Press Release - March 2007 PDF Print E-mail
Sending Jobs offshore is NOT the solution to the current skills shortage

In the same week that the ANZ job ad series results showed job ads increasing by 3.4% for February and the Bank's head of Australian economics claims “This would normally point to an acceleration in employment growth over coming months. However, the capacity of an already tightly stretched market to provide the required employees may moderate the pace at which employment can grow.” Combined with today's ABS feb labour figures showing that seasonally adjusted employment increased by 22,000 full-time employees.

While government and business will inevitably try to use these figures to justify outsourcing more Australian jobs overseas, Two of Australia's recruitment industry pioneers are calling on industry to meet the worsening skills shortage head-on.

The increasing shortage of skilled professionals in Australia needs to be tackled head-on by the Government, Business, Unions and other stakeholders to ensure Australia remains globally competitive, and that maximum economic and social benefit is realised for the Country during these 'boom times',” says Andrew McCarroll, Joint CEO and Director of 3W, a Contracting, Recruitment and Consulting Company specialising in skilled IT and Engineering professionals. “There needs to be an integrated strategy that combines, amongst other elements, an increase in skilled immigration and a long-term view to the development of our home-grown talent.”

The skills shortage should definitely not be used as an excuse by corporations for sending elements of their operations offshore,”  says Bruce Mills,  the other CEO of 3W. “By solving the skills shortage, and increasing the size of the Australian workforce, there are many benefits for companies, the economy and the population at large,” states Mills.

Australia should collectively draw a line in the sand. Pick the industries and skills that, as Country, we want to be considered to be the global experts in, and then work like mad to be the best,” continues McCarroll.

As part of this strategy, Government and Business in Australia should be wholeheartedly embracing the hiring of skilled employees from overseas to help achieve it. If they can't make it work then they should be enlisting the help of organisations with specialist skills and experience in doing so.  The government, unions and industry bodies should be working together to do everything they can to help too.  It is naive and absurd in today's global skills market to think it too difficult to attract and hire skilled talent for Australia or conversely (as is the position from many employee groups) that this is taking job opportunities away from Australians. The flow on effects of attracting talent outweighs any negatives.  Skilled employees are crucial for government and business to achieve their strategic, financial and social objectives.  Talent hired from offshore either on temporary working visas or as permanent residents bring many benefits:  they pay direct and indirect taxes,  they pay full fees at government schools and universities, they are consumers that spend money in the local economy on food, cars, accommodation, living expenses, entertainment, financial services etc.  And they can also transfer their knowledge to the local workforce.  Think of the impact on GDP if Australia's booming Industry Sectors could achieve close to full employment without poaching from within the Country.

A study by the Australian Government Productivity Commission in 2006 highlighted the positive potential benefits for the economy of increasing skilled migration. These include: an increase in the skilled composition of the workforce, an increase in income per capita, increases in productivity and subsequent living standards, increases in economies of scale as a result of a larger population, an increase in income tax revenue, more trade and technology transfer opportunities leading to an increase in exports. (see footnote 1.)

Look at the stark realities that Australia now faces.  Outsourcing of jobs (along with all of the flow-on benefits of employing people in this Country) is happening today and it is a growing trend.  Companies such as Qantas are aggressively outsourcing their operations offshore to countries like India and Thailand. Services outsourced range from IT to aircraft maintenance to crew.  Every major bank has either outsourced or is looking to outsource elements of their operations such as IT to India or other "cheaper" alternatives.  Other industry sectors are sending back-office processing offshore. Don’t just consider the direct loss of jobs as the by-product of offshore outsourcing. What happens to all of the direct and indirect flow-on effects of a locally employed workforce when it is relocated to Bangalore?  No tax revenue from the employees or the employer.  No flow on benefits for the local economy in terms of housing, consumer spend etc.

McCarroll says it is now too late and too little action is being undertaken by Governments and Business in this country to depend solely on the domestic workforce for the future.  It is very important to foster and grow the local workforce,  but global economic growth and the rapid change in industrialised countries' population demographics call for a broader, integrated strategy. Hence the Government, business, unions and other industries groups should as part of the Country’s growth strategy be working together to aggressively target and attract skilled professionals to Australia. Their skills should cover the broad spectrum of industries and professions that are suffering from the effects of underemployment. But this should be but one of the planks in the Country’s approach as a whole to its future growth. More needs to be done to foster and develop Australia’s home-grown talent.

Besides, some of this Country’s greatest capital intensive projects would not have been possible without skilled immigration. Some historians and sociologists will even argue that part of this Nation’s social fabric evolved from these events.

Maybe Australia could benefit from entering a modern-day Snowy Mountains Hydro Scheme type approach to building a skilled workforce.

About 3W

3W is a Consulting, Contracting and Recruitment company specialising in providing government and corporate clients with IT, Engineering and Executive resources. 3W recruits locally from the Australian talent pool and more specifically for Australian based clients, extensively from the offshore global skills pool. Resources are either hired directly by 3W, relocated to Australia and contracted to clients or hired directly for end-clients, with 3W managing the recruitment process through to post delivery support.

Andrew McCarroll and Bruce Mills are Joint Chief Executive Officers and Directors of 3W. They have a combined 30 years plus in the consulting, recruitment and contracting industries. Between them they have hired more than 1,000 professionals from overseas and delivered them to clients under the Australian Department of Immigration, Multicultural and Indigenous Affairs’ various Skilled Immigration Visa schemes.

For further information please contact Andrew McCarroll on 0437 712 373 or Bruce Mills on 0433 112 367.

Footnotes
  • Economic Impacts of Migration and Population Growth. Productivity Commission Research Report 24 April 2006. Australian Government Productivity Commission
  • ABS – Australian Bureau of Statistics - 6202.0 Labour Force, Australia, 2007
  • 2007 ANZ Job Ads – 13 March, 2007
 
 

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