Government’s plan to combat tradie shortages could ease economic strife

Ahead of next week’s federal budget (14 May), the government has pledged funding for our TAFE system in a bid to reduce the tradie shortages affecting the country.

The federal government has announced it will fund an additional 20,000 fee-free TAFE places in the budget, helping to reduce the pressure faced by skills shortages.

A total of $90.6 million will be invested into 15,000 free TAFE and VET places and 5,000 pre-apprenticeships, all to get people into the construction and housing industries.

“This is a great opportunity for people to gain a trade while accessing government incentives and reduce cost-of-living pressures through more affordable housing,” Skills and Training Minister Brendan O’Connor said.

Denita Wawn, Master Builders Australia’s chief executive, was happy with the news: “The announcement of fee-free TAFE and VET places rightfully recognises the role of not-for-profit industry-led registered training organisations in training the next generation of tradies.”

Course positions will be allocated based on the demand needed for skilled workers across each state and territory.

Also put forward in the pre-budget submissions were plans to boost migrant involvement in the construction industry by prioritising and streamlining skills assessments for potential and existing migrants. A $1.8 million investment to streamline skills assessments for around 1,900 potential migrants from countries with comparable qualifications has been put forward.

“We know in the short-term the domestic workforce cannot keep up with demand. Skilled migration represents a vital piece of the puzzle. The investment into prioritising and streamlining skills assessments for potential migrants and those already in the country is welcome news,” Wawn said.

“For many migrants, it is simply too hard to have their professional capacity recognised to work in a trade in Australia, and they are instead in roles that present fewer hurdles to obtain. The Parkinson Migration Review found skills assessments or qualification recognition can take up to 18 months and cost nearly $10,000; time and money people simply don’t have in this economic climate.”

Initiatives that help bring people into this vital industry are necessary if we’re to keep up with construction demands. With the ongoing housing crisis as prevalent as ever, intervention is much needed.

Wawn said: “If we are going to have any chance of building enough homes, we have to prioritise capacity building of the industry. Workforce shortages remain the biggest source of cost pressure and disruption for the building and construction industry.”

“Despite a sizeable workforce of 1.35 million Australians, the industry has an annual exit rate of 8 per cent, and we are only replacing half of those people per year. Our recent report into productivity found prolonged labour shortages are reducing industry output by $50 billion and thousands of homes over the next five years.”

She concluded: “There is still a long way to go, and Master Builders will continue to work closely with the government to ensure we make the building and construction industry as attractive as possible.”

Further commenting on the announcemnts, Dane Moores, head of strategic relations at SSI noted just how crucial these intiatives are: “Australia is facing an unprecedented skills shortage, in construction and in many other industries. In some OECD countries, newcomers are less qualified than the wider population. The opposite is true in Australia."

“It is a welcome step forward to see this initiative fast-tracking the skills and qualifications recognition process for migrants with skills in the construction industry. There is a pressing imperative to extend this initiative to other key industries, as one in four permanent skilled migrants in Australia work below their skill level," he said.

"For example, around half of migrant engineers are unemployed or working in other sectors at a time where there is an estimated 30,000 shortfall in engineers required by Australian employers. Australia’s current system for recognising overseas qualifications is expensive, time-consuming and bureaucratic. This isn’t just holding back refugees and migrants; it is holding back our economy. We must modernise the skills and qualifications recognition system, and we welcome this initiative from the Federal Government as a step in the right direction," added Moores.

As previously reported by HR Leader, trade shortages are a significant threat to the economy. Ron Maxwell, chief executive of VERTO, said: “This is a matter of national significance that requires new and innovative ways of thinking and better industry recruitment.”

“Over time, [the shortage] can affect the national gross product, and it can certainly affect our economy on a greater scale as a whole if we don’t plug the shortage of tradies.”

This drives home the power of these sorts of initiatives. Without tradies, Australia stops.

Jack Campbell

Jack is the editor at HR Leader.