Persistent skills hole remains

Western Australia?s skills shortage shows no immediate signs of improving, with recent figures highlighting the gap between the state and the rest of the nation. Skilled employment vacancies hit an all-time high in Western Australia in June last year, according to the Australian Bureau of Statistics. But over the longer term the skilled vacancy index shows a more alarming trend, the ABS says. The index for WA rose by 88 per cent during the past three years, compared with a fall of 3.5 per cent in the Australian index. As a result, the local barometer reached a record high of 218.4 in June last year. Despite this continuing trend, ABS analysis suggests it is not all bad news for the state?s economy, with new evidence the issue is related to the ups and downs of the business cycle. While there had been a longer three-year trend of higher vacancies, the ABS said: ?A large spike in job vacancies accompanied by a decline in unemployment in 2004-05?, coupled with the fact that the economic expansion has been endemic to a broad range of industries, ?provide evidence of the cyclical nature of the current shortage of skilled labour in the state?. Economists say this is good news because it means the skills problem is not a ?structural? one. Structural imbalances occur when there is a large difference in rates of growth between sectors or regions, creating a mismatch between labour demand and supply, according to the ABS. The Chamber of Commerce and Industry says this might be good news for the state government as it tries to deflect criticism on the issue, but if WA is to extend the boom times, it needs more action. Commenting on a recent survey of business expectations, CCI economist Noel Richards said the chamber was working closely with industry to help address the issue. ?We?re lobbying for greater flexibility in and promotion of apprenticeships in WA and advocating more skilled migration from overseas, particularly on a short-term basis, to fill the labour gap,? he said. The December 2005 survey found around 40 per cent of businesses intend to recruit more staff in the new year, while nearly a third of respondents indicated their intention to increase capital spending over the next 12 months, reflecting strong business sentiment. Mr Richards said the fact that WA businesses intended to employ more staff and invest more in 2006 was good news for the state economy, but it also meant that labour shortages and high labour costs were likely to persist. Recommendations from the government?s Skills Formation Taskforce on the oil and hard rock mining industries ? sectors hardest hit by the shortage ? are due within the month, according to a spokesman for Education and Training Minister Ljiljanna Ravlich.

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