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Today’s modern world is changing into a business hub that is connected with all the relevant resources with the internet. The modern age has been changing rapidly into an ‘Age of Information.’ Everything that was earlier far away from the reach of an individual is easily available through internet, which is further connected to large shipping networks. Australia is one such country that needs these networks necessarily because it is a continent, surrounded by sea from all its borders. However, recently the IT and Software industry in Australia is facing many concerns of recruitment and HR.
Australia is going to face a major downfall in the availability of young IT and software professionals by the year 2054, since the major population of Australia (around 1 in 1000 people) will reach an age of 65 and there will be deficiency in skills required for the IT and other relevant sectors like tourism, education, and construction. This report has been written to provide a brief analysis about the major issues that the IT and software industry will have to face in Australia.
Australia has become a major hub for many ICT (Information and Communication Technologies) related service providers in the world. In fact, many other industries in the country like tourism, hospitality, public services, education, and banking has been looking forward to hiring ICT professionals so as to make their services more user friendly and adaptable to the latest ICT technologies. ICT is the major contributor to the economic growth in Australia, having a market worth of around $120 billion (figures in Australian dollar) and is providing employment to around 400,000 people.
The ICT industry has been growing rapidly in Australia, and thus the supply/demand curve of ICT professionals has been misbalancing due to lack of skilled professionals in the ICT industry. Although the shortage of skilled ICT professionals is prevalent in most parts of the world and is global in nature, but it is predicted that the Australian industry is going to affect mostly due to this shortage. There are many reasons for the shortage of skilled ICT professionals, especially in case of cyber security experts precisely. The very common reason for such kind of shortage is lack of experience of the new professionals and changing requirements of the ICT companies.
Earlier, there were only some sophisticated government and secret agencies that would need a cyber security and other ICT technologies adoption. However, now the circumstances in ICT field are changing rapidly and every company that operates its ICT services over the internet requires a skilled cyber security expert; to save the valuable resources for the company.
The situation of ICT recruitment has worsened in the Australian ICT industry because of the various compliances and regulations. Intel has recently done a survey to understand the enormity of the shortage of ICT professionals and the results were really alarming. It was found in the survey that around 88% of Australian ICT decision makers were finding it daunting to recruit cyber security experts. Meanwhile, around 17% thought that the vacant positions are not going to fill by 2020 (Lowell, 2005).
Managing an ICT company in Australia is not a piece of cake for any ICT organization. Every ICT company needs to follow the government regulations and compliances to operate in Australia. The regulations related to HR and employment like the EBA (Enterprise Business Agreement) or fulfilling the modern award criteria are really a tidy task for most of the ICT companies, whether Australian or foreign. Meanwhile, the companies also have to maintain their image as a good employer in the country that requires following many standards like Six Sigma, etc. Following are some of the challenges that every ICT industry in Australia has to face: —
- Recruitment Planning: — Planning of recruitment has become a major challenge of the ICT companies in Australia. The ICT companies have to deal with human assets to not only make them important, but also of the best quality within the organizational settings. The invention of modern technologies like cloud are putting more pressure on the ICT companies for recruitment planning.
- Performance Management: — Another challenge that most of the ICT companies have been facing recently is the performance management. Nowadays, it’s not enough to just recruit employees, but it has also become mandatory to let them improve their performance with time. ICT companies have to suspend or fire the employees who are not performing well, even after providing them an extensive and expensive training.
- Development and Training: — It’s not enough for most of the ICT companies to just recruit employees and appoint them for the work. Since there are many different technologies and frameworks in today’s ICT settings, the companies have to provide extensive training and development. This process is often long and expensive, but the ICT organizations must follow them to retain their image as a best ICT company and employer in Australia.
- High Level of Attrition: — The level of attrition in the ICT industry is very high. It is possible that the technology looking plausible from the today’s perspective of ICT may become obsolete in the coming 1-5 years or a decade. So, another great challenge for most of the ICT companies is to keep the level of attrition as low as possible. The ICT workforce is thus becoming important and their retention becomes the major goal in this scenario. So, many companies adopt different strategies to retain the highly skilled employees like higher compensation and pay packages, ESOP (Employee Stock Ownership Plan), and other plausible benefits(Patil, 2011).
The Australian population has recently been going through a major transition in terms of age, generations, and diversity. It is estimated that the population of the Australians ageing rapidly and the population of people with age more than 65 years would become double by the year 2020, having around 1 out of 1000 people being overaged by the year 2020. This transition in the age of the Australian population would have many dire consequences for the employers and also the government.
The overall workforce participation rate in Australia is going to become worse and there would be around 1 million Australians intend to retire in the coming decade. Therefore, the national workforce participation rate would drop from 65 percent to 61 percent by the year 2020. This transition is not a good sign for the major ICT companies who will need young ICT professionals in the coming decade. So, these figures show that the circumstances are going to become worse for the ICT industry that is already facing a major shortage of skilled professionals (Gringart, 2005).
