Australia’s workforce faces a stark reality according to a new report. Compared to 13 other countries surveyed, Australia ranks dead last in both capability and overall resilience.
This translates to a workforce that’s struggling to adapt to changing demands and capitalise on new opportunities.
A lack of career progression, upskilling opportunities and flexible work options are making it difficult for local businesses to retain staff as Australia lags behind the rest of the world when it comes to using AI in the workplace, according to a global survey by specialty talent solutions provider Kelly.
The fourth annual global workforce report from Kelly, titled Building a Resilient Workforce in the Age of AI, has revealed Australian businesses have the lowest capability and resilience score out of 13 countries surveyed. One in two Australian executives (49%) find it difficult to source and retain the right talent, resulting in missed business opportunities, while only 43% believe AI will be critical to strengthening the capability of their workforce, the lowest percentage in the 13 countries survey.
Key findings:
- Leadership Lag: Australian executives hold the least optimistic outlook. They report the lowest improvement in key areas like talent recruitment, employee wellbeing, and profitability compared to the global average.Furthermore, a significant portion (25%) believes their organizations lack strong leadership skills.
- Talent Frustration: Australian workers are clearly feeling the pinch. Their top frustrations are the lack of skills development opportunities and career progression. This disconnect is echoed by executives, who acknowledge that lack of career advancement is a leading reason employees leave (35%).
- Upskilling Mismatch: While Australian executives prioritize upskilling the workforce (33%), their solutions seem misplaced. They focus on restructuring and recruitment, potentially overlooking the need for internal training and development (desired by 47% of employees but acknowledged by only 47% of executives). Additionally, they underestimate the market’s skill gap (28% vs. 33% globally).
- Diversity Disconnect: DE&I initiatives also show significant shortcomings. Australian executives are least likely to implement programs supporting underrepresented groups and underestimate the link between diversity and business performance. This is concerning as Australian executives also report the most difficulty retaining talent from these groups (53%).
- Tech Hesitation: Despite the global emphasis on AI and automation, Australian executives seem hesitant. They are least likely to view AI as critical for workforce development and lag behind in using AI for productivity, decision-making, and even talent market insights. However, they do claim success in using digital tools for learning and development.
- Flexibility Friction: Australian executives are caught in a flexibility conundrum. While they report the highest negative impact of Right To Offer (RTO) on workplace culture, they also hold the strongest intention to offer greater flexibility in the future. Interestingly, they contradict themselves by believing RTO positively impacts talent recruitment.
- Benefits Bifurcation: When it comes to employee benefits, Australian executives currently offer fewer competitive packages compared to the global average. However, they do plan to improve leave policies and ESG initiatives in the future. Notably, Australian workers report satisfaction with their employer’s focus on wellbeing and value tools and technology most amongst benefits.
“These findings are eye opening,” Pete Hamilton, vice president and managing director, APAC at Kelly, said. “Australian businesses are least likely to use AI to measure productivity, efficiency and engagement when compared to businesses globally, and a third have no plans to do so.”
“Australian businesses need to develop long-term workforce strategies that focus on career development, meaningful employee engagement, and thoughtful implementation of AI tools that combine the best of human talent and technology,” said Mr. Hamilton.
A third of Australian executives believe the Return to Office (RTO) has had a negative impact on workplace culture (32% vs 18% globally) and still plan to offer greater flexibility. Despite the ongoing skills shortage Australian workers say their top frustrations are a lack of skills development opportunities (32%) and lack of a career progression (32%). Australians are also most likely to say their organisations have poor leadership skills (25% vs. 19%). The report also found that diversity, equity, and inclusion efforts are failing, with underrepresented workers quitting as a result.
Australia is ranked last in the Workforce Resilience Index, which reveals how best-in-class businesses are building agile, capable, and inclusive teams that thrive in the age of AI. The Index identifies a group of Resilience Leaders (7% of companies surveyed) who report better results across both core business metrics and key people indicators compared to Mid-Market Performers (85%) and Laggards (8%).
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