Forecasting labour shortages in the Australian economy

Janine Dixon

Centre of Policy Studies/IMPACT Centre Working Papers from Victoria University, Centre of Policy Studies/IMPACT Centre

Abstract: Labour shortages have the potential to hamper the ability of the economy to produce the combination of goods and services desired by population. Labour shortages are typically quantified though analysis of the number and duration of job vacancies, and surveys of employers. Here we use an economy-wide model of the Australian economy to forecast labour shortages over the next two years. Labour shortages are indicated in the model results by occupations with strong wage growth, which suggests that shortages would develop in these occupations at the current wage. Most occupations anticipated by the model results to be in shortage by 2024 require vocational education, while occupations in strong supply tend to require higher education. Leading up to the 2022 Australian Jobs and Skills Summit this suggests an important role for the VET sector in training the workers required to avoid labour shortages.

Keywords: Labour shortage; Skills shortage; Dynamic CGE modelling; Australian labour market (search for similar items in EconPapers)
JEL-codes: J11 J21 J23 J24 (search for similar items in EconPapers)
Date: 2022-08
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