Are Skills the Answer to Australias Competitiveness - Essay Example

Are Skills the Answer to Australia’s Competiveness? (For Human Resource Management) Student’s Name: Instructor’s Name: Course Code & Name: Date of Submission: Are Skills the Answer to Australia’s Competiveness? (For Human Resource Management) Introduction The level of competiveness of a country is determined by many factors. Key among the many factors is the availability of the factors of production, which are the forms of capital. They include land, labour, enterprise and capital. Since the four factors of production form the basis for the development of industry, the government and other stakeholders involved must invest equally in all of them. Failure to invest in either one of them creates an imbalance in production; hence the production levels do not reach the maximum limits. The gradual disinvestment in either one of them leads to a gradual crisis which ultimately leads to a major crisis. The clack of competitiveness in some countries in the world has been led by this action. Key among the misdoings of many governments and corporates is their failure to invest in labour factor of production. The labour factor of production is the factor which is responsible for ensuring that corporations and governments are able to live up to their goals and objectives (MacDonald, R., 2011, p.426). This is due to the fact that the labour section is the one which is responsible for the implementation of the various strategies which have been put in place. There are many ways in which the organizations and governments have failed to invest in labour. Key among them is their failure to uphold the generation, and development of skills in the workforce. This ultimately leads to low production which consequently translates to a gradual loss of competitiveness ((Skills Australia, 2012, p.6). The following paper takes a sharp focus into the relationship between skills and competitiveness with respect to Australia’s situation. Argument for skills as an answer to Australia’s competitiveness As pointed out above, Labour is one of the factors of production. For an organization or country to perform well in its productivity, the labour force in the country must be competent enough to support the production and labor demands of the market (MacDonald, R., 2011, p.426). Therefore, the lack of a competent workforce translates to low productivity and consequently lack of competitiveness. The competence of a labour force is based on the skills which are available in the labour force; the more skilled it is, the more competent it is. For this reason, skills have a direct impact on the competitiveness of a country. Taking a look at several countries which have seen a reduction I competitiveness for instance the United Kingdom, it is clear that the countries have an insufficient supply of skills. This is the same case with Australia. This situation explains why countries are luring skilled people into their countries for instance the Australian government is giving work permits to skilled foreigners and the Green card program in the United States of America Argument Against skills as an answer to Australia’s competitiveness However, contrary to what many professionals propose that skills are the answer to Australia’s competiveness, there are several counter arguments to this. This is because the competitiveness of a country is determined by many factors which affect the business environment of a country. Firstly, skills provide the economy with the much needed expertise. However, in a situation whereby the economy is not doing well in the first place, skills are not to blame for its lack of competitiveness. For instance, looking at the analysis of the latest competitiveness ranking, there are various issues which have been identified as factors which are leading to Australia’s lack of competitiveness. The increased burden of government regulation of the business environment is a major factor disadvantaging the country. Other factors which have led to the lack of competitiveness in Australia are lack of innovation, lack of appropriate infrastructure and business sophistication (Martin, 2012, p1). Therefore, lack of skills is not the complete solution to Australia’s competitiveness but it is just but one of the answers to the issue. This paper will reflect on skills as a answer to Australia’s competitiveness. Evaluation Just as other countries in the world for instance the United Kingdom, Australia also suffers from lack of skills. This has led to a reduction in the competitiveness of the country over time. This is because of the lack of pertinent skills which are needed in all the sectors of production of the country. According to the global competitiveness report for the year 2011/2012, Australia is ranked at position 20 in the globe. This indicates that the country is not able to offer the same production opportunities as it is with other countries which are ranked on top of it. According to the report by the global economic survey, Australia has lost competitiveness in waste management, skills, labour attractiveness and general productivity. This lack of competitiveness can be associated with the reduction in the countries investment in the development of skills in the countries workforce. According to the report, the country’s labour