Energy, defence, medicines: How Australia can prepare for jobs of the future

Nine out of 10 new jobs in Australia over the past year were in occupations that typically require a qualification, prompting a federal cabinet minister to warn that Australia needs to invest more in education and training to boost the skilled workforce.

Skills and Training Minister Brendan O’Connor said the jobs of the future would be in renewable energy, the defence industry, the production of medicines and other manufacturing to make the country more self-reliant.

Skills and Training Minister Brendan O’Connor says 90 per cent of Australians will need to be in skilled jobs.Credit: Elke Meitzel

New data shows that over the past year, about 92 per cent of employment growth has been in occupations that usually require a tertiary or vocational qualification.

With only about 63 per cent of advertised job vacancies being filled, O’Connor said the data from the upcoming quarterly labour market report highlighted the need for the nation to invest in the right courses and training, including vocational education such as TAFE.

“Nine out of every 10 jobs in the future will require either a university qualification or a VET [vocational education and training] qualification,” O’Connor told this masthead.

“So if we don’t get our tertiary sectors right and we’re not investing in areas of future demand, then we’re not going to have those skills.”

Medical research is one of the sectors expected to create jobs in Australia in the future.Credit: Jamie Kidston

The government has been trying to address the skills crisis by overhauling the migration system to better target skilled migrants, as well as reform the vocational education sector.

O’Connor is in discussions with his state and territory counterparts on a $4.1 billion funding deal over five years to overhaul the vocational education sector, which he hopes will address the chronic shortages in the labour market.

The national skills agreement will include a $400 million commitment for 300,000 additional fee-free TAFE and VET places, as well as $3.7 billion for a range of other measures.

This will include new centres of excellence attached to TAFEs, which will partner with industry, universities and governments to address critical demands in particular areas of the country.

“It’s a work in progress but there are positive signs,” O’Connor said.

“I think we’ll see some vast improvements we can land this.”

O’Connor said a lot of the jobs shortages across the nation were brought about by the COVID-19 pandemic, but he believed the previous government’s lack of investment in skills and training, and its refusal to support to temporary visa holders during the pandemic made the problem worse.

“Every sector of the economy is feeling some shortage – whether it’s professions, traditional trades, the care sector, retail and hospitality, tourism,” he said.

Renewable energy is another potential growth area for employment.

“Wherever I look, there are shortages.”

He said the skills shortage had to be solved through migration and training, and it wasn’t a “binary choice”.

“We can’t be overly reliant on skilled migration pathways even though that will always be a feature of supplying skills to the labour market,” he said.

“It has to be a compact … our first priority has to be educating and training people who live here. If people know that you’re investing in the people here, people are very amenable and fully understand the need to have skilled migration pathways too.”

O’Connor said Australia’s energy grid needed rewiring to deal with renewables, and the jobs of the future would include those in battery storage and the new skills required to manage new energy sources.

He also said there were significant opportunities after the pandemic for jobs in “sovereign capability” to make the country more self-reliant, which included defence manufacturing as well as medicines.

“The pandemic did remind us that we shouldn’t be too reliant on supply chains and overseas markets. We should be capable of looking after ourselves to the extent that is possible,” he said.

There has been recent debate over whether artificial intelligence would eliminate the need for workers across a range of industries.

A new report by economics advisory firm Mandala Partners warned lawyers, management consultants, tertiary educators and logistics teams were among the Australian workers set to be most heavily affected by AI.

But O’Connor said technological disruption was “nothing new” and he was confident people would continue to be in demand if the nation invested in the right skills and training.

“For every loss of a particular skill in the economy, a new skill tends to emerge,” he said.

“As long as we’re ahead of the curve in anticipating the changing nature of the economy, we’ll do right by Australians who need those skills today and tomorrow.”

Cut through the noise of federal politics with news, views and expert analysis from Jacqueline Maley. Subscribers can sign up to our weekly Inside Politics newsletter here.