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Australia’s infrastructure skills supply is headed for a critical shortage – the time to act is now

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Australia’s infrastructure skills supply is headed for a critical shortage – the time to act is now

Australia faces a massive shortage in skilled workers to meet our ambitious plans for public infrastructure. In two years, the infrastructure workforce will be 48 per cent short of demand, a deficit of 105,000 people.

If we don’t act now, delivery of public infrastructure projects – ranging from critical energy pipelines to an expanded road and rail network and resilient telecommunications – will be at risk.

That is the finding we reached with Infrastructure Australia in preparing the Infrastructure Workforce Skills Supply analysis, a significant part of the 2021 Infrastructure Market Capacity Report, released in October.

Our report was no back-of-the-envelope exercise: by building a comprehensive understanding of the size and nature of the existing workforce supporting public infrastructure as well as anticipated changes through education, migration and demographic factors, we could identify in granular detail where future gaps will be against forecast demand. Notably, we were able to overcome traditional data limitations to provide insights specific to the public infrastructure sector and its workforce.

Australia has ambitious plans for investing in public infrastructure to support our increasing population. This will test the limits of workforce capacity and capability. Already approximately one in three jobs advertised in public infrastructure remain unfilled.

Infrastructure labour demand will soon reach unprecedented levels: by 2023, shortages will be three times greater than in 2017-18, peaking at a shortfall of 105,000 workers. And it won’t pass quickly – a conservative estimate shows workforce challenges could extend to 2028.

Public infrastructure draws from four infrastructure-based occupational groups: project management professionals; engineers, scientists and architects; structures and civil trades and labour; and finishing trades and labour.

We identified 50 specific occupations as relevant to public infrastructure. Of those, 34 are rated as either likely or potentially in shortage. These jobs include civil engineers, quantity surveyors, drillers, tilers and procurement managers. Though the shortages exist across all occupational groups, half are engineers, scientists and architects. Further analysis revealed that shortages are concentrated in mostly senior or specialist roles.

All up, about 182,000 people work to deliver public infrastructure in Australia. But these workers are concentrated in major cities (78 per cent) and in Victoria, New South Wales and Queensland (79 per cent). So labour shortages will be particularly acute in regional areas and away from the eastern seaboard. And smaller jurisdictions or regional areas also face higher risks to workforce retention; a lack of diversity in construction work means that when government funding ceases, so do the jobs.

There are several constraints on supply of skilled labour.

Firstly, an aging workforce: 40 per cent of the public infrastructure workforce is expected to retire in the next 15 years, without an adequate supply of younger workers to take their place. When each of these workers retires, the loss of experience is significant.

Secondly, regulatory and procurement practices exacerbate workforce inefficiencies. Mobility is limited between the engaged workforce that supports public infrastructure and the adjacent, trainable and distant workforces that share relevant skills. Meanwhile interstate migration to address local shortages is hampered by jurisdiction-specific regulatory requirements.

Thirdly, efforts to grow the workforce are compromised by cultural, geographical, diversity and education issues. Leakage from educational pathways is common and quality can be mixed.

Fourthly, migration alone cannot meet the gap. Our access to global talent is constrained by costly, complex and slow skilled migration processes and limited visa programs, and is exacerbated by COVID-19 border closures. Poor utilisation of existing migrants has further limited workforce-growing efforts.

Unless addressed, public infrastructure labour shortages are likely to spill over to other sectors and industries. While we found 869,000 workers in adjacent occupations could transition to public infrastructure with six months or less of training, each worker who takes a job delivering public infrastructure leaves a vacancy elsewhere. This drives competition for talent and may inflate costs.

One practical step to overcome the problem is improved information. In responding to a request from the Council of Australian Governments, Infrastructure Australia has provided a comprehensive evidence base to help the sector navigate these future challenges.

The report contains a trove of vital data, and a new Public Infrastructure Workforce Supply Dashboard offers dynamic information that allows the supply and demand of labour to be interrogated in a variety of ways, including by occupation, timing, age and gender.

The next step is to turn the information into action.

Continued investment in public infrastructure without significant expansion of workforce supply risks compounding shortages already evident in the workforce, increasing the risks to delivery of this once-in-a-generation investment pipeline.

Get in touch to discuss how we can help you understand the future skill needs for your industry and support your activities in utilities, energy, infrastructure and resources.

Connect with Hamish Ride on LinkedIn.

A version of this pieced was published in The Australian on 25 October 2021.