People & Human Resources

Michael Phillips

SmartCompany /

‘Skills shortage’? No, just a normal lag to recent ‘growth’. The way things are going, employers will soon have too many ‘skilled’ choices.

Skills shortage

Michael Phillips

For those of you who have been reading my blogs (that’s you mum), you will note a certain cynical tone throughout my rants. I might be a bit young at 29 to be cynical, but it’s hard when the world is such a fear-generated soap opera.

My particular favourite is the media, and the advertisement for Centrum – a multi-vitamin tablet. You know the one with the tag line of “Are you feeling 100%?”

Well no, I’m not feeling 100% and can’t remember the last time I did. I’m probably around 98%; so you know what? I better get some Centrum, that’ll fix it. Fear-generated marketing at its best.

The thing that has got me this week (other than the ridiculous discussion group “Kevin 07” has managed to put in place for deciding the country’s future; I mean really, you elect a Government to make decisions and then they create tea parties to decide on the future… talk about handballing responsibility– anyway, I digress…). My concern at the moment is the ongoing discussion about the “skills shortage”.

The problem we have in society today is that we over-analyse everything. We wonder why normal events occur and then spend millions establishing think tanks, discussion groups and micro-managing irrelevant issues.

Now, while the apparent skills shortage is not irrelevant, as a lot of small to large businesses are finding it difficult to recruit capable personnel, it is a “normal” event that unfortunately occurs from time to time. Let’s not spend too much time and money analysing why, because by the time we’ve worked that out, the problem will have eroded.

You only have to look at any particular growth phase in the economy over the last 150 years and you’ll see that along with that growth came a skills shortage. We have experienced a phenomenal boom in the last 10 to 15 years, and as a result demand in general is outgrowing supply.

Demand for goods, services and just about everything has multiplied, while on the supply side, businesses, infrastructure and systems have tried to catch up. As this is reactive rather than proactive, there will always be a time lag.

Once again, government has a lot to answer for, but good luck getting them to look beyond the next election.

So don’t be too dismayed, as supply will catch up with demand and this will filter through the economy. In particular, to the small business owner, this means it will carry through to the employment market and straighten out the apparent “skills shortage”.

With rising inflation and interest rates, among other things we’ll see rising constraints on the consumer and economy. This will bring unemployment levels back to “normal” levels, meaning job security will become a bigger issue and the level of employee turnover, wage increases and labour demands will decrease. So rather than a skills shortage we’ll be back where we were in the 1980s – battling to find a job, holding on to one when we get it, and the employer will have the upperhand.

All part of the economic cycle if you ask me, so save your money on investigating why and either put it towards a holiday, save it for the inevitable economic crunch, or contribute to benefiting climate change.


Michael Phillips is a 29-year old CPA managing a business full of Gen-Ys. He’s the Commercial Manager of Cremorne Group which wholesales and retail mens and womens apparel, including the Tommy Hilfiger, Blazer and Perri Cutten brands. He offers his experience as a pioneering Gen-Y managing Gen-Ys, covering issues such as how to recruit, retain and get the most out of Gen-Y – the notoriously difficult younger generation of employees aged 15 to 30.


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