Australasian Dentist Magazine May June 2021

Category 130 Australasian Dentist C onsider this … the pool of workers in Australia is roughly about 13.58 million people. Factor in the time is takes to grow a workforce of this magnitude. The slow rate in which babies are born and low levels of immigration. In this scenario, if there is a shortage of skills in the economy, workers with those skills are more valuable. Those workers then have more bargaining power demanding higher wages. As the economy grows and unemployment decreases across a range of industries, the bargaining power of lots of people will increase, and eventually, employers will have no choice but to pay higher wages. What will employers do? One solution would be to ask the government to increase the supply of labour. That way, labour supply would increase therefore providing more workers for employers to choose from. And employers would want this year after year. Skills shortages would disappear and employee bargaining power would decrease. This is a very simplistic scenario of what Australia has experienced over the last 25-30 years. Australia’s Immigration intake began increasing in the early 2000’s and has been maintained by all governments since that time, increasing by 46% in the 20 years since. Over the same period, Australia’s population grew by roughly 30 per cent, so the labour force increased at a faster rate than the overall population. What is happening at the moment is somewhat of an experiment. We had a snap border closure shutting off us off from the rest of the world therefore cutting supply of labour. Between April and September of 2020, net overseas migration to Australia declined by over 40,000 people, meaning more people left the country than arrived. With migration disappearing, Australia’s population grew by just under 24,000 people over the period. So, the question is, what will happen if borders remain closed for a couple of years? I don’t think anyone would have thought that one year ago that our borders would still be closed a year later, and we would be anticipating an extended closure possibly for another year. While there are definitely winners and losers in the labour market, shortages are slowly starting to appear in various sectors – including dental. There should be some cross-over of candidates moving in between industries from less-in-demand to those where shortages exist. Roles that are more technical in nature are vulnerable, as are areas of the medical industry and certainly in the dental industry. In my last article I discussed the increased demand for labour within the dental industry and wondered what, if any impact that would have on wages. Job ads in our industry are still significantly higher today then pre-covid levels. We are definitely seeing upward pressure on wages and are finding even within our business that we having to negotiate more frequently to get candidates working. Less experienced candidates are demanding higher wages, not always successfully, however sentiment is definitely changing. And we are really only just going into our second year of closed borders. While the government is issuing new COVID visas for some people to stay longer, we still have a situation where more workers are leaving than arriving. We also have a full year now of potential workers who would be commencing study or working holidays, who are not. The effects of that will be felt more so in the coming 6-12 months. So, what happens when our borders reopen and labour increases remains to be seen. I don’t think anyone can really predict at this point how skills shortages will manifest themselves this early on. Ultimately, pockets of wage growth here and there are inevitable. u Border closures driving wage pressure Why closed borders mean you may have to give your employee a pay rise By Pam McKean Director, AB Dental & Medical employment Agency columnists Pam McKean 2021 DATES 19 June 24 July 11 September TIME 9:00am – 4:00pm VENUE Brisbane CBD ADA VB, South Yarra ADA NSW, St Leonards