Securing Australia's future
At a time when we need as many people in the workforce as possible to see us through the recovery from the pandemic and drive sustainable, long-term growth – we are presented with a budget that delivers little to solve the skilled labour shortage - a major limiting factor in our recovery. The Budget effectively has a 6-week horizon – enough time to buy votes for the next election.
With unemployment set to dip as low as 3.5% by June, lack of meaningful change to make it easier and more attractive for workers of all types – carers, working mums, etc – to join the workforce, and little to no changes to migration levels to supplement the need for essential skills – the maths in the Budget simply do not add up. This is a supply-demand issue where focusing on how to drive greater participation of labour in the right places at the right time could not be more important than it is now.
Talent retention remains fragile and organisations will really need to improve their game on the employee experience. The employee experience encompasses everything from career opportunities, skill development, flexibility and balance – making work work for them, wellness and health. Culture is king and simply paying well is no longer enough, when it is the employees’ market. Employers are going to have to raise the stakes.
Below we provide an overview of how the 2022/23 Federal Budget might address some talent shortages and critical skill development and provide further employment opportunities for the future ahead. But does it go far enough?
The Budget contains four central themes: apprenticeships, jobs for regions, positioning for the future, and small business. Measures include:
Positioning for the future - a raft of initiatives
The focus on jobs for regions includes:
Small business – implications of the tax relief
All of these elements are primarily targeted at funding more places for young, disadvantaged, aged care sector, seasonal and regional workers. Yet the reality of this investment is that it will likely take years before we see dividends and - with the exception of seasonal workers and a net 10,000 additional skilled workers visas – it doesn’t necessarily address the critical shortages in labour supply we are seeing now. It remains to be seen whether small business will take on more staff, invest in training or utilise the difference to make up for their losses incurred during the COVID years.
Whilst incentivisation to grow the workforce within aged care is absolutely essential, these measures do not go far enough and do not address the fundamental problem of a workforce shortage:
The Government’s approach looks at five central themes: boosting female participation, improving women’s safety, investing in health and wellbeing, boosting economic security and creating pathways for women leaders. Measures include:
We are keenly interested in the measures and how they translate into workforce impact that benefits women. The question is “Is this enough and will it materially change lives and outcomes, not only for women themselves, but for those around them?” Whilst some of these numbers might look impressive on paper, in reality they just aren’t big numbers at all. We are not addressing wage disparity in the short term and this will continue. We need to do more to truly advance women’s participation and investing in their futures.
This content is intended to inform clients of Mercer’s views on particular issues. It is not intended to be provided to any person as a retail client and should not be relied upon or used as a substitute for professional advice specific to a client’s individual circumstances. Whilst Mercer believes the prospective information and forward looking statements made by Mercer in this report are based on reasonable grounds, they are predictive in character and may therefore be affected by inaccurate assumptions or by known or unknown risks and uncertainties. This content has been prepared by Mercer Consulting (Australia) Pty Ltd (MCAPL) ABN 55 153 168 140, Australian Financial Services Licence #411770. Any advice contained in this content is of a general nature only and does not take into account the personal needs and circumstances of any particular individual. Prior to acting on any information contained in this content you need to take into account your own financial circumstances, consider the Product Disclosure Statement for any product you are considering and seek advice from a licensed, or appropriately authorised financial adviser if you are unsure of what action to take. ‘MERCER’ is a registered trademark of Mercer (Australia) Pty Ltd ABN 32 005 315 917.
Copyright 2022 Mercer LLC. All rights reserved.
No matter your industry, we’re here to help you find the extra value in your investments so you can stay focused on your business and priorities.
Has your fund considered its next move? Let us help you imagine a brighter future for your members in a rapidly changing environment.
An effective talent strategy means embracing the needs of a diverse workforce while navigating the future of work. Let’s make your people your best asset.
To learn how Mercer can assist your organisation with the outcomes from the Australian Federal Budget please complete your details below