Drop in skilled migration threat set to exacerbate skills shortages

No less than four separate surveys of businesses have underlined Australia’s growing skills crisis, but there are growing fears that a predicted drop in skilled migration could exacerbate the problem over the next two years.

A survey of 236 companies by accounting firm KPMG suggests employers are still heavily reliant on bringing in skilled migrants from overseas, with 60% reporting they had not reduced skilled migration levels during the GFC, and more than 50% complaining they faced skills shortages.

Karen Waller, head of KPMG’s migration practice, says primary 457 visa applications jumped 20% in May, making it the second-highest month of applications in the year to date.

More than half of surveyed respondents said they would hire additional workers under the scheme in the next 12 months.

“The 457 visa offers businesses flexibility in meeting temporary skill shortages,” Waller says.

“Up to half the people entering Australia under a 457 visa have subsequently been granted permanent residency. For both employers and workers, 457 visas offer the advantages of a try-before-you-buy system,” Waller said.

However, how easy it will be to source workers from overseas is a big question.

According to a report from Access Economics, net migration is tipped to fall to about 170,000 over the next few years, down from 241,000 last financial year.

Not surprisingly, nearly two-thirds of the businesses surveyed by KMPG want the Government to look at the skilled visa intake.

“The challenge for government is to ensure there is independent and rigorous discussion about what role skilled migration plays in Australia to help businesses grow,” Waller says.

The KMPG survey suggests the areas with the highest demand for skilled migrant workers are engineering, trades, manufacturing and construction.

This is supported by another survey by the Housing Industry Association, which suggested the shortage of tradespeople had reached the highest point since September 2008. The quarterly survey showed declines in the availability of nine out of 13 trades during the September quarter, with electrical, plumbing and general building all down.

Separately, a survey from recruitment firm Robert Walters found increasing skills shortages and pay rates for accounting and finance firms, while PwC’s Business Barometer said 52% of private companies were struggling to find qualified candidates.

PwC’s Greg Will said sales and marketing staff were among the most sought-after as private companies chase growth over the next 12 months.