The Australian paradox is that high unemployment levels are likely to remain despite the projected good economic growth in the coming decades. Experts warn that unemployment levels in Australia “is not a general problem, it’s very specific to a particular group of disadvantaged people” and in fact Australia faces a severe labour shortage that could threaten Australia’s future economic growth, reports the ABC.
Low birth rates which is below replacement levels, an ageing workforce, an undersupply of skilled labour and a growing economy will lead to a severe labour shortage in Australia by the end of the next decade, warns one of the world’s biggest management consultants. Boston Consulting Group has released a report predicting a shortfall of 2.3 million workers by 2030. The firm says Australia’s economic growth risks losing momentum in the years ahead unless the country can find ways to plug the gap.
“One of the primary things we looked at was historical growth rates, and if we look back across the last 10 to 20 years for Australia, look at how we’ve grown – and it’s been between 3 and 3.5 per cent GDP per year – if we project that forward, then Australia is going to be facing a labour shortage, and it’s going to hit pretty badly by 2030” says the report.
Boston Consulting Group sees a range of solutions to ensure Australia’s future economic growth is not threatened by an undersupply of workers. They include boosting skills training to lift productivity, as well as extending the Government’s skilled migration program. The Government has also proposed another remedy – raising the retirement age to 70 by 2035.
Experts note that the economy and employers require high level skills and will need to get them from a well-trained workforces or a skilled migration programme. In contrast to this is the unemployment issue in Australia which experts say is linked to a specific group of people who need to upskill to help the economy.
University of Canberra labour economist Phil Lewis says, “I think our major problem is unemployment in Australia, is not a general problem, it’s very specific to a particular group of disadvantaged people…What I would say is that, I think as long as we can find a solution to these people who are poorly educated, left school before Year 12, if we can get them skilled up to basics, generic skills, people skills, numeracy, literacy et cetera, that will go a long way to reducing unemployment.”