Another demographic issue of recruitment that the ICT industries has been facing recently is the gap of generations. The Australian population is comprised to mainly 3 different generations: the first one is the baby boomers; second the Gen X; and finally, the Gen Y. The baby boomers represent around 26 percent of the Australian population, who born between 1946-64. Most of these baby boomer people come from the other countries like UK, USA, and Canada in the 1950’s migration. In the coming decade, the baby boomers’ part of the Australian population will become 60 years or more in age that would become a challenge for the employers to manage an ageing workforce. Next consecutive generations having a majority of the population in Australia are the Gen X, which comprises of 21 percent of the Australian population and 4.4 million strengths; and finally, the Gen Y that comprises of 20 percent of the Australian population with a strength of around 4.2 million. In spite of the baby boomers are the majority population in Australia; the ICT companies are not willing to hire them since they always look for young, fresh talents of age belonging to the Gen Y population in Australia (McCrindle, 2006).
Finally, the ICT companies in Australia have been facing issues of lack of diversity in the employment of female gender employees. The number of graduates completing their IT courses in the Australian Universities has been declining rapidly over the last 5 years. This decline in the availability of IT graduates is not only affecting the availability of young professionals for the organizations, but a lack of diversity also prevails in the workforce rates and differential rates of participation in the IT employment (Bilimoria, 2005). The figure 1 below shows the percentage of participation of the women in ICT and other industries: —
Figure 1. Participation of Women in ICT and Other Industries (Strack, 2015)
The trend of retention of the IT professionals has been increasing in the ICT market recently. The various ICT companies operating in the Australian continent are willing to push every limit to retain an ICT professional, which is making the situation worse. Although this may be a positive sign for the ICT professionals, but this sagacity is not beneficial for the future of the ICT industry and the professionals. Motivation and retention of the ICT professionals have become a major concern for most of the ICT companies.
The support of training and learning, and the use of new technologies, and a challenging ICT environment are ranking the professionals higher than competitive pay structures as effective retention practices. The effect of globalization and the internet are also prevalent among the ICT companies. Many ICT companies are willing to pay any higher pay package to attract global talent from other countries like India or China; instead of paying the same amount to the Australian ICT professionals. In such a seller’s market, ICT companies are leaving no stone unturned to understand which organization, reward, and job factors are capable to attract the best talent from the other countries also (Ang, 2006).
6.0 Recommendations for the Issues
After the thorough analysis of the various issues of the recruitment in the ICT industry in Australia; following recommendations are suggested: —
- It has been evident that the ICT industry in Australia has a misconception that women and indigenous people are not relevant for working in the ICT industry. The government of Australia must make some tough regulations to ensure that the ICT industry in Australia is not discriminating against gender or ethnicity of the population.
- The government of Australia must encourage the Australian students to take the ICT courses in their graduation. This can solve the issue of unavailability of the ICT professionals in the future. The government can provide some subsidy or scholarship to the students who enroll for the ICT courses, so as to cover the decline in the number of students enrolling for the ICT courses.
- The various ICT companies can join hands with the Universities to provide extensive training to students who are pursuing ICT courses right from the beginning, so that they can become more acquainted to the jobs that they are going to carry in the future.
The Australian ICT industry has been facing a major transition of the lack of workforce recently that may affect its overall economic growth and well-being. However, there are still many options for these companies like increasing the employment for the mature age employees, women, and some indigenous Australian population. These ICT companies have to come out of the misconception that these people are not fit for the ICT industry.
This report has been written to provide some insights to the people about the changing trends of employment and workforce shortage in the ICT industry. It can provide information about the various issues that the Australian ICT industry has been facing due to workforce shortage. However, there may be some limitations of this report, depending upon the resources available.
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Ang, L. &. (2006). Customer retention management processes: A quantitative study. European Journal of Marketing, 83-99.
Bilimoria, D. &. (2005). Board Committee Membership: Effects of Sex-based Bias. Academy of Management Journal , 1453-1477.
Gringart, E. e. (2005). Exploring Attitudes Toward Older Workers Among Australian Employers. Journal of Ageing and Social Policy, 85-103.
Lowell, B. L. (2005). Policies and Regulations for Managing Skilled International Migration for Work . United Nations Expert Group Meeting on International Migration and Development, 1-24.
McCrindle, M. (2006). New Generations at Work: Attracting, Recruiting, Retaining and Training . Melbourne: McCrindle Research.
Patil, R. S. (2011). Human Resource Challenges & Practices in IT Industry. Bharati Vidyapeeth‟s Institute of Computer Applications and Management, 1-4.
Strack, R. e. (2015). The Promise of Diversity and Gender Eqaulity in ICT Profession. Melbourne: BCG Perspectives.
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