During June this year, accountants along with other occupations were added to the Priority Migration Skilled Occupation List (PMSOL). This inclusion indicates there is insufficient accountants in the Australian market, and the forecast new accountants will be insufficient in the near term i.e. new accountants from universities or other related industries such as bookkeeping.
The Australian accounting labour shortage has failed to show indications of improving. According to statistics, the level of job vacancies is at its all-time high. Firms are increasing compensation by up to 25% to attract and keep employees, yet they are still unable to fill vacancies. Even with “sign-on bonus” and other inducements, some business owners find that no one shows up for an interview.
So the question to ask is why staffing issues continues to happen despite the open borders and the new regulations?
Here are just a few key factors to consider.
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More “Exits” than “Enters”
From 1 November 2021, Australia started to ease international border restrictions after the 20-month ban. During this initial phase, allowing Australians to enter/leave the country takes precedence over allowing foreign visitors (tourists, seasonal workers and students) to enter.
Consequently, people who have been eager to get away for holidays or reunite with families have already booked tickets, made plans, and packed. On the other hand, people who have been looking forward to re-entering Australia (like foreign workers, international students, etc.) remain on the waiting list.
Especially with state borders being unpredictable, along with rules within the states being fluid, we will continue to see empty streets in Australia. It is predicted that there would be 900,000 fewer people living in Australia by 2025 than was expected before the pandemic, given reduced immigration during the 2 years of the pandemic, reduced international students, as well as reduced family sponsored reunions.
Working holidays – an emerging trend among Aussie professionals
According to research carried out by PwC and Deloitte, 4 out of every 10 Australian workers are thinking of switching jobs. It seems that the pandemic has given everybody a sufficient time to reflect on themselves and their career. More workers, especially the younger generations, have been looking for a fresh start. Now, with the borders opening up, the idea of “working holiday” (or gap year, or just time off and out of Australia) is increasingly more popular among young professionals. Additionally, many older accountants are thinking early retirement and a trip overseas may be better done now than in the future.
Working holidays are usually done by younger accountants, and many overseas countries are actively attempting to recruit Australians. Interestingly, Aussie workers are in-demand worldwide as other countries are also suffered from labour shortage.
And with decreased travel due to international borders being still difficult to move through (PCR tests etc) and airfare expensive, it is likely Australians may extend their working holidays for longer than usually expected.
Global shortfall of workers
According to reports, labour shortages are being felt across the globe in many English speaking countries including the US, UK, Canada, and parts of European Union. The difference is that these countries began opening their borders since August 2021 and have been allowing outsiders to enter the country. As a result, recruiters from these nations have been reaching out to applicants from other countries, such as Australia, and offering positions to those who express an interest in changing occupations.
Skill shortages are so severe that firms from these countries are willing to conduct the interviews remotely for positions 4-6 months into the future. These firms are aware that there will be a processing delay and are therefore well-prepared.
The alternative to hiring for Australian accounting firms
All of this has resulted in one thing: Australia’s labour shortage is only getting worse! It’s an impractical approach if accounting firms continue to rely on the labour supply to clear backlogs and meet client turnaround requirements.
In these cases, outsourcing can be very beneficial because it relieves accounting firms of the stress of hiring and allows them to concentrate on other important tasks. Furthermore, by engaging with decent outsourcing providers, firms may profit from higher quality work and faster turnaround.
If you’d like assistance with a temporary or permanent skill shortage in your compliance team, reach out to Odyssey and we’ll be happy to chat about how we can assist!