Only a few short months ago, it seemed that Australia and New Zealand were immune to the US sub-prime contagion that was infecting global economies but, to a certain extent, that balance has changed.
In early August, the US dollar once again reared its head, surging across financial boards that saw the Euro slump to a five month low against the greenback and the pound, a 17 month low.
As the global slowdown took its toll on other major currencies, the Australian dollar fell by 1% and 2% was sliced off the value of the Kiwi dollar. New Zealand's Treasury admitted that the nation was in recession; the second country in the Organisation for Economic Cooperation and Development to slip into the black hole this year after Denmark. In Australia, the Reserve Bank has switched from consistently raising rates to suggesting that now is the time for cuts.
Although the two countries appear to be satisfied with the levels of people in employment, both Australia and New Zealand are screaming skills shortages.
John Green, Managing Director of AustCorp Recruitment, which specializes in senior appointments in Australia, gave his view on the current situation.
Australia's economy seems likely to follow the downturn currently being experienced in the US and UK, said John. The Global Credit Crunch Crisis seems to have eventually reached us all the way over here. Inflation is rising too quickly and since the fall of house prices in the US, Sydney now has the most expensive/unaffordable housing in the world with the average Sydney home costing more than eight times the average Sydney wage.
The economists have been expecting job rates to fall with many businesses making cutbacks and bracing for the inevitable slow down. However, August's job creation figures showed a surprise increase in the number of jobs advertised.
In Australia we are in a unique position. The resources boom seems likely to carry us through the tough times ahead. The result of this is an abundance of jobs in the mining industry. There really is a serious shortage of suitable experienced and qualified people available.
Qantas have said that it intends to lose 1,500 members of its workforce. Starbucks, the world's largest chain of coffee shops, said that it will close three-quarters of its 84 Australian stores. In contrast, Western Australia's booming mining industry will need an additional 86,000 workers over the next 12 years.
The Mineral's Council of Australia predicts that jobs in the industry will rise from their current level of 128,000 to 215,000 in 2020. The Labour Force Outlook in the Australian Minerals Sector 2008-2020 report details six of nine Level 1 Australian Standard Occupational Categories (ASCO,) that will represent the majority of employees in Australian mines. Those cover managers and administrators, professionals, associate professionals, tradespersons and related workers, intermediate production and transport workers plus labourers and other related workers. It forecasts that the total number of people in Australia overall in these categories will grow by a million persons by 2020. It further notes that the two fastest growing categories will be at managerial and associate professional levels.
However, mining is by no means the only sector in which Australia is feeling the pressure. Serious recruitment shortages have been noted in accounting, credit control and business analysis. And Peter Taylor, Chief Executive of Engineering Australia has warned that the country is facing an increasing shortage of qualified engineers. According to Mr Taylor, the number of engineers for the various sectors halved between 2001 and 2006 and from analysis made, he deduces that there is a current shortfall of 28,000 engineers.
Whichever way we look at the numbers, we come inevitably to the conclusion that Australia, like many other developed countries, has taken its eye off the engineering ball, he said.
John Green brings an additional slant to those sentiments and adds: The new Rudd Government have this year announced that the development of infrastructure projects is crucial to cope with Australia's rapidly expanding population. They are dedicating billions of dollars to roads, highways, rail, power, water and internet expansion projects. The main concern faced at the moment is who will run these projects. There is a huge shortage of Senior Construction Managers, Project Managers and Project Directors to run these projects.
The Department of Immigration has also had a recent shake up making it easier for engineering and construction companies to employ key people from overseas,” he continued. The Government recognizes that the skills and labour shortages are further exaggerating the economic pressures from inflation with salaries at an all time high due to the lack of competition in the job markets. There has been an increased allocation of 6000 more visas made available by the Department of Immigration in this financial year alone.
The situation in New Zealand is slightly stranger. According to a survey by international recruiter, Manpower, New Zealand has the lowest unemployment rate on record which has created a tight labour market and a strong need for skilled workers. Which may be true, but the country has also seen the greatest exodus of skilled workers, ironically to Australia, leaving New Zealand with severe skills shortages.
Clayton Cosgrove, Minister of Immigration for New Zealand said: “Immigration is a vital ingredient in New Zealand's ongoing economic development. Migrants drive innovation, give our business international connections and provide a range of skills to transform our economic landscape.
At another point in his speech at the Immigration Law Conference 2008 in Auckland, he said: Immigration is also about opening the door to the people we want and need. And added that changes in the new Immigration Bill would allow exceptions to residence policy to be delegated.
Giving the hypothetical example of a radiologist who was a year over the acceptable age limit, applying to settle in an area where there was a dire shortage, he indicated that the normal rules could be waived.
In this case, the person would be of obvious benefit as one of those migrants we want and need he said. I shouldn't need to make the decision that it is acceptable to grant a resident visa in this case. The change in the Bill will help cut through the red tape in situations like these to bring benefits to all New Zealanders.
In the engineering sector, New Zealand needs an array of skills including civil, mechanical, chemical and electrical engineers. Biotechnology is rated as being one of the fastest growing sectors and yet there is a dearth of scientists.
In recent years, the construction industry has concentrated on residential projects but has now been expanded as New Zealand focuses on its basic infrastructure, with funds being directed towards the building of schools, hospitals and improving transport and road networks.
In the field of healthcare, there is desperate need for nurses, radiologists and general practitioners while the growing multimedia industry is crying out for people to swell its ranks.
