 DEEWR's 'skills in demand' monitoring and research focuses mainly on skill shortages defined in a rigorous way. DEEWR has articulated a framework that facilitates clear assessment of the nature of skill shortages, based broadly on the approach in the United Kingdom, covering: skills in demand, skill gaps and recruiting difficulties (see definitions below). |
There is considerable ambiguity about the term 'skill shortages' in industry and media discussions, and in guidelines for training, labour market programs and regional skills analysis. In targeting skilled migration and education and training, skill shortages may be a consideration for program assistance or entry to Australia. The term 'skill shortages' is often a surrogate for more general recruitment difficulties, or skill gaps (deficiencies in the skills of existing workers). Click on the following bookmarks for more information on this topic. |
1. Skill shortages exist when employers are unable to fill or have considerable difficulty in filling vacancies for an occupation, or if there are specialised skill needs in the occupation, at current levels of remuneration and conditions of employment, and reasonably accessible location.
Shortages exist typically for specialised and experienced workers, and can coexist with relatively high overall unemployment within the occupation. An occupation may be assessed as in shortage even though not all specialisations of the occupation are in shortage. Occupations may be in shortage in some regions and not in others.
The paper What is a skill shortage? looks in detail at the meaning of supply of and demand for skills in the Australian labour market, focusing in particular on the way in which skill shortages are identified and addressed.
2. Recruitment difficulties occur when employers have some difficulty filling vacancies for an occupation. There may be an adequate supply of skilled workers, but employers are still unable to attract and recruit sufficient suitable employees.
The recruitment difficulties may be due to characteristics of the industry, occupation or employer, such as: relatively low remuneration, poor working conditions or image of the industry, unsatisfactory working hours, location hard to commute to, ineffective recruitment advertising and processes or organisation-specific and highly-specialised skill needs.
3. Skill gaps exist where existing employees lack the required qualifications, experience and/or specialised skills to meet the firm’s skill needs for an occupation. Skill gaps may apply to new employees, where employers are unable to find suitable applicants for an occupation and recruit workers who need further training and/or experience to meet the firm’s skill needs for the occupation.
There is considerable diversity in the characteristics and supply and demand challenges facing industries. The research underpinning the National Skill Shortages Strategy working groups is extensive and constitutes a rich body of evidence to examine skill shortage issues facing industries, such as:
- How extensive are the skill shortages? Have the shortages persisted?
- Are the shortages for ‘occupations’ or particular skills?
- Has growth, or fluctuations, in demand contributed to skill shortages?
- What is the longer-term trend in supply and training output?
- Is retention of skills within industries a cause of skill shortages?
- What causes skill shortages? What influences impact on particular industries?
- What other issues have emerged from the skill shortage research?
- What are the main areas for action to address skill shortages?
Skills information is used widely to assist in the delivery of employment services; to guide education and training planning; to help industry organisations, individual employers and government agencies to develop strategies for addressing skill shortages; and to advise on skilled migration.
The National Centre for Vocational Education Research (NCVER) is the main source of data on nationally-recognised VET courses and research. Data are available in publications, including the quarterly update of Australian vocational education and training statistics: Apprentices and trainees. More detailed statistics are available on request. NCVER has an extensive range of publications, many of which are relevant to skill shortages and emerging skills issues (for example, employability skills).
NCVER is also the manager of VOCED, the UNESCO/NCVER research database for technical and vocational education and training, an international database of research abstracts (in English).
The training.com.au website is intended as a gateway to training information, especially VET. This website provides access to training-related information, for example: the VET system, the Australian Qualifications Framework (AQF), Registered Training Organisations (RTOs) and Australian Apprenticeships.
Publications addressing skill shortages are available on the Department of Education, Employment and Workplace Relations (DEEWR) website.
Skills Australia is an independent statutory body providing advice to the Minister for Education, Employment and Workplace Relations on Australia's current, emerging and future workforce skills needs and workforce development needs.
The Department of Immigration and Citizenship (DIAC) publishes data on migration trends for occupations and special reports on issues such as the labour market experience of new arrivals. For more information visit the DIAC Publications, Research and Statistics page.
The ABS provides a comprehensive suite of labour market information. A lot of information on skills issues is available from the monthly and supplementary surveys. Further information is provided in a paper prepared by the ABS: Skills Information in ABS Surveys
The following links provide additional information on the concepts of skills shortages.
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