67% of Aussie SMBs Struggling to Fill Open Job Vacancies

9 January, 2023

17 mins read

Australian Businesses Struggling to Fill Open Job Vacancies

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Are you having trouble hiring new staff or finding skilled workers to fill specific positions? It turns out you’re not alone.

A new report by digital marketing service Localsearch has revealed 67% of small-to-medium businesses (SMB) in Australia are struggling to find the right talent to fill open job vacancies.

This comes as the Australian Bureau of Statistics (ABS) reports a 10.5% in public sector job vacancies in the last 12 months.

However, what impact is this on SMBs, especially those experiencing growth?

The below reveals the answers to these very questions and what you can do about it if you’re struggling to fill vacancies at your business.

P.S. Subscribe to the Localsearch Digital Newsletter and receive the full copy of the 2022 Australian Business Survey for free.

What is a skilled worker shortage?

A skilled worker shortage (or skilled labour shortage) is when there are not enough workers with specific skills needed to fill vacant jobs. Shortages of skilled workers can be caused by anything from regional-specific jobs in remote areas and not enough educational resources to economic impacts, like wage limits.

60.7% of respondents in Localsearch’s 2022 Australian Small Business Survey said skilled worker shortages are impacting their day-to-day operations. Further to this, 43.8% of respondents said the lack of skilled workers is impacting their growth and expansion. Only 8.9% of respondents are experiencing no impact at all.

As you can see, a shortage of skilled workers greatly impacts our country’s supply and demand. So, what can we do about it?

60.7% of businesses say the skilled worker shortage has impacted their day-to-day operations.

Is there currently a skilled worker shortage in Australia?

With 74.1% of 2022 Australian Small Business Survey respondents reporting their biggest hiring problem in 2021/2022 is a lack of industry-experienced workers, it’s safe to say Australia has a shortage of skilled workers.

Respondents also reported:

  • 36.6% said there are not enough skilled workers for high-level jobs.
  • 33% said the skilled workers they find are expecting higher-than-average salaries.
  • 21.4% said the majority of their job applicants are fresh out of high school or tertiary education but lack industry experience.

From 2020 to 2022, we saw a unique situation where many workers were required to work from home or jobs were not available in some of the more heavily restricted areas. This then opened more options for people to accept higher paying jobs in other regions or to move to where there was available work. Post-pandemic, this has then left the restricted or impacted regions with fewer workers available or people seeking higher-paying roles.

With only 3% of small businesses reportedly looking to reduce their staff numbers in the coming year and a whopping 42.1% of businesses looking to increase staff numbers, the problem isn’t likely to get better anytime soon.

Who is most impacted by the skilled worker shortage?

According to Localsearch’s 2022 Australian Small Business Survey, it’s believed Trades are the most impacted industry by the skilled worker shortage, followed by:

  • Health sector.
  • Hospitality and retail.
  • Finance.
  • Marketing.
  • IT and technology.

Outside of skilled labour shortage, businesses also reported the following issues impacted their hiring in the past 12 months:

  • 49.7% said they don’t have enough time, money for pay and other resources to hire more staff needed to fulfil growth or expansion.
  • 19.9% of businesses claimed the positions they need to fill aren’t attractive enough for the right people.
  • 21.1% of businesses reported not needing new skilled staff at all.

With most businesses reporting spending 1 to 5 hours on hiring new employees, with 17.9% saying they spend more than 20 hours on hiring, the labour shortage is creating more issues than just a lack of workers.

So, if you’re one of these businesses struggling to fill open job ads, here are some tips to help you attract the right talent.

49.7% of businesses say they don't have enough time, money or other resources to hire new staff.

7 Tips for Attracting Skilled Workers to Job Vacancies

1. Spruce up your job ad. 

If you’re finding it hard to find the right workers for an open position, chances are, so is your competition. So, you need to stand out in the best way possible to attract those job hunters to your ad.

Good things to include in job ads include:

  • Salary range.
  • Any opportunities for training, progression, etc.
  • Employee benefits.
  • Job hours and any flexible working arrangements.
  • Defining any essential criteria versus preferable criteria that will help applicants stand out.
  • Link to employee reviews.

What makes your business so great to work for? That’s what you need to put in your job ads.

