While the Great Resignation has slowed down, businesses are still battling tooth and nail to find and retain employees.
Most of those who moved jobs in the past year still consider another change. Numerous analysts predict that high employee turnover rates will continue until 2022 and possibly longer. Meanwhile, hiring demands are causing many firms to over-promote or over-compensate new workers when the skills scarcity is already making things difficult for small businesses, according to a survey published by RMIT Online today.
Due to market competition and high applicant expectations in the previous year, nearly half of Australian managers (46 per cent) said their companies had to overpay for new workers. The same percentage (40 per cent) also claims that those hired lack the knowledge or expertise required for the new positions. Additionally, according to the research, 35 per cent of managers and a quarter of non-managers, new employees receive the highest pay for their roles, leading to conflict inside the organisation.
According to the report, 34 per cent of managers who switched companies in the last year are worried that they lack the necessary abilities. They are so concerned that just months into their new employment, 37 per cent of them are actively seeking another one.
Managers and staff frequently transition into new positions even when they are ill-prepared for them. According to the research, the majority of dissatisfied employees (57 per cent) don’t feel valued by their employers, and a half (51 per cent) think their pay is insufficient for their position or level of responsibility.
Rising inflation is also contributing to increasing career moves. Over 85 per cent of those surveyed say a higher cost of living makes financial compensation more critical now than a year ago, increasing the likelihood of moving for a better paycheck.
The research reveals that over a third of workers changed jobs in the past year for better pay. Of those, 61 per cent did so for less than $10,000 a year, and 28 per cent for less than $5,000. “A tight job market means many companies are more open to fast-tracking careers or hiring professionals with fewer years of experience,” says Claire Hopkins, RMIT Online Interim CEO.
“This is not necessarily a problem and can positively contribute to finding and promoting great talent. However, businesses must complement this with support and training to ensure new employees have what is needed to succeed.”
The CEO adds that leaders have to understand the issue better to support new hires and avoid creating attrition within the current employees.
“The talent shortage means retaining team members is critical. Companies must ensure they are actively putting strategies together to prioritise their employer value proposition through remuneration or providing on-the-job or formal training opportunities to help staff realise their potential.”
Business organisations have commented on the effects of the severe skills shortages that impede the Australian economy since the National Skills Commission released its most recent Skills Priority List earlier.
For example, a major skills gap in the technology industry will necessitate nearly tripling our tech workforce by 2030 to fuel economic growth and keep Australia on the cutting edge. According to Karin Verspoor, Executive Dean School of Computing Technologies, an additional 650,000 IT employees will be required in Australia alone by the end of the decade, and this demand will continue to expand significantly.
The Skills Priority List (SPL) provides a detailed overview of Australia’s skills shortages, both nationally and by state and territory, as well as expected demand for specific occupations. It was determined that there are currently 286 open positions, up from 153 in the same period in 2021. Scaffolders, technicians and craftspeople, miners, and landscape gardeners were among the country’s low supply.
Time to upskill the workforce
Addressing these shortages will take more than boosting short-term migration, said ACS Chief Executive Officer Chris Vein: “Every country is facing these job shortage issues, and Australia is in a competition with every developed country to attract skilled workers. Simply making more visa slots available is part of the solution, but much more is needed.
“One of the quickest ways of addressing our skills shortage is harnessing our national assets, particularly Australia’s educated, flexible and diverse workforce, through upskilling workers and boosting the industry’s diversity.
“Ahead of the last Federal election, ACS called for increased funding for reskilling, diversity programs, and support for workers and employers looking to boost their digital skills.
“We’re delighted the Albanese government has adopted some of these measures, such as offering more free TAFE places and reviewing the diversity of industry support programs. We look forward to furthering positive moves in the upcoming Federal budget.”
Mr Vein also pointed out that the IT skills shortage is a national issue affecting all industries and regions and not just the capital cities’ tech sectors, saying: “These jobs on this list are not just in technology companies but across all business and communities. IT is essential for agriculture, resources and tourism industries, and all parts of Australia must have enough technology workers to keep their local economies running.”
To learn more, visit https://online.rmit.edu.au/insights/2022-oct.