Labour Market Research – Automotive Trades

Australia2017

Labour Market Research and Analysis Branch

Department of EmploymentPage 1

Code / Occupation / 2008 / 2009 / 2010 / 2011 / 2012 / 2013 / 2014 / 2015 / 2016 / 2017
3211-11 / Automotive Electrician / S / S / S / S / S / S / S / S / S / S
3212 / Motor Mechanics / S / NS / S / S / S / S / S / S / S / S
3241-11 / Panelbeater / S / S / S / S / S / S / S / S / S / S
3243-11 / Vehicle Painter / S / NS / S / S / S / NS / NS / S / S / S

Key to ratings: S = ShortageNS = No shortage

/ An average of
5.0
applicants per vacancy / / An average of
0.8
suitable applicants per vacancy / / 43%
Proportion of vacancies filled
/ 59%
Proportion of employers with suitable applicants / / 15%
Proportion of employers who attracted no applicants

Shortages of automotive trades occupations have been reported almost consistently since 2008 and in 2017, all occupations in this labour market remained in shortage. The number of suitable applicants per vacancy is the lowest since 2008 while the proportion of vacancies filled is the equal lowest since 2011.

Demand has grown over the past year, as indicated by an upturn in the number of advertised internet vacancies and an increase in the size of the automotive trades workforce.

Despite growth in demand, there has not been a corresponding increase in new supply to the labour market. Over the past few years, the annual number of apprenticeship commencements has remained below the long-term average while completions have been steady.

Survey results[1]

  • In 2017, the labour market for automotive trades occupations tightened(Figure 1).
  • Vacancies attracted an average of 0.8 suitable applicants per vacancy compared with 1.1 in 2016.
  • The number of applicants per vacancy fell to 5.0 in 2017 from 6.1 in 2016 and, similarly, there was a reduction in the proportion of vacancies filled from 48 per cent in 2016 to 43 per cent in 2017.
  • Results from the recent survey are among the lowest in the series.
  • The number of suitable applicants per vacancy is the lowest since 2008 while the proportion of vacancies filled is the equal lowest since 2011.
  • The number of applicants per vacancy is the lowest in five years.

Figure 1: Proportion of vacancies filled (%), average number of applicants and suitable applicants per vacancy (no.), Automotive trades, Australia, 2008 to 2017

Source: Department of Jobs and Small Business, Survey of Employers who have Recently Advertised

  • A substantial proportion of employers (41.5 per cent) did not receive any suitable applicants for their vacancies. This consisted of 14.5 per cent who did not receive any applicants and 27.0 per cent who only attracted unsuitable applicants.
  • Labour market conditions are similar across the individual trades in this cluster, with shortages evident for all of the assessed automotive trades occupations.However, there is some variation (Figure 2).
  • Motor mechanic vacancies attracted the most candidates (an average of 6.3 applicants per vacancy) while panelbeater vacancies attracted the least (3.0 applicants per vacancy).
  • Employers recruiting for panelbeatersalso attracted the lowest number of suitable applicants (an average of 0.6 per vacancy).
  • Vacancies for automotive electricians were the most difficult to fill (only 30 per cent of those vacancies were filled).


Figure 2:Proportion of vacancies filled (%), average number of applicants and suitable applicants per vacancy (no.), Automotive trades, by occupations, Australia, 2017

Source: Department of Jobs and Small Business, Survey of Employers who have Recently Advertised

By location

  • Five states recorded a drop in the proportion of vacancies filled in 2017 compared with 2016.
  • Although the remaining juristrictions (New South Wales, the Northern Territory and the Australian Capital Territory) reported an increase in the proportion of vacancies filled, they were all below 60 per cent (Figure 3).

Figure 3: Proportion of vacancies filled (%), average number of applicants and suitable applicants per vacancy (no.), Automotive trades, by state and territory, Australia, 2017

Source: Department of Jobs and Small Business, Survey of Employers who have Recently Advertised

  • Regionally-based employers experienced more difficulty than metropolitan employers in attracting applicants and filling vacancies.
  • While metropolitan vacancies received 6.1 applicants per vacancy, regional vacancies only attracted 3.4 applicants per vacancy.
  • There were 0.6 suitable applicants per vacancy in regional areas, compared with 0.9 for metropolitan vacancies.
  • Around 37 per cent of regional vacancies were filled, 9 percentage points lower than for metropolitan vacancies.