2. Consider changing worker benefits to meet current needs.

Working from home means more employees can work for nearly any business in the world. Even hybrid working arrangements mean people can travel and work when they’re not required in the office. This means, for your business, being able to switch up how you think about hiring may give you more options.

For example, 44.6% of small businesses reported now hiring based on work ethic over work experience. Of course, some skills are required, but it may mean considering taking on a junior or entry-level worker over someone with all the skills required. In fact, 40.2% of businesses report taking on more junior staff with the intention to train.

Further to this, 43.8% of business owners report offering higher salaries to in-demand talent, while 25.9% are offering greater work/life balance incentives, such as working from home, flexible working hours and social activities.

What all of this means is nearly half of small-to-medium businesses are changing something about their work to fill open job vacancies. As a result, it may mean taking some time to investigate current job openings in your industry (not only in your area but in metro areas too) to see what is on offer for workers. Then, you can see what you can do within your own business to attract new talent.

Remember, if you introduce new benefits for staff, include them in your job ads!

3. Expand your geographical prospects, if possible. 

Only 19.6% of businesses are sourcing their talent not based on geographic location. Now, of course, not every business can offer work-from-home or flexible working arrangements to venture into a borderless staff structure.

However, there may be a potential to offer fly-in, fly-out (FIFO) working arrangements or to advertise out of your direct area and offer to pay some or all of the relocation costs for the right person. Running job ads outside of your direct area is like fishing in a lake instead of a puddle — you simply have access to more people, increasing your chance of more job applicants.

You may even wish to investigate what jobs in your industry are available in different areas and advertise in regions where there are a low number of jobs in your field to attract those hunting in that area.

19.6% of small businesses are hiring outside of their geographical areas

4. Offer incentives for staff to upskill. 

56.6% of business owners say they are offering to up-skill current employees to fill higher-skilled roles internally. This included:

  • Training for new products or training.
  • New certification training.
  • Creating an in-house training and compliance team.
  • Technology training or certifications.
  • Leadership training.
  • Cross-skilling of teams and departments.
  • Providing access to formal education (such as university).

There may even be State Government subsidies or grants to help fund these initiatives, so it’s worth investigating, particularly if you’ll be taking on apprentices or trainees. This is where a recruiter may come in handy.

5. Use an industry-specific recruiter. 

If you have limited time to invest in recruiting, a recruiter may be your best friend.

Recruiters can not only run job ads for you, but they can also narrow down applicants and run pre-assessment interviews for you. As recruiters are typically only paid once an applicant is successful (and sometimes not paid in full until after probation has been passed), they want to find the right fit for your role.

Now, recruiters not only run ads to find talent, but they also go on the hunt for them too. This includes trawling forums, LinkedIn, business websites and blogs, or even their own database of contacts. If you are struggling to find the right talent, this resource is invaluable and may save you weeks, even months or years, in filling that crucial job.

Be sure to check out recruitment agencies near you on Localsearch.com.au for a list of businesses near you and reviews from their clients.

6. Run paid ads for recruitment. 

You know how paid ads are great for putting you in front of customers? They can be great at finding employees too!

Instagram stories and Facebook Ads are common practice for creative job ads, but LinkedIn Ads can do the trick too. You really want to make your ads stand out and entice people. It’s not enough to simply say ‘Want a job in IT/construction/marketing/real estate/whatever it is you do?’.

A video ad can really help you stand out to scrollers, even if it’s you walking through your workshop, talking about why your workplace is so great or a montage of your team. For a simpler ad, make sure your text pops and use your branding colours to make it align with your business.

P.S. if you need help with social media ads, get in touch with Localsearch for a free quote. We’d be happy to help.

7. Nurture your existing team. 

Your employees are the best advocates of what it’s like to work for your business. Their reviews on employee review platforms, like Seek and Glassdoor, can greatly impact your ability to attract the best talent. Plus, retaining your team is always a good thing.

However, outside of your team helping you with your brand presence, you can also tap into their connections. Chances are, they have worked or trained with others in their industry, so may know someone ideal for a position you have available.

Many workplaces will put incentives in place for staff who successfully refer someone who fills an open position. For example, you may give them $200 or a $50 gift card.

Posting company culture on social media and encouraging your staff to share is another great way to show what a great business you are to work for.

Remember, you can download Localsearch’s full 2022 Australian Small Business Report for free for more insights into the current economy in regional Australia.

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