When the Federal Government was elected, it promised to invest in infrastructure development in order to create jobs.
More recently, the states have matched those promises to boost job creation and overcome job losses caused by the decline of old industries and jobs across the resources sector. In addition, the 2015 federal budget saw the government set aside $45 million for local infrastructure projects.
Investment in ports, roads and rail are seen as a solution to job creation across the country. Tasmanian Premier Will Hodgman stated after his government's recent budget commitments that “If you wear a Hi-Vis vest, we want you, and your family, living and working in Tasmania.” And he’s not the only one looking for skilled workers, as many other states fight it out for top talent.
This is good news for workers across this sector but as we look at the entire country some states have performed better for jobs than others. New South Wales has been the clear winner with its long term investment in infrastructure. The Northern Territory and North Queensland are also set to benefit from infrastructure projects, as the federal government has committed to open up the north to take advantages of the opportunities in China and the rest of Asia. Western Australia has a steady flow of infrastructure projects taking place, as it looks to transition away from a resources driven economy.
Victoria appeared to take a step backward earlier this year when it tore up the East/West Tunnel contract, impacting up to a reported 7,000 jobs, but its commitments to improving the public transport network and removing level crossings will go some way to help fill the jobs gap the tunnel cancellation left.
If we look to South Australia, there is little to be optimistic about right now, with June unemployment figures hitting a 15-year high for the State at 8.2 per cent (the highest unemployment rate in the country). And whilst it is true the government is eying a number of potential projects, it has yet to commit to anything significant that is likely to have a real impact on jobs for the state. This could potentially see an exodus of workers to other states where projects are already underway or are fast becoming “shovel ready.”
This investment in nation building whilst creating jobs is also creating a shortage of experienced workers. This is already presenting challenges for some employers and the problem will only get worse. Some of the roles in highest demand include:
- Civil engineers
- Project managers
- Civil drafters
- Contract managers
- Civil labourers
- Rail engineers
It is highly likely that in the coming months and years, we are going to see large scale infrastructure projects impacted by the kind of wage pressure we saw in the mining industry, during the peak of the resources boom when demand outstripped supply.
In the Northern Territory, as an example, workers are already aware of the over demand. According to Randstad’s Workmonitor Report, when asked whether workers could find other jobs or comparable jobs, 100 per cent said they could - the highest percentage across Australia. This will only drive wages up as workers become more aware of the skills shortage and take advantage of the demand.
Couple this with the fact the Northern Territory’s unemployment rate is now a low 4.5 per cent and the participation rate (the number of people available to work, who are looking for work) is the highest in the country at 76.3 per cent, and the state has a real challenge on its hands. With a small pool of workers in the Northern Territory to choose from, firms competing for the infrastructure projects across the North will need to look further afield to find its workforce, the very people Premier Hodgman would like to attract to Tasmania as well.
The question is, will workers be happy to relocate to another state, as Australian workers have traditionally been less mobile than others around the world? New South Wales has recently announced a new $2.8 billion intercity trains fleet, which will link Sydney with areas such as the Blue Mountains, the South Coast, the Central Coast and Newcastle. With a number of projects already underway and many more coming down the pipe, workers have no reason to leave the state and relocate to find work.
South Australia is looking like the most likely target to attract skilled workers from, what with it having the highest unemployment rate. However, the state has recently announced a $300 million development of the Adelaide GPO precinct, creating 500 construction jobs. So many of its skilled workers may stay in the state to compete for that work.
The alternative solutions are either to bring in foreign workers, with the Northern Territory Government welcoming the Commonwealth’s proposals to lift the cap on the number of workers from overseas, or to upskill local workers.
Queensland has already announced a $750 million vocational education and training package, which includes reinstatement of Labor’s $60 million Skilling Queenslanders for Work program. This will be key to driving jobs growth and ensuring the workforce has the right skills to transition from a resource focused market. Whether the Northern Territory takes this route or continues to support bringing in foreign labour is yet to be seen, but that debate will continue for some time.
With infrastructure projects continuing momentum in major states and Northern Territory and Tasmania crying out for skilled workers to kick start their projects, it looks like workers aren’t going to be short of jobs anytime soon. It’s going to be a competitive market and it could be expected Northern Territory and Tasmania will start putting forward very appealing offers to encourage skilled workers to relocate.