market efficiency was ranked at the 42nd Position. Apart from the country’s unfriendly labour environment, lack of skills was noted to be one of the key factors resulting to this. The Australian government and the corporate in the country have seen the implications of a lack of skills in the labour market. Due to this, the government and the corporate have embarked on education and training programs which are aimed at ensuring that the country’s workforce has the competent labour force which has the appropriate skills needed by the market demands in the country (Skills Australia, 2011, p.5). Over the years, there have been temporary measures which were aimed at bringing the right skills to the country. They include the awarding of working visas to skilled foreigners who in turn brought the much needed skill injection into the country. However, the most efficient and sustainable policy for the country to adopt is the integration of an education and training program which is to run from primary to tertiary education. Retraining and refresher courses are also a key skill improvement strategy for corporate and the government to use. As a policy to ensure that Australia is able to reduce the number of unskilled workers in the county, the government establishes and agency which was responsible for establishing programs and policies whose aims was to impact skills on Australians, the Australian Workforce and Productivity Agency (Australian Government, 2012, p.1).. Over time, the agency has made great steps towards transforming the labour market in the country. The Australian Workforce and Productivity Agency, has been able to transform the state of the country due to a number of reasons. One of the main factors which have given a better chance of solving the inadequacy skills in the country is because it is an independent body as opposed to its predecessor which was influenced by external forces (Australian Government, 2012, p.1).. Through the Australian Workforce and Productivity Agency, the government has been able to provide a workforce development fund, research on the skills and workforce situations in Australia, encourage the coordinated involvement of the industries in the development of skills in their workforce via retraining, align the development of the skills with the specific requirements in the country, providing free consultancy services to industries in the country and lastly, the government has been able to promote labourforce productivity by establishing measures which are aimed at providing better working conditions. The Australian Workforce and Development Agency is protected by a legislative act, hence it is able to perform its activities within a legal setting. According to Finegold and Soskice (1998, p.21), skills are vital for the productivity of a country. It is recommended that a country strives towards establishing an efficient skills ecosystem which is rich in all the levels of skills. Over time, countries and industries have downplayed the importance of skills in productivity. Just like Australia, this has led to a drastic reduction in the level of investment in education and training. In most of the countries which have continuously been ranked low in the competitiveness rating, there is a high presence of unskilled labour force. This in turn relates to a reduced level of production, hence leading to a reduced competitiveness (Skills Australia, 2012, p.10). The lack of skills in a market is a result of a lack of an efficient training program in a country. Basically, training is supposed to occur after an individual has undergone basic education. Afterwards, the government and other players in a country offer tertiary education which impacts specific skills in an individual. A high number of individuals who get tertiary education translate to a high number of skulled people. This translates to productivity and consequently to competitiveness. However, this is not enough, due to the continuous changes in the market trends and technology; there is a creation of new labour demands. For this reason, compotes and government a must devise ways of ensuring that their respective organizations d countries have the capacity to meet the new demands. Examples of such demands include postmodern engineers, Information Technology specialists, teachers, doctors among other professionals. Therefore, there has to be a program which retrains the workforce that is already in the market. This is in a bid to ensure that the labour force is able to maintain productivity at par with the current production methods in the industry. An appropriate education and training program results to a skill ecosystem (Finegold, 1998, p.68). According to Finegold, a skill ecosystem ensures that a corporate or a government is able to have a workforce which is rich is all the levels of skills. A good skills ecosystem is supposed to have highly skilled workers, intermediate skilled workers and low skilled workers. The importance of each level of labour cannot be downplayed. The lack of any one of them consequently leads to a reduction in productivity which ultimately results to a reduction in the competitiveness of a country. In order to establish a good skills ecosystem, the stakeholders in a country must embark of a strategic education, training and skill development strategy (Skills