Reasons applicants were unsuitable

  • The most important criterion for assessing suitability was having a trade qualification, with 94percent of vacancies specifying this as an essential requirement.
  • Over half of applicants were deemed to be unsuitable due to lack of a relevant trade qualification.
  • Almosttwo thirds of trade qualified applicants were also assessed as being unsuitable. Reasons included;
  • insufficient work experience, either general or specific experience (such as working with particular vehicle types or equipment). This was the most commonly cited reason for unsuitability among trade qualified applicants.
  • inadequate technical skills, reflected in the failure to successfully complete work trials, lack of diagnostic skills or unsatisfactory performance on the job.
  • unstable work history, unsatisfactory communication skills, non-attendance at job interview, poor attitude or untidy presentation.
  • Some applicants who were suitable were not hired because of factors unrelated to their skill level such as living too far away from the workplace ordisagreement on wages.

Demand and supply trends

Employment profile

  • At November 2017, there were around 150,000 employed automotive trades workers.[2]
  • Motor mechanics account for almost three quarters (109,900) of employment in this cluster.
  • Over the year to November 2017, automotive trades employment increased by 15.2 per cent, compared with growth of 3.3 per cent for all occupations. Employment is 23.1percent higher than five years ago, compared with growth of 8.9 per cent for all occupations over the same period(Figure 4).[3]

Figure 4: Employment Index (November 2007 = 100), Automotive trades workers, Australia, November 2007 to November 2017

Source: ABS, Labour Force, Department of Jobs and Small Business trend

  • Most of the growth in employment over the past five has been due to an increase in the employment of motor mechanics, vehicle painters and panelbeaters (Table 1).[4]

Table 1:Employment (‘000) and employment change (‘000 and %), Automotivetrades workers, by occupation, November2017

Occupation / Nov 2017
‘000s / 5 year change
‘000s / %
3211Automotive Electricians / 6.2 / -3.0 / -32.5
3212Motor Mechanics / 109.9 / 25.9 / 30.9
3241Panelbeaters / 15.9 / 2.9 / 22.7
3242Vehicle Body Builders and Trimmer[5] / 4.6 / -0.8 / -15.5
3243Vehicle Painters / 12.3 / 2.9 / 30.9

Source: ABS, Labour Force, Department of Jobs and Small Business trend

  • The largest employing industry for automotive trades workers is Other Services (65.8per cent), which includes automotive repair and maintenance. A significant proportion of automotive trades workers are also employed in Retail Trade (11.5 per cent) and Manufacturing (6.3 per cent).[6]
  • Surveyed employers often attributed difficulties attracting automotive trades workers to the relatively low remuneration offered.
  • Earnings for workers employed full-time in automotive trades tend to be below the all occupations average.[7]
  • For panelbeaters and vehicle painters in particular, employers cite the pressure from insurance companies to minimise repair costs as a constraint on pay rates.
  • The Department projects that employment of automotive trades workers will increase modestly (1.0 per cent) over the five years to May 2022.[8]By comparison, employment across all occupations is projected to rise by 7.8 per cent.
  • While there is projected to be a 1.4 per cent (or 1500) increase in employment ofmotor mechanics and 6.0 per cent (or 800) increase in vehicle painters, the number of employed panelbeaters is projected to remain unchanged.Falls in employment are projected for vehicle body builders and trimmers (down by 14.7 per cent or1000) and automotive electricians (down by 0.3 per cent).

Vacancies

  • Internet vacancy levels for automotive trades workers have grown at a stronger rate than the average for all occupations since 2009 (Figure 5).
  • Automotive trades increased by 21.1 per cent over the year to December 2017, but was 5.1percent lower than the series peak in May 2012 (Figure 5).[9]
  • By comparison, all occupations increased by 4.7 per cent over the year.

