The Federal Government’s recent “attack” on 457-visas in the IT sector is another setback for an industry already facing critical hurdles in meeting its current and future skills needs, says Peoplebank CEO Peter Acheson.
“We’ve done a pretty good job of trashing 457-visas for IT as a country in the last six weeks, driven by our Prime Minister,” he said at last week’s IT18 Conference, of Prime Minister Gillard’s recent comments that the industry was overly reliant on the visa subclass.
Acheson conceded that the IT labour market was broadly flat at present, and, according to DEEWR statistics, employment in the sector had actually declined 27% in the year to October 2012.
“Despite that, there are still shortages of categories of people. Try to find that business analyst with deep financial services understanding in the Australian market today. There’s not many of them. Try and find .Net programmers. Try and find Java programmers.”
These shortages were compounded, he said, by a 55% decline in ICT course enrolments over the past decade, record low completion rates, and a “dramatic” drop in women in the IT workforce, from 131,009 in February 2011, to 91,400 a year later.
“On balance, the ability for this country to meet the [skills] demands of IT and our digital economy… is limited.”
Licensing could drive consolidation, and that’s a good thing
Acheson also told the conference he believed the recruitment industry would benefit from a mandatory licensing system.While compliance might be an issue for smaller recruitment companies, he said as the CEO of a big player, he would welcome the move to a Federal scheme.
“It would be one way of… accelerating industry consolidation, and I think that would actually be a very good thing for clients, and contractors and candidates.”
Contract failures provide warning on RPO
Meanwhile, Acheson said history had shown the RPO model didn’t always work, and some deals were doomed from the beginning when the provider secured the business by offering an unrealistic price.Acheson said he was aware of a handful of “major contracts” in recent years that had failed after the RPO provider overpromised and under-delivered.
“In those cases – and there’s a number of them – I think the vendor has gone in aggressively on price to win the business and then subsequently it’s worked out that it was far more expensive to provide the service than they thought,” he said.
“They end up having to hire low-cost resources, or low-skilled people, to service the low price they’ve bid at to win the business and… don’t deliver.”
Acheson said another issue for employers to consider before switching to an RPO was whether their current recruitment process was working, or if there were existing issues that needed addressing – because passing the problems on to an RPO company wouldn’t solve them.
“You never outsource a broken process. It’s always going to fail.”