A fall in graduates as a share of the population may make it more difficult for firms to find new workers with the skills they need.
The forecast fall in youth participation rates this year is the biggest driver behind Australia’s tightening labour market.
A rising job vacancies rate last year has also put upwards pressure on Australia’s score. This suggests that it is harder for employers to find the right talent.
Managing Director, Hays Australia
Last year was a remarkable year for jobs growth in Australia, as evidenced by consistently strong vacancy activity, a falling unemployment rate, widening skill shortages and positive forward hiring intentions. It is no wonder Australia’s Overall Hays Global Skills Index score climbed for the fourth consecutive year. Demand for highly-skilled professionals and in high-skill industries now far surpasses the need for low-skill workers and in low-skill industries. Add a talent mismatch score that has grown for five consecutive years, and it’s clear that all professionals must continuously upskill to remain relevant and employable in our increasingly automated world of work. For employers in such a market, promoting career progression and development opportunities will aid attraction and retention efforts.
Nick Deligiannis, Managing Director, Hays Australia
GDP growth is relatively strong at between 2 to 3%. The IMF forecast it will remain at around 3% over the next five years (2018 to 2022).
The Australian Bureau of Statistics’ Labour Force Survey measure of the unemployment rate fell to 5.5% in 2017. This is its lowest level in five years, albeit above the annual low of 4.3% reached before the global financial crisis. Unfortunately, the average duration of unemployment remains high at above 45 weeks. This suggests some of these jobseekers’ skills will deteriorate and they will not be accumulating new ones from work experience.
This strength in demand in combination with robust projected increases in working age population is expected to lead to employment growth over the medium term. The IMF forecast the unemployment rate will fall to 5% and remain at that level.