Top business leaders have shared their strategies for dealing with ongoing skills shortages.
They told Megan Lilly, Executive Director of the Ai Group Centre for Education & Training, that challenges existed within recruitment, retention and developing skills, but measures in place were having a positive effect.
At the Centre’s webinar — The backbone of the economy: skills outlook and challenges for 2022 — last week, Ms Lilly said skills shortages remained deep and widespread.
“There are not enough people for the jobs available,” she added.
“We need to work hard to develop strategies to deal with the problem. This is a long-term discussion, but we’ve got some immediate urgent issues that we need to focus on.”
In an exclusive Ai Group report, 73% of Australian CEOs surveyed said they expect to have difficulty in finding and retaining skilled labour in 2022.
In the same survey, more than 60% said they would improve and retain their existing talent pool in response to the deep and widespread issue.
“There is a significant national challenge to keep developing an appropriate supply of STEM (Science Technology Engineering Maths) skills in Australia,” Ms Lilly said.
“Pre-pandemic – the 20 years before the pandemic – STEM skills occupations grew by 85%, with all other occupations growing by 40%.”
At the webinar, Ms Lilly spoke to:
ML: What do you see as Australia’s biggest skills challenges for 2022?
TS: For us, the challenge has been to skill up our staff to meet the challenges of delivering products. There is also a range of manufacturing issues we need to address.
CR: We are a defence company so whilst the talent pool is small, it becomes even smaller because we typically can hire only Australian citizens. However, COVID has taught us that a workforce does not need to be in the same place. This means we have this tight talent pool that is now attractive and accessible to a global market.
AN: There is a big melting pot of challenges for us. Not only do we have skills and labour shortages, we also have significant regional pressure. Specifically, people do not want to move to the regions, or our regional competitors are increasing their wages and salaries. We can’t compete on price or salaries alone. So, overall, the focus has to be on employer of choice and employee value proposition concepts.
ML: Is the greatest pain point in retaining, recruiting or developing skills?
AN: Unique skills are hard to find. For example, a wood machinist is a particularly challenging role for us to fill. It is a struggle to attract the few who are out there.
CR: We are experiencing challenges in the engineering space, particularly with software skills, ICT and systems engineering. There are more systems engineering vacancies advertised than there are systems engineers in Australia. So, it is competitive from a recruitment perspective and therefore, from a retention perspective.
TS: Many students find it daunting to work in defence, so they are reluctant to take up the opportunity of an internship.
At the senior level, meanwhile, people with 20 or 30 years of experience in other industries want to join our company, but they lack the knowledge to be relevant in the defence context.
As a start-up, time is limited. Time is money. We need to produce. We need to get results quickly to be able to deliver to clients or to show our capability. That throws a lot of challenges in delivering on the objectives that I set the company on. It’s a matter of working with the people I have and trying to understand their skills and strengths and seeing where they contribute so we can move quickly.
ML: Are we changing how people work and the tasks they do to help relieve skills shortages or address the problem?
CR: More resilience is needed than decades ago because aspects of work are changing so quickly today, owing to the pandemic. We are now working from home or remotely or working in a hybrid fashion. These are all causing us to work differently.
Regarding our existing workforce, we are constantly reviewing ourselves and looking at whether the right people are doing the right work. The end game is delivery to the customer.
We look internally and externally in terms of how we are going to deliver. In the past, you could just pop an ad on Seek to fill a job. You cannot rely on that anymore, so we have to look at how we can do this ourselves. We need to look at development, streamlining and retraining and stop doing things that don’t matter.
We also need to look at the external market, whether that’s training or adjacent industry hires.
ML: What about job redesign?
CR: Our engineering department is looking to our technicians to potentially bridge the skills gap. What are integration and test engineers doing that technicians could be contributing to? This thinking gives technicians upskilling, higher levels in engagement and productivity. At the same time, systems engineers and integration and test engineers are freer to do other things.
TS: Because we are a small workforce, I am conscious of projects having redundancy. For example, if my electronics engineer falls sick, can we still progress some of his work if he is not there? The same with my software programmer if he is not here.
