ANZSCO 3223Victoria

Structural Steel and Welding Trades WorkersNovember 2017

Labour Economics Office Victoria

Department of Jobs and Small Business

Current labour market rating3223-11 Metal Fabricator and 3223-13 Welder (First Class) – Shortage

3223-12 Pressure Welder – Cannot Rate

Previous labour market rating3223-11 Metal Fabricator – Metropolitan Shortage

(November 2016)3223-13 Welder (First Class) – Regional Shortage

Comments

No skill shortage was evident for the metal fabricator and welder (first class) occupations, however, half of metropolitan employers could not fill their vacancies due to remuneration issues.

Survey results[1]

  • Metal fabricator employers filled 47 per cent of vacancies from an average of 6.4 applicants per vacancy and 1.4 suitable applicants per vacancy.
  • Welder (first class) employers filled 40 per cent of their vacancies from an average of 5.5 applicants and 1.7 suitable applicants per vacancy.
  • Two thirds of welder (first class) vacancies were filled in regional areas compared to one quarter in metropolitan areas.
  • Approximately half of all metropolitan employers received suitable applicants but remained unable to fill their vacancies due to an inability to reach agreement with preferred applicants about remuneration levels.

Employer requirements

  • Employers were predominantly from the manufacturing sector.
  • Just over two thirds of employers required a formal qualification with the remainder requiring applicants to have demonstrable skillsets.
  • Approximately half of employers did not prescribe a minimum duration of experience; the remainder required between one to four or more years of relevant experience, depending on the expectations of the role.
  • Half of employers sought applicants with additional licences or tickets including forklift licence, Elevated Working Platform (EWP) ticket, white or red card, rigger ticket and truck licence.

Unsuitable applicants

  • Applicants were mainly considered unsuitable due to not having trade qualifications or lacking relevant experience.
  • Half of all qualified applicants were considered unsuitable, due mainly to a lack of experience in a similar role.
  • Some qualified applicants were rejected because they lacked welding skills or had an unstable work history.

Employer comments

  • Employers variously commented that:
  • The manufacturing industry was often unable to match the construction industry in terms of competitive wages and long term career prospects;
  • The sometimes dirty and physically challenging nature of these occupations was a potential deterrent to future supply;
  • The recent closure of major automotive manufacturers in Victoria was contributing to a public perception that long term opportunities were diminishing within the manufacturing sector.

Demand and supply trends

  • Based on the data below, demand indicators appear mixed while supply appears likely to decrease.
  • The majority of employees in this occupation are employed in the manufacturing industry, followed by the construction industry.[2]
  • Victoria’s manufacturing industry Gross Value Added (GVA) – an indicator of overall industry activity – has been in decline since June 2015 and, in June 2017, recorded its lowest level in five years. Further, it contributed approximately 7.4 per cent to the total Victorian GVA in 2017, the lowest contribution in five years.[3]
  • Actual expenditure in Victorian manufacturing decreased by 1.9 per cent over the year ending June 2017 but is at the fifth highest level recorded (quarterly) in five years.[4]
  • Despite the final closure of major car manufacturing in October 2017, the Australian Industry Group reported that manufacturing conditions remained generally stable outside of the automotive subsector[5].
  • Preliminary data indicate that the value of engineering construction work done increased by approximately 15.6 per cent over the year to September 2017, an increase of 50 per cent on the previous year’s growth (10.4 per cent).[6]
  • Internet vacancies for structural steel and welding trades workers have been trending up since August 2015, reaching a peak level in October 2017.[7]
  • Supply to these occupations is typically through completion of an apprenticeship at the Certificate III level.
  • Commencements have been trending down for the past five years and reached a five year low in June 2017.
  • Completions peaked over the four quarters to March 2011 but have since decreased. Current levels are only slightly above the record low of June 2007.[8]

Outlook

  • The expected short and long term capital expenditure – an indicator of industry confidence and likely future activity levels – in Victorian manufacturing increased (by 14.4 per cent and 3.4 per cent respectively) on the previous year and, as at December 2016, were at the highest levels in four years.[9]
  • Employment in manufacturing over the five years to May 2022 is projected to decrease by 5.5 per cent, compared with growth of 8.8 per cent for all industries in Victoria.[10]

Labour Economics Office Victoria

Department of Jobs and Small Business

[1] The methodology underpinning this research is outlined at Skill Shortage Research Methodology | Department of Jobs and Small Business - Document library, Australian Governmentand can also be accessed by the QR code.

[2] Australian Bureau of Statistics (ABS), Census of Population and Housing, 2011

[3] ABS, Cat. No. 5220.0, Australian National Accounts: State Accounts, Table 03. Expenditure, Income and Industry Components of Gross State Product, Victoria, Chain volume measures and current prices, latest release

[4] ABS, Cat. No. 5625.0, Private New Capital Expenditure and Expected Expenditure, Australia, TABLE 7B. Actual and Expected Capital Expenditure by Industry - Victoria: Current Prices $; Nov-16 (NB: estimate has a relative standard error of 10% to less than 25% and should be used with caution.)

[5] Australian Industry Group, Australian PMI: Manufacturing enters second year of growth, November 2017.

[6] ABS, Cat. No. 8755.0, Construction Work Done, Table 08, Value - Construction Work Done, Chain Volume Measures (latest release)

[7] Department of Employment, Internet Vacancy Index, October 2017, 12 month moving average

[8] National Centre for Vocational Education Research (NCVER), Apprentices and Trainees, June 2017, estimates (limited to Certificate III)

[9] ABS, Cat. No. 5625.0, Private New Capital Expenditure and Expected Expenditure, Australia, TABLE 7B. Actual and Expected Capital Expenditure by Industry - Victoria: Current Prices $; Nov-16

[10] Labour Market Information Portal – 2017 Regional Projections to May 2022, Interactive Tool