Australia is currently in the grips of one of the biggest labour shortages industries have ever faced. In May 2022, the Australian Bureau of Statistics reported the unemployment rate edged from 4% to 3.9%, a 50-year record low. This extremely low unemployment rate tells a clear story: Almost every Australian has a job. We know that in some regional and remote areas, the unemployment rate is less than 1%. Those who are not working either cannot or choose not to work. On the one hand, this is great news for the workforce. But it’s very bad news for businesses, particularly with so many unfilled jobs in the market.
There is a solution, and it lies in the Pacific Australia Labour Mobility (PALM) initiative, a scheme that came into effect in April 2022, but which streamlines and combines the established but previously separated Pacific Labour Scheme (PLS) and Seasonal Worker Programme (SWP).
The real impact of labour shortages
We’ve seen a range of tactics to from industries trying to address the problem. In October 2021, the Queensland Strawberry Grower’s Association ran a competition in which ten farm workers had a one-in-a-hundred chance to win $100,000. At a time when the industry was fearing its worst labour crisis on record, an innovative solution was developed to solve the situation.
Thousands of pickers and packers registered and the very real danger of ripe fruit rotting in the fields was avoided. Given that Queensland’s strawberry crop had a farm gate value of $435 million in 2020, it was a relatively low investment from the farmers.
But of course, not every industry can deal with our current labour crisis in the same way – or in such a newsworthy fashion. One of our key clients – and a supplier to some of our largest fresh food retailers – has resorted to selling their product wholesale because they do not have enough people to process it. What does this mean for their revenue model? Any business that sells a finished product achieves the greatest value maximisation through the process that creates that product. By selling their meat wholesale instead of as packaged products, our client is not only failing to hit their revenue targets, but they are unable to deliver a valuable product to Australian consumers or contribute more meaningfully to the Australian economy. Not to mention the food processing equipment and manufacturing floor space that is lying idle.
How did we get here?
We all know what happened. Our borders closed and seasonal workers left. It was a challenge we worked closely with our clients to manage, and we’ve all felt the effects, from food shortages, to rising costs, to restricted supply chains. What we didn’t expect was that once our borders re-opened… nothing would change.
The flood of people many pundits were expecting to return simply hasn’t happened and it’s having a significant impact on the recovery of the Australian economy – at least for the foreseeable future. And the backpackers and students who have returned are gravitating towards tourism and hospitality jobs.
What has quickly been forgotten in the wake of the pandemic, however, is that a tightening labour pool was already a problem before 2020. Sourcing unskilled and semi-skilled workforces from beyond Australia’s borders had become a critical factor in ensuring that industries could operate at full capacity and productivity. This is why the Pacific Labour Scheme (PLS) and Seasonal Worker Programme (SWP) were created in the first place.
However, the closed borders have exacerbated this situation. Healthy economies are built on healthy industries, which rely heavily on people. Without labour, industries and supply chains grind to a halt.
The good news is that the federal government has intervened again, putting a greater focus on the importance of Australia’s Pacific labour mobility approach through PALM.
How PALM can support the growth of Australia’s
The Pacific Australia Labour Mobility (PALM) initiative understands that to support local businesses, we need to connect them with dependable workers from outside Australia’s borders.
PALM therefore connects eligible businesses with reliable workers from the Pacific Islands and Timor-Leste. Countries participating in the scheme include Fiji, Kiribati, Nauru, Samoa, Tonga, Tuvalu, Vanuatu, Papua New Guinea, the Solomon Islands and Timor-Leste.
The challenge, of course, is that it’s far too easy for seasonal workers to be exploited. To ensure this does not happen, and that seasonal workers benefit from the programme instead, only accredited businesses that the DFAT and PALM deem Approved Employers can connect businesses with responsible workers. These can be for seasonal jobs of up to nine months, and longer-term roles of up to four years. They also cover unskilled, low-skilled and semi-skilled positions.
The benefits for business, workforces and
It’s a win-win situation. Under the PALM scheme, workers can obtain extended visas of up to four years, with the provision for multiple entries into Australia. This gives businesses an increased workforce stability and retention, while saving them significant costs involved with training a new labour force each year. Approved Employers take care of everything, from sourcing labour, to visa applications and immigration requirements, to the chartering of flights and worker support and pastoral care.
The benefit to workers is also critical. Not only do they have the potential to earn a higher income than they’d typically get back home, but they are exposed to invaluable new experiences and growth opportunities. This includes learning and developing many transferable skills throughout their time in Australia.
For us, the biggest impact is their earnings, however. We have individuals who have built houses and schooled their children thanks to this programme. They have completed qualifications while in Australia and developed their careers. They’ve sent income home to support their extended families and that has stimulated the economies of participating countries. PALM represents a significant opportunity to impact lives both within and outside of Australia’s borders.
The PALM scheme delivers strong protection for workers and participating individuals are protected in the same way as Australian workers, and have the same rights. For example, at Labour Solutions Australia, we provide welfare programs and ongoing support for workers. This is in addition to the PALM scheme Skills Development Program.
We also have to meet the highest safety standards and are certified under ISO 9001, 4801, and 18001. With ever-changing legislation and HR requirements, combined with the importance of always taking an ethical approach to labour, partnering with a trusted and compliant supplier such as LSA is vital.
We understand that this solution is not suited to every business. There are many companies and industries that are still looking for workable solutions to labour shortages across Australia. For most labour-intensive industries, however, PALM is an important initiative when we need it most.
If you would like to discuss how LSA can support your labour needs, fill out our contact form here, or call 1300 268 986.