Despite widespread claims of labour shortages in Australia, new reports suggest the issue is not a lack of applicants but a shortage of candidates with the right qualifications.
While migration has historically been viewed as a solution to workforce gaps, evidence indicates that many skilled migrants are underemployed, raising questions about the effectiveness of the system.
Australia’s labour market is witnessing an increasing number of job applications, yet hiring managers continue to report difficulties in finding suitable candidates.
At the same time, research suggests that many skilled migrants, who are expected to fill critical roles, are instead working in positions below their qualifications.
Job Applications Surge, but Hiring Challenges Persist
A report from JobAdder revealed that job applications in Australia rose by 47% in 2024, resulting in a record-high average of 41 applicants per job in the fourth quarter of the year.
Similarly, SEEK’s employment report found a substantial increase in applications per job advertisement, contradicting the notion that labour shortages stem from a lack of interest.
Despite these trends, Hays Recruitment reported that 85% of hiring managers still struggle with skill gaps. The issue, according to economist Greg Jericho, lies not in the number of applicants but in the lack of candidates who meet the required qualifications.
Moreover, the shift towards temporary employment has intensified uncertainty among job seekers. JobAdder noted that 81% of placements in 2024 were temporary roles rather than permanent positions, potentially limiting career progression and job stability.
Skilled Migration Failing to Meet Expectations
While Australia’s skilled migration program is designed to address workforce shortages, data suggests it is not delivering the intended results.
According to the Committee for Economic Development of Australia (CEDA), skilled migrants are frequently underemployed, earning significantly less than Australian-born workers and often working in jobs beneath their skill level.
Further research from Deloitte Access Economics found that 44% of permanent migrants were employed in roles below their qualifications in 2023, with an estimated 621,000 skilled migrants underutilised.
Adelaide University’s George Tan also reported that 43% of skilled migrants who entered through state-sponsored visas were not working in their designated occupation.
The federal government’s 2023 Migration Review further highlighted that more than half (51%) of overseas-born university graduates with bachelor’s degrees were in unskilled employment three years after graduation.