Figure 5: Internet vacancies, Automotive trades workers and all occupations, Australia,December 2006 to December2017 (indexed)

Source: Department of Jobs and Small Business, Internet Vacancy Index, 12 month moving average (December 2006 = 100)

Training

  • Around 70 per cent of automotive trades workers hold a vocational education and training qualification at the certificate III or IV level.[10]
  • Surveyed employers suggested that it is difficult to attractand retainyoung people to apprenticeships in the automotive trades due to low wages and poor perceptions of the work.
  • Research into the labour market for apprentices[11] undertaken by the Department in 2014-15 showed that for automotive trades
  • almost half of surveyed apprentice vacancies were unfilled
  • some 76 per cent of employers considered it ‘difficult’ or ‘very difficult’ to recruit apprentices
  • lack of applicants was a concern with one in six employers not attracting any applicants for their vacancies, but around one third of employers had been approached directly by people looking to start an apprenticeship.
  • Supply through local apprenticeship and traineeship training was relatively low in 2016-17, adding around 6070 new graduates, slightly below the long term average (Figure 6).[12]
  • Apprenticeship completion numbers have been relatively stable since 2007-08, remaining at around the series average of 6170, the exceptions being a spike to around 7610 in 2013-14 and the recent low the following year to 5460.
  • Although commencements peaked in 2011-12, numbers over the past four years have been below the historical trend. In 2016-17, there was a 2.9 per cent increase in the number of commencements.

Figure6: Apprentices and trainees, Commencements and completions, Automotive trades workers, Australia, 2006-07 to 2016-17

Source: NCVER, Apprentices and Trainees, estimates, certificate IIIqualifications

  • Employment outcomes for those who undertake an apprenticeship or traineeship intended for the automotive trades are strong.[13]
  • More than 90 per cent are employed six months after graduation, with the majority employed in the occupation for which they had trained or one for which their training is relevant.

Other indicators and issues

  • Consumer demand for services from the automotive repair and maintenance sector is closely linked to the number of vehicles in operation and the number of new vehicles sold.
  • There were 18.8 million motor vehicles registered in Australia as at January 2017, with growth of 12.2 per cent over the previous five years. Of particular note, is the growth in the registrations of diesel powered vehicles and motorcycles.[14]
  • The average age of all vehicles registered in Australia is 10.1 years.[15]
  • In 2017, nearly 1.2 million new motor vehicles were sold in Australia, representing an increase of 0.9 per cent on the previous year and 6.9 per cent compared with five years earlier.[16]
  • The number of businesses in the automotive repair and maintenance sector fell by 0.1 per cent between June 2011 and June 2016. By comparison, there was an average increase of 1.8 per cent for all businesses over the same period.[17]
  • A 2017 report by the Victorian Automobile Chamber of Commerce (which included a survey of automotive retailers and repairers) found that skill shortages were at high levels in the industry. It identified the following as the main reasons: “declining levels of new entrants into automotive trades, the poor quality of available labour and problems with attraction and retention of labour.”[18]
  • The report also noted that a range of factors were likely to have a profound impact on the industry over the next decade, these include “introduction of electric, autonomous and connected vehicles, along with changing patterns of car ownership and use.”

Labour Market Research and Analysis Branch

Department of Jobs and Small BusinessPage 1

[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] ABS, Labour Force, November 2017, Department of Jobs and Small Business trend

[3] ibid

[4] ibid

[5] This occupation was not assessed

[6] ABS, Labour Force, 2016 annual average

[7] ABS, Characteristics of Employment, Australia, August 2015, Cat. No. 6333.0: Customised Report (earnings before tax)

[8] Department of Jobs and Small Business, Occupational Projections to May 2022

[9] Department of Jobs and Small Business, Internet Vacancy Index, December 2017

[10] ABS, Education and Work, May 2017

[11] Department of Jobs and Small Business, Labour Market for Apprentices, 2014-15

[12] NCVER, Apprentices and Trainees, June 2017, estimates (limited to certificate III qualification)

[13] NCVER, Student Outcomes, 2015, unpublished data

[14] ABS, Motor Vehicle Census, January 2017

[15] ibid

[16] ABS, Sales of New Motor Vehicles, December 2017, original

[17] ABS, Counts of Australian Businesses, including Entries and Exits, various issues

[18]Victorian Automobile Chamber of Commerce, Directions in Australia’s Automotive Industry, 2017