The five themes of the Jobs and Skills Summit
The Jobs and Skills Summit will take place on 1 September 2022 and bring together unions, employers and Government to discuss economic challenges facing Australia and possible long-term solutions. This article summarises the Issues Paper that was released by the Federal Government about the Summit, and also comments on likely reforms of enterprise bargaining.
The Summit will cover five broad themes.
Gaining full employment and growing productivity
The Issues Paper makes the point that to support full employment, stronger economic growth and increases in real wages, productivity need to be prioritised. Productivity growth has been low in Australia, at 1% per year since 2004.
Accordingly, one of the questions to be considered by the Summit is: how can Australia best take advantage of structural changes like digitalisation, climate change, the shift to renewable energy and growth in the services and care economy to boost productivity?
Boosting job security and wages
The Issues Paper also raises that enterprise bargaining should be a key enabler of both productivity growth and secure, well-paid work (it is the main opportunity Award-based employees have to significantly increase their wages). However, the proportion of employees covered by enterprise agreements has decreased from a peak of 43.4% in 2010 to 35.1% in 2021.
The ACTU has proposed industry-wide, or multi-employer, bargaining to boost wages, and that employees be able to take industrial action, without the need for secret ballots. Recently, the ACTU and the Council of Small Business made a joint statement supporting multi-employer agreements.
It is likely we will see changes made to simplify the enterprise agreement approval process, which may include reform of the BOOT test. These changes will be designed to make enterprise agreements more attractive to employers and boost the number of employees covered by them. It also seems inevitable that the ability of employers to unilaterally terminate enterprise agreements will be curtailed.
Further, 23.1% of Australians are employed as casuals, while 7.8% are engaged as independent contractors. It seems quite likely we will see the FWC’s powers extended to set minimum standards for those in “employee like” work, such as in the gig economy. The Government has also flagged further changes to the definitions of casual and contactors.
The gender pay gap in Australia, which is currently 13.8%, also needs to be addressed.
Lifting participation and reducing barriers to employment
The Issues Paper suggests that addressing barriers to employment can help individuals gain work relevant skills when they enter the workforce or after an extended period of under- or unemployment. For employers to benefit from the full diversity of talent available, improvements to foundational education, training practices and policy incentives will need to be explored.
Delivering a high quality labour force through skills, training and migration
The Issues Paper reflects that Australia’s skills and training system has not adapted to meet the needs of the economy. For example, 42% of technical and trade occupations are currently facing a skill shortage, compared to 19% for all occupations.
Well-targeted migration can help boost the workforce and economic growth, but the point is also made that Governments, industry and unions all have a role to ensure that migration is a compliment and not a substitute to properly training local workers.
Maximising opportunities for industries of the future
The Issues Paper states that maximising opportunities from new, growing and strategically important industries, including renewable energy and the digital and care economies, will be critical for boosting productivity. The health care and social assistance sector has doubled in size over the last 20 years, rising from 10-15% of the workplace. Growth in demand for critical minerals is expected to increase six-fold, with Australian Lithium exports expected to more than double between 2021/2 and 2023/4.
Demand for green products will also change the economics of manufacturing in Australia, with onshore production of lower-cost renewable energy (such as hydrogen) becoming more attractive. This will create significant opportunities for regional Australia and workers in regional communities.
Gilchrist Connell will be keeping clients up to date about the legislative changes flowing from the Summit, though our seminar series and LinkedIn posts.