Despite the cooler weather, Adelaide is sweating it out in a global race for talent, with workforce shortages continuing to be felt across the board and across most industries.
Demand for skilled labour is being driven by welcomed growth in key sectors including defence, space, construction, agriculture, manufacturing, mining, energy, health and education.
Underlining the state’s workforce challenge, a recent South Australian business poll revealed an average of 56.2% of businesses have reported experiencing staff and skill shortages over the March 2024 quarter, with over 37% of businesses reporting a ‘misalignment between the skills required and the skills available in the labour market’[i]. This is a sentiment that resonates globally and charts a widespread workforce readjustment following the pandemic.
To tackle this important issue, the Committee for Adelaide, in partnership with Deloitte and Mitsubishi Motors Australia, recently hosted a conversation on South Australia’s current and future talent, skills and workforce needs. The event included a keynote by the Acting Skills Commissioner, John Chapman OAM, and an experienced panel of industry leaders including Shaun Westcott, CEO of Mitsubishi Motors Australia, Claire Scapinello, CEO of ECH and Matt Opie, CEO of Defence SA.
The conversation highlighted the State Government’s focus on building a skilled workforce, with the soon-to-be-formed Department of State Development, the Department for Education and the SA Skills Commission actively working to ensure our education and training system is fit-for-purpose and responsive to industry needs.
As the Premier pointed out at the recent ‘Defending Australia Summit’ in Canberra, South Australia’s AUKUS nuclear-powered submarine project alone will need an “incredible number of skilled workers”. These workers will be actively recruited from other Australian industries, jobs which overlap significantly with those required by the mammoth construction effort needed to build housing and critical public infrastructure.
The State Government is doing a lot of the heavy lifting in equipping the state’s future workforce, including the creation of the South Australian Skills Commission and developing a new skills policy to drive reform and investment in training over the next 10 years. The State is also investing heavily in five new technical collages, offering fee-free TAFE courses and targeting sector-specific workforce requirements such as the new Defence Skills and Training Academy at Osborne. A sizeable $2.3 billion is being invested by the State and Commonwealth Government over five years under the National Skills Agreement to provide for the jobs of the future.
However, fixing our state’s skill shortage is not a race that can be won by government alone. Industry also has a role to play to recruit, retain, plan and invest in future workforce requirements.
This point was made abundantly clear at the Committee’s recent event with the panellists each sharing examples of their own workforce strategies including the importance of offering clear growth pathways, on-the-job training and transition opportunities across teams and programs to upskill and retain staff.
Shaun shared how Mitsubishi Motors dealers and staff are incentivised to undertake training and upskill, including offering a reward system for completion and a culture of reward and recognition. Similarly, Claire noted that ECH is employing a digital training officer to actively work with staff to build digital literacy and software skills, supporting employees to upskill within the organisation, while also improving service delivery for customers.
The importance of skilled migration to South Australia was also discussed. The Committee for Adelaide has long advocated that population growth is critical to meeting current and future workforce needs, boosting productivity, and accelerating long-term and sustainable economic growth. Cutting migration and capping international student numbers, as recently proposed at the federal level, is not the answer.
While there may be a need to rebalance temporary and permanent migration intake and distribution at the national level, skilled migrants and international students make a significant contribution to our local economy and should continue to be welcomed and celebrated. More effective reforms would be ensuring the integrity and better targeting of migration programs, providing clearer and quicker pathways to permanent residency and maintaining South Australia’s status as a regional jurisdiction for skilled migration to complement our local workforce and fill critical skill gaps.
Attracting workers to Adelaide is one aspect; keeping and retaining our talent is another. We need to ensure that when people do arrive in Adelaide, they feel welcome, included and they build networks and connections across the community to support long term settlement outcomes.The Committee for Adelaide’s successful ‘Adelaide Connected’ program aims to do just that – providing opportunities for migrants and expats to meet with likeminded people, learn something new, and build their local professional and personal networks. The program has shined a spotlight on the need to recruit employees based on their skill offering, including matching skilled migrants to jobs of their expertise, with 44% of migrants coming into SA currently not working in their nominated occupation (compared with 30% nationally) and 54% working below their skill level (compared to 25% nationally). As a result, we have engineers driving Uber’s, qualified architects working in convenience stores, and highly qualified technology professionals working as cleaners, simply because their qualifications are not recognised locally, or they can’t get into the local job market.
It’s clear we need to remove unconscious biases from the recruitment process. Ensuring diversity in HR and recruitment teams is key.
Promoting career pathways to students, parents and career advisors is also part of the solution. Parents and career advisors have a huge impact on education and career pathway decisions and should be actively informed of the opportunities on offer, particular across new and emerging sectors. As an example, Matt Opie shared the US Navy’s effective campaign to actively recruit young people for the countries nuclear-powered submarine program, with the URL and tagline simply: ‘Build Submarines’.
While we recruit talent to work on the submarines, there is an equally critical need to recruit thousands of health and aged-care workers. With the number of South Australians aged over 75 set to increase from 166,000 to 256,000 by 2040, there will be ongoing demand for not only nurses, GPs and specialist medical professionals but home care and support workers.
‘Glamourising’ vocational education and trades will be needed to ensure we have the appropriate mix of skilled workers for current and emerging growth sectors including construction, defence, education, health, aged care, IT, manufacturing, the green economy, hospitality, and resources.
Artificial Intelligence (AI) and digital technologies present enormous opportunities not only for the aged-care sector but for a wide range of industries and businesses to boost productivity, improve service-quality and divert much-needed skills to other value-add areas. Rather than taking jobs, AI can provide opportunities to make workplaces more effective, safer and alleviate some skill shortages by automating routine tasks and augmenting human capabilities.
As pointed out in the Committee for Adelaide’s ‘5 Point Plan to Boost Productivity,’ Adelaide is home to the world-renowned Australian Institute of Machine Learning, presenting a unique opportunity for SA to be a global leader in AI, automation, smart systems and other digital technologies. If embraced properly and quickly, AI could help solve some of our workforce challenges. After all, there is plenty of work to go around.
With latest figures released by the ABS showing that South Australia’s unemployment rate is sitting at 4%, on par with the national average, another solution to the labour squeeze is increasing the state’s participation rate, currently second lowest in the country. As John Chapman OAM raised in his opening address, South Australia has a significant youth unemployment rate of 9.6% in the 15 to 24 age group as of April 2024. There are also 10,000 long-term unemployed in SA, accounting for 27% of the unemployed. The South Australian Productivity Commission is currently undertaking an inquiry to better understand the reasons behind these figures, including any failures or opportunities in our training and employment system.
It’s clear that addressing the skills gap in our state is not a task with a simple solution. And the race for talent is proving to be a marathon, not a sprint. But with growth across critical sectors, South Australia is in a good position to get ahead, with plenty of opportunity for those looking for work, considering a change or just starting out in their career. The trick will be ensuring a shared, sustained and concerted effort by government and industry to attract, retain and grow the talent and skills required for current and future workforce needs.
Sam Dighton, Chief Executive Officer, Committee for Adelaide
[i] https://williambuck.com/wp-content/uploads/2024/04/March-QTR-24-SOBE.pdf