Information communications technology (ICT) is a broad discipline that is growing in both Australia and New Zealand but is suffering from a lack of people who have the technical skills and high level capabilities in communications and marketing. The ICT sector in New Zealand has been issued a challenge by the government to raise its current contribution of 4% to the GDP to 10% by 2012, supported by the High Growth project. Government forecasts have predicted that the levels of employment in ICT will rise to 125,000 in 2012, compared to the current level of approximately 41,000 people.
Australia and New Zealand are both competing for skilled professionals to migrate to their shores and continue to have Expos in two targeted areas, namely the UK and South Africa.
In a message through the Go West Now initiative, the premier of Australia, the Hon Alan Carpenter said, referring to the country’s AU$21.6bn worth of projects currently under construction in Western Australia: The only downside to all of this is that we are seriously short of skilled workers to build and operate these world class projects.
Australasia: What the Recruitment industry has to say....
Shane Little, Regional Director of Hays Construction & Property in Australia comments:
Continued confidence in Australia’s construction market, the ongoing growth of construction companies and the requirement for building and infrastructure projects to be completed will continue to see a steady flow of newly created positions. While permanent candidates are preferred, employers are considering long-term temporary candidates in light of the shortage of skills.
Project managers and construction managers with experience delivering commercial building projects over $10 million are in demand. Some contractors are turning away work as they lack the personnel to deliver projects, so this is an acute area of demand. Darwin has a massive demand for experienced construction project managers from both a civil and commercial background due to the Northern Territory’s construction and mining boom.
There is a huge demand for skills in the engineering sector, which will only increase as tenders are allocated and large project teams are assembled. Increased population growth in states such as Western Australia and Queensland is further heating the existing demand for engineers. Within commercial/ residential building, structural engineers and drafters with between 10 and 20 years experience are required due to the lack of inner city office space for the growing population, while within land development civil engineers and drafters with between 5 and 15 years experience are needed. In particular, 12D civil design drafters are needed to cope with the backlog of work to service property developers. Civil engineers with 2 to 4 years experience on road and infrastructure projects are also required.
Within coastal/maritime infrastructure, increased international trade underpinned by the resource sector and to a lesser extent the increased population growth and density along coastal regions have created demand for all levels of engineers and drafters.
Is another area of demand, where insufficient infrastructure to service increased demand and the long-term global concerns for our environment have created a need for engineers and drafters with between five and 15 years experience.
Meanwhile environmental engineers and scientists are required nationally due to stricter regulations on green and brown site development, yet there is a limited pool of experienced environmental candidates in the market.
Finally, civil infrastructure specialists such as engineers and drafters with proven experience in the design of roads, coastal/maritime, rail and bridge projects are needed, as are electrical engineers with building services experience and 5 or more years experience.
Hays Engineering recently conducted a large scale overseas recruitment campaign for rail engineers with a large infrastructure company. One position filled was a Rail Planning Manager. The candidate was based in the UK in a similar role within a large contracting organisation and was interested in relocating to Sydney. He obtained a role that increased his salary level, offered him relocation assistance and a visa enabling him to work for that company for the next 4 years.
Oil & Gas:
As the oil & gas market reaches full swing nationally, companies across Australia are responding to the shortage of talent by recruiting candidates from overseas. Many specialist oil and gas companies are running expensive overseas advertising campaigns to attract staff and there has consequently been an increase in the sponsorship and relocation of personnel. In just one example, an employer sponsored 40 Drilling Supervisors and Tool Pushers.
South Australia has seen an increase in both smaller owner operators and exploration programs. Victoria has many projects at the feasibility, design and planning stages, Western Australia has five LNG projects at various stages of development and with a major increase in exploration drilling and five FPSO's recently arrived or en route to the state, the oil & gas sector is experiencing its highest peak in activity in many years in WA. Similarly to the mining market, Queensland’s momentum is rising with the Coal Seam Gas (CSG) or Coal Bed Methane (CBM) and Liquefied Natural Gas (LNG) markets, which are growing due to the relatively low associated exploration costs compared to the crude or oil energy sectors.
CRS Recruit Comment: New Zealand Skills Shortage
As a result of the skills shortage issue in New Zealand, specialist engineering recruitment agency, CRS Recruit, is progressively turning to the global arena to attract engineers. Ray Chamberlin the agency’s Managing Director says “The aim now is to target professional engineers from the UK and other global locations and encourage them into migrating to New Zealand. Our client’s have a growing need for engineers across all the disciplines and it is our job to find these people for them”. The agency has recently assisted a number of UK residents in finding positions throughout New Zealand, such as Claire Cornelius a Civil Engineer / Traffic Planner and Eric Hutton a Civil Transportation Engineer.
Claire and Eric are amongst a growing group engineers who are making the move to New Zealand. The New Zealand Department of Labour would like more people like these migrants to make this move; in fact, they have recently embarked on a marketing campaign to attract Engineers from the UK and Western USA to relocate to New Zealand.
Comment from Personnel Concept in Australia:
"Engineers in the disciplines of Civil, Structural, Electrical, Mechanical, Environmental and Process are in high demand for major infrastructure and mining projects in Western Australia. Rising commodity prices fuelled by the enormous growth in China and India have resulted in significant salary increases amid major international investment. Career opportunities as well as a laid back, healthy, safe lifestyle has resulted in significant migration from countries such as the UK, South Africa, Canada and New Zealand says Personnel Concept, a specialist recruitment consultancy specialising in engineering, mining, construction and accounting who have placed numerous Engineers into major mining houses, large EPCM firms as well as boutique consultancies. Attracting candidates through international seminars as well as their specialists website www.downunderjobs.com.au and having an experienced team of recruiters many of whom have emigrated themselves to Australia means we can offer an obligation free assessment of possible opportunities."
More than 178,000 people have migrated from the UK to Australia since 2001 Immigration Department statistics