Skills Shortages Impacting on Business

From healthcare and construction to advanced manufacturing and tech, Australia is facing a growing skills shortage that’s putting pressure on business productivity and economic growth. According to the latest reports from the Australian Industry Group (Ai Group) and Jobs and Skills Australia, employers across sectors are struggling to fill key roles—especially in trades, engineering, healthcare, and digital technologies.

With global competition, rapid technological change, and an ageing workforce, the problem is not going away soon. Here’s how businesses are responding—and how job seekers can position themselves to fill the gap.

Where Are the Biggest Skills Shortages in 2025?

While shortages vary by region and industry, some roles are consistently in high demand:

• Engineering trades (metal fitters, machinists, mechanical engineers)
• Healthcare and aged care workers (nurses, allied health, carers)
• Construction workers (electricians, plumbers, civil construction managers)
• IT and cybersecurity professionals
• Business operations and project managers

In many cases, more than 40% of advertised roles in these areas remain unfilled for extended periods.

Why Are Skills So Hard to Find?

Employers point to several key issues behind the shortages:

• Low applicant volumes: In some regions or sectors, there simply aren’t enough qualified candidates applying.
• Skills mismatch: Candidates may have general education but lack industry-specific, hands-on experience.
• Gaps in soft skills: Communication, teamwork, problem-solving and literacy are frequently cited as missing in applicants.
• Inadequate local training: Regional skills gaps are often made worse by a lack of accessible training providers aligned with local job needs.

This combination has led many businesses to rethink their hiring and workforce development strategies.

How Are Businesses Responding to the Skills Shortage?

According to Ai Group’s most recent survey, more than 40% of businesses see skills shortages as a high or extreme risk to their operations in the coming year.

Here are some of the strategies companies are using to adapt:

1. Upskilling Existing Staff

Employers are increasingly investing in training programs to help current employees grow into hard-to-fill roles. This includes internal training, online courses, and nationally recognised qualifications. Explore options for professional development.

2. Growing Apprenticeships and Traineeships

More organisations are building talent pipelines through apprenticeships and graduate programs, particularly in trades and technical roles. Learn more about vocational training and apprenticeships.

3. Job Redesign and Multiskilling

By redesigning job roles around the talent they have, and training employees to perform multiple tasks, businesses are creating more flexible workforces.

4. Skills Utilisation and Workforce Planning

Employers are auditing current staff capabilities and aligning them more effectively with actual tasks, avoiding mismatches and redundancy.

5. Outsourcing or Subcontracting

Some companies are turning to external contractors to meet short-term needs—especially in construction and manufacturing.

6. Overseas Recruitment (Selective)

While a smaller portion of companies are looking offshore to fill gaps, particularly in engineering and tech, immigration requirements and visa complexity often limit this as a scalable solution.

What This Means for Job Seekers

If you’re considering upskilling or changing careers, the skills shortage presents a major opportunity. With government-subsidised training programs, flexible online learning, and high demand in multiple sectors, there has never been a better time to:

• Train in a trade or technical discipline
• Build skills in IT or cybersecurity
• Join the healthcare or community services workforce
• Step into operations or project management

Employers are actively looking for workers who can learn fast, communicate well, and apply practical skills. Whether you’re early in your career or looking to reskill, aligning your training to areas of shortage is a smart move.