Australia’s talent mismatch between the skills jobseekers have and those employers want has increased for the sixth consecutive year. That’s according to the 2019 Hays Global Skills Index, released today and published in collaboration with Oxford Economics.
This talent mismatch has helped to propel Australia’s overall index score up to 6.0, the highest in its history, suggesting that the Australian labour market has come under greater strain in the last year.
“Despite an existing pool of labour, our index shows that it’s harder for employers to secure the right talent now than it was a year ago (see the below ‘talent mismatch’ indicator for more),” said Nick Deligiannis, Managing Director of Hays in Australia & New Zealand.
“This mismatch is focused on high-skill industries and roles that require highly-skilled professionals, such as engineering, technology, financial services and professional services.”
“In contrast, demand is falling in low-skill industries and for low-skill workers who do not regularly upskill and who perform routine and repetitive tasks that can be automated (see the ‘wage pressure in high-skill occupations’ and ‘wage pressure in high-skill industries’ indicators below).”
“Given the rapid pace of technological advancement, this imbalance will continue to escalate unless employees invest in their upskilling and employers redesign jobs and reskill displaced workers. Without such actions, the labour market will continue to struggle to keep up with the skills employers need.”
Australia’s overall index score of 6.0 surpasses the former peak of 5.9 in 2012. It is calculated through an aggregate of equally weighted indicators, each scored out of 10, with 1 being a low pressure point and 10 being a high pressure point. These include:
- Talent mismatch: Australia scored 6.1. This figure has risen for six consecutive years, which shows that readily available candidates are less likely to possess the skills employers want. With a growing mismatch between the skills held by workers, and those sought by employers, it’s harder for employers to find the right talent;
- Wage pressure in high-skill industries: Australia scored 8.6, showing that wage pressure in high-skill industries is rising faster than in low-skill industries relative to the past. This suggests there is a shortage of talent in high-skill industries;
- Wage pressure in high-skill occupations: Australia scored 6.2, showing wages are growing faster for higher-skill occupations than lower-skill. This points to a shortage of highly-skilled professionals who perform jobs that cannot be automated;
- Overall wage pressure: Australia scored 5.9, up from 5.0. While salary increases are seen in select industries or roles, such as in IT, wage growth for most professionals remains subdued. The resulting ‘tug of war’ between employers and employees is fuelling wage pressure;
- Labour market participation: Australia scored 5.7, up 1.9 points over the past three years. This suggests that fewer people of working age are looking or available for jobs;
- Education flexibility: Australia scored 4.9, up from 4.5. The number of graduates as a share of the total population has fallen, reducing the pool of skilled labour employers can recruit from.
The Hays Global Skills Index is available at www.hays.com.au/global-skills-index.