Workforce shortages in Victoria have eased slightly from their peak but remain elevated. In May 2023, the job vacancy rate in Victoria was 2.8% (or 105, 100 job vacancies). This is below the historical high of 3.5% in August 2022 but above the three-year pre-COVID-19 average of 1.7% (Figure 1.3).6
The increase in the job vacancy rate since mid-2020 coincided with a sharp increase in the proportion of employers who were seeking to fill jobs but faced recruitment difficulties, which increased from 33% to 65% between September 2020 and March 2023.7
Tight labour market conditions are also illustrated by the falling ratio of unemployed persons (that is, labour supply) relative to job vacancies (that is, labour demand) in Victoria (Figure 1.4).8 This has been the case since May 2020, falling from a 24-year high of 8.1 (unemployed persons per vacancy) to a record low of 1.1 in May 2022. While it increased to 1.3 in May 2023, the number of unemployed persons remains close to the number of job vacancies.
Data on occupational shortages presented in last year’s Victorian Skills Authority State of the Victorian Labour Market(opens in a new window) report (using data from the (former) National Skills Commission’s Skills Priority List) were the most recent estimates of occupational shortages at the time of preparing this report.9 The data showed that a total of 143 unique occupations were in shortage across Victoria, with the construction sector having the highest number of occupations in shortage. The updated Skills Priority List prepared by Jobs and Skills Australia was released on 4 October 2023, after the finalisation of this report.
7 Jobs and Skills Australia, Recruitment Experiences and Outlook Survey, May 2023. Recruitment difficulty rate is defined as the proportion of recruiting employers who had recruitment difficulty.
8 While the number of unemployed is very close to the number of job vacancies, this does not necessarily mean that the unemployed can fill these vacancies due to skills gaps, lack of proximity to jobs, etcetera.
9 A shortage exists when employers are unable to fill or have considerable difficulty filling vacancies for an occupation at current levels of remuneration and conditions of employment, and in reasonably accessible locations.