Full head count but still a skills gap? Here’s why

- June 30, 2023 3 MIN READ


The global skills shortage continues. The war for talent, great resignation and great reshuffle are phrases we are more than familiar with. Coined post-pandemic, they accurately assessed the labour market’s competitive state of play. Now with the global economic slowdown, the reprieve on skills must be in sight, writes recruitment expert and founder of EST10, Roxanne Calder.

Historically, hand in glove, this has been the case. The 1986 economic downturn in Australia saw unemployment rise to 8.1 per cent, and for the early 90s recession, unemployment increased to 9.58 per cent.

Yet, despite our current economic conditions, unemployment sits at 3.7 per cent. Compared to 3.4 per cent in October 2022, it cuts very little slack for businesses.

The skills myth

Cited as ‘close to full employment’, inferring more people is the answer, it unconsciously allays blame where it doesn’t belong. Even businesses with the luxury of a full headcount are suffering from the skills gap.

Here’s why:


Our perspective on work changed. For many, this means work life as we knew it is taking a back seat. Those in possession of skills are choosing roles that are less demanding and stressful. Two-thirds of employees would opt for a better work-life balance over better pay, even in our current high inflationary times.

COVID also accelerated the transition to the automated revolution. Overnight, it forced companies to change and adjust the way they work. Our workforce quickly grasped the freedoms and choices afforded by the new ways of working, but have we kept pace with the emerging skills and requirements?

Emerging skills

The 4th industrial revolution builds on the digital revolution in highly disruptive and profound ways. Think AI, human and machine interactivity, etc. – an automation revolution. Compared to our previous industrial revolutions, the 4th one is evolving exponentially rather than at a linear pace.

The speed of breakthroughs has no historical precedence. It has application to every industry and job and created a monumental demand on the skills required by businesses to remain competitive, specifically STEM skills – i.e. those utilising the knowledge of science, technology, engineering and maths.

Our digital saviours

The digital pioneers, the millennials, currently make up 35 per cent of the Australian workforce. However, by 2025 they are expected to comprise the largest percentage of the global workforce, and for Australia alone, it is estimated to be almost 75 per cent. Gen Z, the digital natives, follow directly behind.

Don’t relax just yet, as the rethinking of life’s priorities and preferring personal fulfilment is more prevalent in our younger workers. It’s a constant quandary for business leaders … how to attract and retain our future workforce?

Unconscious deskilling

Simultaneously, as we leverage the new-found technology making business better, faster and more efficient, we may be inadvertently deskilling our precious workforce. Tools to work anywhere, anytime, have enabled remote and hybrid work and – whilst convenient and highly desired – they have their cost.

For those working from home,  67 per cent feel disconnected, and 42 per cent feel lonely at work, contributing to reduced social skills, including emotional intelligence, self-awareness and communication. As much as we desperately need STEM skills – and we do – we also must hold tight to our human skills. These are critical for leadership, people management and any level of customer engagement.

We underestimated the compromise

The war for talent encouraged compromise and patience. Compromise on the skills and patience for new hires to come up to speed.

Yet, the reconciliation of skills wasn’t aligned with expectations. Consciously or not, we still expected the same output and performance levels. We didn’t allow fully for training, support, nurturing and encouragement. Resulting in 40 per cent of those who changed jobs feeling they were better off in the previous positions and 20 per cent returning to their old roles.

The sum of the gaps

Productivity is a weighty concern. The additional workload created by the gaps must be picked up somewhere. If leaning on those highly capable in your team, plan for it to be short-term only. The disparity of workloads with those carrying the burden over prolonged periods of time causes fatigue and burnout, putting your business’ skills gap at further risk. Firefighting is unforgiving, with high costs attached.

It’s a race to bridge the burgeoning gap. Take care and consideration of your existing team, allow time to train new hires, and have your eye on the skills of the future and the workforce to accompany them.

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Now read this:

Skills shortages: 5 tips to help your business now