We tend to have open discussions during which everyone is aware of how things work and can multitask to the point where sometimes my electronics engineer could program something, or my software engineer could program some embedded system which typically would fall more on to the engineering side. It is having that versatility.
We have regular meetings to discuss this. Everyone is learning, but everyone still has their area of specialty.
AN: We have programs focusing on lean manufacturing; the concept of managing waste and doing things more efficiently.
We are looking at the full gamut of attraction and retention. In our opinion, being an employer of choice is about flexibility, trust, clear expectations and having the tools for people to do their jobs. We are comfortable in responding to what people are looking for in our market.
ML: What strategies have you implemented to address skilling challenges?
AN: Our leadership team has been restructured to improve diversity and we have AI software to remove bias at the frontline in the recruitment space. We conduct interviews with applicants by a panel comprising an even split of gender diversity; they are never 1:1. We also look at the language we use in our advertisements and position descriptions. As a result, we have had a significant intake of females.
We have two plants in Maryborough — one larger and one smaller. Our larger plant now has more than 300 people, up from 230 people before our latest intake. Previously, there was one female on the floor. Our intake of 70 team members means we now have 50% more females. This has increased diversity across our organisation by 5%, which is significant for a business of our size, with 750 employees. We are tracking cultural diversity next.
CR: One of the strategies we’ve put in place is around capability hubs — how we can take work to the people rather than expect everyone to relocate, because they are not going to.
Among our successes is introducing a Diploma of Digital Technologies. We had a trades workforce that needed to be upskilled. About 50 people were in that first tranche. Now they are paraprofessionals that we will need moving forward. That is continuing, so we are pleased with that.
The other initiative is a collaboration with Ai Group — a System Engineering Degree Apprenticeship. We will hire people to work for us and pay for them to go to university to become engineers.
We need systems engineers. That doesn’t fill the gap now, but it fills the gap into our future. That creates our pipeline. These are skills that we will always need. These students get real-time experience while obtaining a degree. They may come to us from a trade background, or they may come to us from out of school. These longer term initiatives are significant and take a lot of investment.
An initiative that is bearing fruit more quickly is our link with Stem Returners. This program targets people with STEM skills who have had extended career breaks or who are keen to move from another sector into the defence industry and matches them to new career opportunities.
BAE Systems is the first Australian company to join with STEM Returners. Participants come on board for a paid internship for 12 weeks. We’ve made an offer to everyone who has come on board with us through this program. There’s no commitment beyond those 12 weeks, but if they’re great, why wouldn’t you keep them?
We’ve also launched a pilot with a group called With You, With Me. Veterans are recruited and retraining into civilian careers where there are skills gaps. This month, a squad of 10 veterans joined our IT department and will stay with us for 12 months.
TS: We have established industry-relevant projects with universities to give students the skills they need. I am grateful to Ai Group for facilitating the search and recruitment of the students and the support that we received, as well as from Defence SA.
I had some intern students last year who were identified through Ai Group, and I ended up hiring one of them. Others went on to further study.
Sponsoring these projects and mentoring people for a prolonged period of time is the way to go. The students get first-hand experience and can relate what they learn at uni. They can see what it takes to build systems.
They often lack confidence because the information doesn’t come from lecture slides and the answers are not always there, but we encourage them to think for themselves about how they are going to solve problems. We are there to guide them.
Establishing more of these programs will give students early exposure rather than when they enter the market, or when they search for a job. We need to build that pipeline.
I want those students to feel they can go to any other employer with confidence and relevant experience.
ML: How important are short courses in bridging the skills gap?
CR: Shorter-term skilling is something that everyone needs to be looking at to keep up with the pace of change and to keep employees motivated and relevant.
AN: We have implemented short courses into our programs for safety and leadership & development.
TS: I find it beneficial to put employees in contact with people from other parts of the organisation who can guide and upskill them in areas in which they lack confidence. These relationships and this network helps training your own workforce.
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Wendy Larter is Communications Manager at the Australian Industry Group. She has more than 20 years’ experience as a reporter, features writer, contributor and sub-editor for newspapers and magazines including The Courier-Mail in Brisbane and Metro, the News of the World, The Times and Elle in the UK.
