While manufacturing in Australia isn’t at the levels it used to be, it still plays a significant role in Australia’s economy. The manufacturing industry in Australia is diverse and covers a wide range of sectors.
Like many industries in Australia, the manufacturing industry is experiencing a labour shortage. Many industries that have experienced labour shortages have had the benefit of being able to employ overseas workers though labour agreements, however, the manufacturing industry does not have a labour agreement in place.
What is a Labour Agreement?
A labour agreement is a formal contract between Australian employers and the Australian Government. The agreement allows businesses to sponsor skilled foreign workers for a skilled visa where temporary or permanent visa programs are not available. Skilled workers are able to work in Australia for a specified period, in an approved occupation.
Labour agreements are generally in effect for five years and are designed for businesses that have a genuine need to hire skilled overseas workers for positions that cannot be filled by Australian workers.
Labour agreements are usually granted under one or more of the following visa programs:
- Skills in Demand (SID) Visa (subclass 482)
- Employer Nomination Scheme Visa (subclass 186)
- Skilled Employer Sponsored Regional (Provisional) Visa (subclass 494)
A Snapshot of the Manufacturing Industry
The Australian manufacturing industry employs approximately 875,000 workers and supports a wide range of industries including food and beverage, pharmaceuticals and advanced machinery.
While the manufacturing industry contributes greatly to Australia’s economy, it’s facing many challenges which include:
Attraction and Retention of Apprentices
Due to a lack of understanding and awareness of the career pathways available in the manufacturing industry, it fails to attract and retain apprentices. Manufacturing is still perceived as a low-value industry among young people.
Aging Workforce
The manufacturing industry is made up of an aging workforce with the median age of employees being 42 years of age. As specialised tradespeople approach retirement, they take with them the specialised skills needed within the business.
Emerging Skills, Occupations and Industries
The manufacturing industry is lacking skills development. With the adoption of advanced manufacturing, the industry requires its workforce to have future-focused skills that will adapt with the changing needs and skills of the industry.
How the Manufacturing Industry Could Benefit from a Labour Agreement
Manufacturing isn’t the only industry to suffer from skills shortages however, other affected industries such as fishing, aged care, meat, horticulture and many more have industry labour agreements in place.
Australia’s 2024 Manufacturing Workforce Plan was developed by the Manufacturing Industry Skills Alliance. It outlines a strategic response to workforce shortages in the manufacturing sector, which is projected to require an additional 120,000 workers by 2033. This equates to a 16.8% increase, but how will they hit that target? It seems that a manufacturing labour agreement could be one of very few options to increase the manufacturing workforce.
Given the challenges faced by the manufacturing industry, a manufacturing labour agreement could help future-proof the industry.
Another Election Issue
With a federal election on the horizon, there’s a possibility that a manufacturing labour agreement may be considered. While the impact of a labour agreement on the manufacturing industry would be the priority in making the decision, the impact a manufacturing labour agreement would have on the Australian economy will also have a big influence on whether a manufacturing labour agreement is developed.
To learn more about labour agreements or any aspect of immigration, contact the experienced team of registered migration agents at Visa Solutions Australia. Book a consultation.
