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Renewed focus on skill shortages will benefit businesses

The National Cabinet has signalled a renewed and bipartisan impetus to overcome chronic workforce shortages and languishing productivity growth.

20 June 2022 

Prime Minister Anthony Albanese is looking to tackle the growing skills shortage crisis facing Australia as it became one of the top agendas in the first National Cabinet meeting since the election. 

The National Cabinet affirmed its shared commitment to urgently addressing skills shortages. As part of the Commonwealth’s commitment, it will urgently work to address a backlog in processing visa applications in areas of skills shortages, reduce visa processing times and prioritise training and migration.

"It recognised that we need to train Australians for the needs of the day but also the jobs of tomorrow. And we need to work on a national skills plan in order to deliver that," Mr Albanese said.

“But it's also recognised that short-term shortages mean that we need work on clearing the backlog that’s there from people who have visas that have been granted and they’re waiting 12 or 18 months before they are actually able to take their place in workplaces around the country."

Mr Albanese said this backlog was placing pressure on construction and infrastructure which led to increased costs and also placed pressure on service delivery. 

"Short-term, migration will need to be a part of the solution to skill shortages and we will work with the business community as well as working cooperatively to address those issues,” he said.

Australian Chamber of Commerce and Industry (ACCI) director of economics, employment and skills Jenny Lambert said the National Cabinet’s commitment to urgently address visa processing times and focus on training would alleviate Australia’s skills shortage, now the second most severe in the OECD.

“Current processing delays mean that businesses can’t get the staff they need to operate at full capacity,” she said.

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"Developing the skills of Australians and boosting workforce participation should always be prioritised.

“But skilled migration is a crucial part of the solution. To remain internationally competitive, Australia must have an efficient and cost-effective visa system that attracts the skills we need,” she said.

Ms Lambert said businesses also welcomed the renewed focus on productivity and microeconomic reform as the fate of post-COVID recovery depended upon it. 

The National Cabinet affirmed The Council on Federal Financial Relations would provide advice for the next meeting on pressures on the Commonwealth and state and territory budgets including the anticipated fiscal pressures with a focus on areas of joint funding responsibility.

“The Commonwealth is prioritising productivity reform and economic reform and that was well received by the state and territories,” Mr Albanese said.

“It's something that's dropped off the agenda in recent times and as part of that will be a review of the former Council of Australian Governments (COAG) processes that used to exist that were replaced by the National Cabinet as a result of the National Cabinet being formed during COVID as a response to the pandemic. 

“Some of the COAG processes were really worthwhile to drive the productivity of reform, to drive efficiency, to remove duplication, a lot of that has just dropped off. 

"What we will have for the next meeting as well is first secretaries providing advice on the role of the Ministerial Councils in progressing national priorities but with a particular focus on how do we improve productivity and how do we get those gains through.” 

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