The Best Workforce We Can Have Professor Sue Richardson National Institute of Labour Studies Flinders University

Three points  Widespread skill shortages are a good thing  The structure of employment is constantly changing  Skills are more than formal education 2

Skill shortages are good  When they mean general shortage of labour  This is full employment—cannot do better  To the firm, means hard to get and retain the combination of qualities they want  To the workers, means there are abundant jobs  Firms are not used to having buyers waiting and unable to supply 3

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Structure of jobs changes  There will never be a perfect match  Much adjustment occurs through learning on the (new) job  Formal education is only a part of this  Capacity of firms to teach and workers to learn is essential 5

Average annual change in employment by industry 2001 to ABS, Labour Force, Australia, Detailed, Quarterly, Feb 2011, Catalogue No

Stock of HK inflows outflows inflows outflows New entrants New education More experience withdrawal emigration depreciation 7

Increase in Human Capital Stock constant 2001 dollars, billions Female Male Ratio of female to male ABS Research paper , Measuring human capital flows for Australia, by Hui Wei, 2008

Components of change in Human Capital stock: , billion 2001 $ ComponentFemaleMale Education net Additional post school91103 Depreciation Experience Additional experience Depreciation of experience Youth inflows Ageing of base stock Immigrants Emigrants ABS Research paper , Measuring human capital flows for Australia, by Hui Wei, 2008

OECD estimates of human capital per capita in OECD Human Capital ProjectMarco Mira d’Ercole

OECD measures of human capital 11

OECD: share of human capital of men and women 12