Australia’s engineering skills shortage is having ramifications on its renewable energy plans

Australia is in dire need of both domestic and overseas qualified engineers for its clean energy transition and net zero objectives. Engineers Australia believes that Government, industry, and tertiary education must work together to solve the shortfall.

Published

September 19, 2023

Australia has an engineering skills gap that it needs to fill

Australia is facing its greatest-ever engineering skills shortage.[i] Engineers Australia have estimated that 50,000 engineers will be needed over the next few years, with all engineering disciplines (except biomedical engineering) and all sectors of the economy requiring more engineers. Professionals Australia has estimated that by 2040, there will be a skills shortage of 200,000 engineers.[ii] Demand for engineering skills is growing partly because of the national priority of a clean energy transition and net zero emissions objectives. At the same time, the supply of both Australian engineers and skilled migrant engineers is decreasing[iii], despite predictions from Australia’s National Skills Commission that between 2021 and 2026, employment in STEM occupations would increase by 12.9%.[iv]

The engineering skills gap is worse in the public sector than in the private sector, largely due to public sector wage caps.[v] Jane MacMaster, Chief Engineer for Engineers Australia, says that,

“The national conversation on the engineering skills shortage is an important one because it translates to longer project timelines and higher project costs. For many time-critical endeavours such as the transition to net zero emissions and circular economies, there is no time and money to spare.”[vi]

Australia plans to close 62% of its coal-fired power stations in the national electricity market by 2033.[vii] New energy projects like the Snowy Hydro 2.0 are meant to address the energy demand, but these are facing the challenge of limited resources and a shortage of engineers.[viii]

Source: Snowyhydro

Increasing the number of young people studying engineering and the number of skilled migrants getting into engineering work is key

A large reason for a decline in the supply of Australian engineers is that fewer Australians are studying engineering in higher education. Australia is the third lowest producer of engineers as a proportion of all graduates in the OECD.[ix] Each year, around 7,500 four-year graduate engineers are graduating from Australian universities.[x] This is anticipated to get worse in the future because fewer Australian children are choosing to study intermediate and higher-level mathematics at school.[xi] Furthermore, women are being underutilised. Less than two in ten engineering students are women, which has led to women only making up about 15% of the university-qualified engineering workforce.[xii]

About 58% of Australia’s engineering workforce comes from overseas.[xiii] The closing of Australia’s borders during the COVID-19 pandemic, leading to net negative migration, is one reason for a decreased migrant workforce skilled in engineering. Another issue is that skilled migrants moving to Australia are not being supported enough in finding work that aligns with their qualifications. This means that only about 40% of skilled migrant engineers are actually employed in an engineering role.[xiv]

Another challenge to Australia’s overseas workforce is the US Inflation Reduction Act (IRA). The IRA is investing $370 billion into clean energy programs in the United States, encouraging US engineers working in Australia to return home.[xv]

‍How to fix the problem

ZCA has previously discussed the ‘Skyline Skills Recommendations Report 2023’. The report found a lack of awareness amongst UK school children about what careers are available in the built environment and how these careers can contribute to addressing the climate crisis.[xvi] This is remarkably similar to the Australian engineering case. To encourage more Australians to study engineering, there needs to be more awareness among school students and their parents about what engineering is and how it positively impacts the planet. Studying prerequisite subjects for engineering also needs to be encouraged.[xvii]

Engineers Australia provides some concrete ways for Government, industry, and tertiary education to help address the gap. The recommendations to the Australian Government focus around increasing the number of STEM subject teachers, incentivising Commonwealth contractors to create graduate programmes and internships for engineers, providing Commonwealth Supported Places (CPS) for Accredited Engineering master’s qualifications, helping previous engineers return to the workforce, and changing the objectives of Australia’s migration programme.[xviii]

Industry can also provide more internships and programmes. Industry should also focus on company initiatives that will retain engineers; this might include offering mid-career engineers a senior ‘sponsor’ who can help them progress in their careers. Industry should also support skilled migrant engineers with employment opportunities and partner with schools to support their STEM programmes.[xix]

The advice for the tertiary education sector focuses on support. Universities need to look at inclusivity in engineering degrees, particularly around the barriers that women face in the subject and how this can lead to imposter syndrome. Universities should support scholarships that alleviate financial burdens and contact engineering students who withdraw from their course to see if they can retain them through further support. The tertiary education sector should be a proponent of CSPs for the two-year post-graduate conversion master’s to encourage graduates from other STEM fields to become professional engineers. Finally, the tertiary education sector needs to work with industry and government to help students find internships and graduate employment opportunities in engineering.[xx]