Trade shortages could become a significant threat to the economy

One of the backbone workforces of this nation is struggling with a significant shortage of skilled workers, and the results could be extremely detrimental.

With National Apprenticeship Week taking place recently (11–18 February), the discourse focused on the underwhelming number of apprentices in the trade skill workforce, with shortages hitting a critical level.

Trade and labour shortages are skyrocketing, with the predicted forecast deficit being 131,000 full-time workers by the end of 2024.

HR Leader spoke to Ron Maxwell, chief executive of VERTO, to discuss critical shortages and the urgent need to respond to this growing demand.

“This is a matter of national significance that requires new and innovative ways of thinking and better industry recruitment,” Mr Maxwell said.

Mr Maxwell spoke about the firsthand effects the current trade shortages have on people’s everyday lives, especially in the middle of a housing crisis.

“There’s a significant shortage of skilled workers right across the nation but particularly in apprenticeships, and really the impacts it’s having is certainly blowing out times for completion of construction projects, especially in the housing sector, but also it adds to the cost,” he said.

“The cost of a tradie goes up because of high demand, and I think we’ve all tried to get a plumber, and we know how much that costs paired with how long you have to wait. So that’s the real impact.”

Mr Maxwell explained how apprenticeship shortages that are causing this high demand can be related to a stigma surrounding the trade industry and can affect the decision making of recent high-school graduates when deciding their next step.

“There’s still this stigma attached with an apprenticeship, and that’s that parents believe if [their] son or daughter doesn’t go to university, then they’ve failed. Whereas, when we look at lifetime earnings, it’s often the tradies that earn the most,” Mr Maxwell said.

“I always say you just drive down the street and who’s got the biggest house in the street? It’s always the tradie. So, there are some misconceptions about earnings, but you have to look at it over a lifetime.”

In comparison to, say, working in the mines straight out of high school, Mr Maxwell did admit that the entry for tradies was somewhat of a barrier due to low wages early on; however, he cemented that it’s only for the short term.

“There are some barriers there for entry for tradies, and that is starting wages low when their mates might be working in the mines and earning big money. But that’s short term. So, it’s really that education piece that needs to continue, and we need the parents to understand that there’s a great career out there if your son or daughter chooses to move into a trade,” he said.

A strategy that is being used to attempt to nullify this shortage is looking towards under-represented communities within the trade workforce to fill the gap. Giving women and other communities accessible pathways with clear employment is something Mr Maxwell supports along with the government.

“Well, thankfully, the federal government has recognised that, and they’ve, in the federal budget, put in $38.6 million towards targeting women into trades. So, there’s some work happening there and that’s slowly changing,” Mr Maxwell said.

“We’re seeing more and more women start to take an interest in what we call non-traditional trades that are normally male-dominated. You talk to some employers that have a female sparky or a female mechanic and they often say they’re the best worker they’ve got.”

First Nations people have also been a focal point in this strategy, and there is ongoing research on how to get them to completion, which leads to building those foundations to have under-represented groups in traditional trades.

“Likewise with First Nations. There’s more and more looking at that now, but they’re still under-represented. We want First Nations people, women, [and] people with disabilities to understand that they can go into trades. They aren’t excluded,” Mr Maxwell said.

“That may have been the case in the workplace previously, but that’s changed. The world changed, thankfully, but there’s still work to be done; things move slowly, but at least we’re moving in the right direction. We’re starting to see that trajectory move up.”

Going forward, responding to this is paramount for Australia’s continued construction, utilities and infrastructure demands as the country is tackling a housing crisis paired with a growing population.

“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,” Mr Maxwell concluded.

Kace O'Neill

Kace O'Neill is a Graduate Journalist for HR Leader. Kace studied Media Communications and Maori studies at the University of Otago, he has a passion for sports and storytelling.