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More companies name recruitment as their chief concern in 2023 ahead of inflation and supply chain issues, Ai Group survey finds.
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9 out of 10 businesses expect skills shortage to be biggest problem
20 January 2023
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Nine out of 10 businesses expect skill shortages to be their biggest problem this year up from 73 per cent in 2022, according to the Australian Industry Group (Ai Group)’s CEO Expectations survey.
The survey, of 280 private sector businesses across Australia, found the recruiting issue loomed larger than inflation or supply chain problems.
Ai Group chief executive Innes Willox said business leaders were bracing for an increasing struggle to find the right staff.
“An overwhelming 90 per cent of businesses expect to be affected by staffing shortages in 2023,” said Mr Willox.
“These are most keenly felt in higher-skilled occupations, but are evident across all skill levels, industries and geographic locations.”
“Finding and developing more skilled people locally and through immigration remains a central workforce strategy. For example 50 per cent of businesses said they would increase investment in staff training next year to deal with skills gaps.”
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Business leaders also planned to overcome shortages through operational changes, increased employee training and alternative use of technology.
Most businesses — 56 per cent — planned to raise their investment in technology while only 5 per cent expected to cut it, while 50 per cent said they would increase investment in staff training.
The Ai Group found that businesses were “cautiously optimistic” about the operating conditions for 2023, with inflationary pressures and supply chain disruptions the other main challenges.
“(Approximately) 49 per cent of business leaders expect conditions to be stronger in 2023 than 2022, but this optimism is tempered by a number of supply side concerns.”
Almost nine out of 10 businesses said they would invest in supply chain resilience in 2023 by improving their logistics practices, finding new suppliers, and adjusting product offerings to manage the challenge.
Mr Willox said the government needed to help businesses maintain productivity in the face of these headwinds.
“Our survey demonstrates that it will clearly be another challenging year for many businesses and the need for a relentless focus on productivity across the broader policy agenda has become even more important,” he said.
“The federal government in particular needs to put productivity and flexibility at the forefront, especially when considering the further changes to workplace relations it plans to introduce later this year.”
“We need to catch up on years of below-par productivity growth and we need to gear ourselves for at least a return to 1990s level growth.”
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