Skills Shortages Emerging in a Tight Employment Market

The SEEK Employment Index
The tightening of the national employment market gathered pace in March as the number of new jobs being advertised continued to grow while job seeker activity was static, according to the latest employment data from SEEK.

During March, the SEEK Employment Index (EI) increased by 2.1% (seasonally adjusted) to a new two-year high. A 5.9% increase since December accounts for most of its 8.1% gain during the past 12 months and highlights that it is becoming ever more difficult for employers to fill vacant positions.

Job Advertisements
During March, job ads posted maintained an upward trend increasing by 6.7% to their highest level since the beginning of the year.

Queensland (8.0%) and Victoria (6.2%) were the stand-out states in terms of job ad growth. South Australia, Western Australia and NSW achieved more moderate increases of (5.1%), (4.8%) and (3.3%) respectively.

The number of job ads listed rose in every state, and on a national basis they have increased 40.8% since March 2006.

Commenting on the results, SEEK Sales Director Joe Powell said that evidence of a skills shortage continues to emerge. ìIn much of Australia employment supply and demand are both strong, but there appears to be a disconnect between the kind of jobs that people are competing strongly for and the range of jobs on offer.

ìFor example, in Queensland, job seeker activity is skewed towards positions in hospitality and tourism, with three of the top five most competitive jobs falling within this industry sector. Meanwhile, employers are struggling to fill positions in industries spanning banking and financial services, education and training, legal, primary industry and consulting and corporate strategy.

ìQueenslandís strong image as a holiday and conference destination may be hindering its ability to attract the skilled professionals its diverse economy now needs.

ìIn a skills-short environment, organisations that rely on specialist expertise will need to place a greater emphasis on workforce planning, as opposed to traditional recruitment. This might include offering university scholarships, additional incentives for apprenticeships or retention bonuses for valued employeesî, he said.

Professor Peter Sheehan, Director of the Centre for Strategic Economic Studies said: ìDivergent economic and labour market conditions in different parts of the country complicate the Reserve Bankís task in setting national monetary policy. But further upward movements in interest rates seem inevitable as the demand for labour continues to strengthen in the face of limited supplyî, he said.