Global issues – lack of skills, VET supply and demand mismatch

Australia isn’t alone when it comes to skills shortages. Most American companies are needing ‘middle-skilled’ workers – more than high school but less than a ‘college’ degree. This includes technical knowledge and an above average understanding of the tools and machines they’ll operate, which means greater problem-solving abilities.

A recent survey also noted the challenge to find quality US labour, particularly in industries like manufacturing, transportation and construction. 61% of American businesses struggle to find quality employees.

The main economic concern, in Utah for example, is no longer a lack of jobs, but not enough workers.

“3.1% unemployment is fabulous unless you’re looking to hire people,” adds Todd Bingham, the president of the Utah Manufacturers Association. Extremely low hourly rates continue to be an issue in the U.S. The ageing and subsequent retirement of baby boomers also adds to the labour shortage challenge, like here in Australia.

For millennials, there’s a negative connotation attached to ‘blue collar.’ They’re encouraged to ‘go to university’ and ‘get a good job.’ Often, this means white-collar professions. This had led to major shortages in housing construction workers, truckers, occupational therapists, railroad engineers, mathematical scientists, and medical assistants.

O’Net Online, is a primary source of skills information in the U.S. providing hundreds of occupation-specific descriptors, it showcases how every occupation has its own set of skills, knowledge and abilities. O’Net is accessible to a range of stakeholders and is flexibly captures changing job requirements. It covers the anatomy of an occupation.

The European Commission’s ESCO platform was also built to aid labour mobility. It identifies and categorises skills, competencies, qualifications and occupations.

Germany has reported a shortfall of 1.1 million skilled workers in the third quarter of 2017 – especially in engineers, technicians, tradespeople, IT specialists and healthcare professionals. Language skills are a necessity and it’s making it hard for foreigners to land jobs. People also aren’t willing to travel out of the cities.

Closer to home, digital skills are a point of concern in New Zealand. The country’s Digital Skills Forum is pushing for the Government to annually review fast changing jobs, and better align tech courses with skill needs.

This is timely as New Zealand’s school education sector has been reformed to include digital education. A greater focus on technology and opportunities post-school will help remove barriers from graduates to find their first job – making it easier for those seeking a career change in the future and improving the gender and cultural diversity in digital roles.

From an employer’s perspective, there are resources like the Skill Identification Tool to help HR attract and select the right candidates, and encourage individual development. This consists of three sets of skills, five learning-based levels of each skills (from familiarisation to problem-solver to expert), and a list of activities using each skill element, at each level.

Critical takeaways.

There’s a clear need for closer communication between education and training, employers and industry on workforce demand. Vocational education needs to be targeted, prioritised and flexible including non-accredited training.

Companies need to recognise the value of on-the-job training and try out new learning and development methodologies. This includes activities such as creating employee development plans, offering training in new areas, providing resources, and running in-house workshops or experiences.

More effective training is needed to prepare employees for new jobs that could arise with the implementation of new discovery technologies, such as AI and machine learning.

Young people need to know where to look for work in industries that are experiencing shortages. This could include training partnerships (where industry aligns with educators), shorter, more intensive programs and trade schools where students learn specific skills, apprenticeships and mentorship programs.

Candidates need to be assessed on their skills, attitudes, motivation and adaptability. As organisations switch to new technologies and ways of working, emotional adaptability and creativity will increase in importance. There needs to be a greater focus on applicants with transferable or transversal skills.

Labour and skills shortages are a worldwide concern and it takes a multi-pronged approach – connecting VET to job reality, in real-time, aligning industries to facilitate skill transfer, carrying out workforce demand research to create human capital development strategies to remove skills bottlenecks and inform national and local strategies.

If you’d like to learn more about addressing labour and skills shortages, getting a better match to demand for education and training provision, please contact Wendy Perry at

Scroll to Top