and churn
  • Increased reports of bullying, sexism, racism where diverse workforces are not supported
  • Interest rate hikes
  • Massive wait times for tradies, building and construction work
  • More outsourcing opportunities overseas and partnerships with developing countries
  • Remote work options non-negotiable (expected) for many jobs
  • Significant changes in workforce attraction, recruitment and retention packages
  • Wage inflation and growth – under paying or not paying market rates will be near impossible

And where is Australia, as well as each State and Territory at in relation to being prepared for this current to future workforce picture?

Well, there are two glaringly obvious gaps:

  1. A vision for the Australian Workforce (can you believe that most other countries, particularly developing countries, have had documented visions in place that they have been working on for decades, often with a 5-year timeframe that is updated and iterative);
  2. and Innovative, creative funding options to support a pragmatic target unemployment rate.

So, what do you see as the impacts of unemployment with a 3 in front of it?

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