Nine in 10 NSW businesses face 'workforce shortage'

Nine out of 10 New South Wales (NSW) buinesses now face workforce shortage, according to the 2022 Workforce Skills Survey.

According to the survey report, 93% of NSW businesses reported that they are currently experiencing a skills shortage, which negatively impacts both employers and existing workers.

“The annual survey of over 600 businesses across the State was conducted through the last week of May and the first week of June and showed that almost every business in NSW has unfilled vacancies,” Business NSW said in a media release.

Furthermore, Business NSW also said the shortage saw a significant increase compared to 2021 when only 73% of the State businesses reported skills shortage.

Business NSW CEO Daniel Hunter described the shortage as the “most significant workforce challenge in more than 50 years.”

“The survey results clearly indicate it is a whole of workforce issue – with almost half of businesses reporting that it is as equally difficult to fill entry-level positions as experienced roles,” he said.

Key skills facing scarcity

According to the survey, industries reported that positions of every skill level were almost impossible to fill, from labourers to specialist doctors. Some of the major occupations in shortage included:

• chefs and cooks 
• cleaners
• housekeepers
• waitstaff
• boilermakers
• fitters and turners
• electricians
• carpenters

Effects of the workforce shortage

While most businesses lack workforce, 79% said the shortage led to increased workload for existing employees.

“47 percent reported that they had increased wages, salaries or bonuses for existing staff as a method for addressing the skills shortage in the last 12 months,” the report stated.

Additionally, 51% of businesses said the shortage also resulted in the loss of customers and missed opportunities, while less than 1% reported that staff shortages did not affect their businesses at all.

Call to action

Based on the survey, a few reasons for workforce shortage included the lack of technical skills of applicants relevant to the position, lack of experience, and lack of appropriate or required qualifications.

Hunter said that the NSW government is aware of these challenges and is investing in a “homegrown skills pipeline and free training” to address skill shortages.

“The recent NSW Government announcement of a further 70,000 fee-free training spots, which is on top of the 100,000 fee-free apprenticeships, will deliver job-ready builders, hairdressers, carpenters, chefs, electricians and workers in the early childhood and aged care sectors,” Hunter said. “But training takes time, and action is needed now to support businesses who are crying out for staff.”

Among the critical areas for action that the Business NSW identified, which are primarily addressed to the Federal Government, included:

• Increased Vocational Education and Training (VET) funding in the new National Agreement for Skills to bring down the costs of training
• An indefinite extension to the hugely successful Boosting Apprentice Commencements (BAC) initiative.
• Introducing or extending initiatives to support people in work
• Simplifying the migration system, increasing skilled migrant numbers, reducing employer fees, and cutting visa processing times

Hunter said that the new Albanese Federal Government should not only increase the number of skilled migrants but also reduce the burden for businesses in bringing potential employees to NSW.

“We simply do not have the workers to meet the needs of our businesses, and coordinated action is needed now to fill those gaps,” he said.