The record level of job advertisements and recruitment activity shows the nationwide skills shortage is set to worsen.
14 June 2022
The National Skills Commission’s latest preliminary Internet Vacancy Index jumped 0.9% (or 2,800 job advertisements) in May 2022 to stand at 298,400.
The growth in recruitment activity over the first five months of 2022 has seen job advertisements reach their highest level since the data series began in January 2006.
Job ads were 25.7% higher compared to a year ago and 77.3% higher (or about 130,100 available positions) than pre-Covid levels.
Management consultancy ASPL Group CEO Kris Grant said employers could expect greater difficulty in attracting staff and filling vacant positions over the second half of the year, putting upward pressure on wage costs.
“Recruitment activity has accelerated in May and we can expect this trend of rising job advertisements to continue over the rest of 2022," Ms Grant said.
"In another significant measure, the total number of jobs in the labour market reached 15 million for the first time in the March quarter of 2022."
"The nationwide skills shortage is likely to worsen as there are simply not enough workers to fill roles that are being advertised.
This could push up annual wages growth towards 5%, though in some sectors like IT and financial services wages pressures are greater.
Some of the greatest difficulties employers were having include attracting university graduates to their workplaces, especially public sector employers, according to Ms Grant.
“We are seeing university graduates being offered higher wages in the private sector than the public sector so they are bypassing government roles,” Ms Grant said.
“Diversity too is still a challenge in the public sector; you need to be an Australian citizen to work in the Commonwealth public service, which creates difficulty for federal government departments to attract skilled staff amidst this labour shortage.
“While that may change under an Albanese Labor government, for now, it is one of the major impediments to achieving a more diverse workforce in the public sector.
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"At a time when the nation is facing such a severe labour shortage, it would make sense to allow permanent residents to work in the federal public service."
The latest SEEK employment report also revealed job ads grew for the fifth consecutive month in May, rising 2.1% from April and 25.6% y/y.
Since January, job ads have risen 13.0% and have been at record levels each month in 2022 and applications per job ad continue to fall nationally, dropping 2.3% m/m, and are down 25.9% from April 2021.
Managing director of SEEK ANZ Kendra Banks said that they continued to see a record number of ads and staff shortages were proving a point of concern.
“SEEK continues to see record numbers of job ads on site, as major industries battle staff shortages and application rates remain low,” she said.
“Aside from the ACT, which likely saw a pause in some hiring due to the federal election, every state and territory had record levels of job ads in May.
"Without the threat of impending lockdowns to dampen the outlook, this year businesses are instead preparing for winter and the second half of the year.”
Over the past quarter, the consumer services sector has risen 18.8%, driven by increasing demand in hospitality and retail jobs. For example, job ads for retail assistants grew 32% during the past three months, while chefs and cooks rose 28% and demand for waitstaff rose 32%.
“Even roles for travel agents and consultants, a relatively small subset of tourism roles on site, have risen 152% since the start of the year," Ms Banks said
"These roles have been declining since before the pandemic began, so this upward trend over the past five months is indicative of an industry that is getting back on its feet and preparing for a big year of travel.”
"Meanwhile, consulting and strategy services also saw a 10.7% monthly increase followed by retail and consumer products. Government and Defence saw the biggest decrease at 4.6% in May when compared to April."
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