Australia, 2011, p.5). A simple skill ecosystem model is illustrated below. Skill Ecosystem (Anderson & Warhurst, n.d, p.8) To start with, there must be mechanisms of educating and training the labour force in a country. This is development of skills. After the development of skilled manpower, there has to be a deployment of the manpower in the sectors which it is needed. After deployment, the workforce is also retained so as to ensure that they get additional skills hence leading to a development of their abilities. On the other hand, a demand in the industry results to a move aimed at finding the most competent individuals in the market (Anderson & Warhurst, n.d, p.8). These demands for a supply of the skilled workforce. If the workforce is not available, it can be sourced from outside a country. In addition to this, programs aimed at developing the specific skills are established. This leads to their development hence, meeting the skills demands in the industry. With respect to Australia, the government and other stakeholders involved have a move to ensure that the country is able to regain its competitiveness in the world. Various industries in the country have embarked on training programs which are aimed at impacting skills on their workforce. Human resource empowerment is an emerging trend in market and it has been led about by the skill shortages experiences which the country’s industries have experienced. On the other hand, the government has embarked on skills development in the country. Through the Australian Workforce and Productivity Agency, the country has been able to transform the availability of skilled professionals in the country. Through the provision of a workforce development fund, the government has been able to increase the number of people who are able to get training, hence increasing the number of skilled workers. Through the research on the skills and workforce situations in the country, the government has been able to identify areas which the country has inadequacy in skilled manpower hence pooling its resources towards meeting the skills needs (Australian Government, 2012, p.1). The encouraging of a coordinated involvement of the industries in the development of skills in their workforce via retraining has ensured that the countries labour force is empowered with modern age skills which enhance productivity. The alignment of the development of the skills with the specific requirements in the country is as a result of the research on the workforce in the country. This ensures that the country will be able to improve on its skilled labour shortages (Rudd, Swan, Smith &Wong, 2007, p.1). Providing free consultancy services to industries in the country gives the stakeholders in the country a chance to get free advice on appropriate human resource development measures. Lastly, the government has been able to promote labourforce productivity by establishing measures which are aimed at providing better working conditions for example good labour laws and management practices (Australian Government, 2012, p.1). Conclusion Concluding, just like other countries in the world, Australia is trying to create a sustainable skills ecosystem. This is with an aim of ensuring that the country is able to meet its production demands, and as a result of this increase its global competitiveness. The competitiveness of a country is a determinant of the ability of the country to support investments and consequently have a return on invested capital. The main drive of an ability to make a return on investment is productivity. As indicated in the paper, productivity is affected by the ability of the workforce in an industry to use the right production practices. The right production practices are determined by the skills of the workforce. In the paper, there has been an emphasis on the need to establish a skill ecosystem which is able to support the specific skills requirements in an industry. With respect to Australia, it still has a far way to go, if it is to compete with the likes of Switzerland and Finland. However, it is on the right path and the correct involvement of the government and other stakeholders concerned, it will be able to increase its competitiveness. References Anderson, P., & Warhurst, C., n.d. Lost In Translation? The Policy Shift to Skill Ecosystems, pp.1-12 Australian Government, 2012. Australian Workforce and Productivity Agency, Viewed on 21st September 2012 from < http://www.awpa.gov.au/about-awpa/about-awpa.html > FineGold, D & Soskice, D., 1999. The Failure of Training In Britain: Analysis And Prescription, Oxford Review Of Economic Policy, Vol. 4, No. 3, PP.21-54 Finegold, D.1999. Creating Self Sustaining High Skill Ecosystems, Oxford Review Of Economic Policy, Vol. 15, NO.1 pp.60-82 MacDonald, R., 2011 Youth transitions, unemployment and underemployment, Journal Of Sociology, Vol. 47, no.4, pp.425-444 Rudd, K, Swan, W, Smith, S, &Wong, P., 2007Skilling Australian for the future, viewed on 21st September 2012 from Skills Australia, 2011. Skills For Prosperity, Australian Government, pp.1-176 Skils Australia, 2012. Better Use Of Skills, Better Outcomes: A Research Report On Skills Utilization In Australia, Australian Government, 1-19. Martin, S., (2012). Australia's International Ranking On Competitiveness, Viewed on 5th October 2012 from Read More