1 in 3 unemployed Australians can’t find a job that matches their skills. Here’s what HR can do about it

Many Australians are not without work because they don’t want it. They are without work because they cannot see a clear path from what they know today to what employers are asking for, writes Nic Cola.

HR teams in Australia are getting a wake-up call. The problem isn’t just that they can’t find people to hire. The problem is much more nuanced – the skills available don’t match the jobs on the table.

New Australian Bureau of Statistics data shows that of the 3.2 million people who didn’t have a job in the September quarter of 2025, the most important factor for returning to work was finding a job matching their skills and experience. In other words, one in three Australians without work feel “skill-mismatched”, not disengaged.

The same release points to a pool of 1.2 million job-ready people, of which 1 million were available to start work within four weeks. This insight is crucial because workforce appetite and availability exist, but many people feel locked out because their skills don’t align with what employers need today.

The reality of ‘skill-lock’

When looking at the Australian market more granularly, the feeling of being “skill-locked” is most visible in fast-changing sectors like technology. To paint this picture, we are projected to need 1.3 million technology workers by 2030. While the ABS data doesn’t tell us where the 1.2 million jobseekers want to work, it confirms a large cohort is ready and available, yet feels their current skills don’t match the roles they are trying to access.

A similar pattern is emerging in sustainability. In RMIT Online’s research, 43 per cent of businesses said they lack adequate knowledge to prepare for the climate crisis, and 50 per cent are struggling to hire appropriately skilled talent. We estimate Australia will need a million more green-skilled workers by 2030. Demand is accelerating, and skills aren’t moving fast enough to keep up.

Upskilling as workforce infrastructure, not an employee perk

For too long, upskilling has been positioned as an employee perk – a reward for high performers. But when a third of people without work say the biggest barrier is a lack of the right training, upskilling becomes economic infrastructure. It is how we keep people employable and how businesses fill critical gaps faster.

We must move past an outdated idea of how careers work: that you study in your early 20s, then you spend the rest of your life. Today, the tools, platforms and expectations inside most roles change in months. AI is accelerating that shift, but it’s not the only driver. Compliance requirements evolve. New technologies become standard. Customer expectations rise. Whole job functions are redesigned.

That means learning can’t be treated as a once-off phase of life. It has to become a normal part of working life – like staying on top of safety standards, cyber hygiene, or regulatory change. The modern career isn’t “learn, then work”. It’s “work, learn, adapt – repeatedly”.

Moving to a ‘skills-first’ strategy

To bridge this gap, HR leaders should consider five strategic shifts:

Move to “skills-first” hiring. Identify the true competencies needed for performance rather than the historical credentials used to screen candidates. Build recruitment around evidence of capability, such as tasks, portfolios, and verified short-course credentials.

Treat internal mobility as a skills strategy. If you are struggling to hire, ask if you already employ people who could grow into those roles. Our research identified 661,300 women with a short-term pathway into technology, achievable through a short course and on-the-job training. These are the transitions HR can enable through structured internal pathways.

Replace “big retraining” with targeted learning. For many roles, people don’t need a new degree; they need a focused capability lift. This could be a new toolset, a project method, or a specific data skill. Industry-aligned, short-form learning allows for these pivots without people having to hit pause on their lives.

Make learning time real, not theoretical. If time is a barrier, solve it structurally. Protected learning hours and manager KPIs tied to development ensure that learning is treated as a normal part of the workday.

Build the business case in commercial language. Upskilling is a commercial lever. When HR can quantify the impact of filling roles faster and reducing churn, learning becomes easier to fund. For large companies, closing the gender gap in tech alone could deliver annual benefits of $1.8 million.

Bridging the gap

The ABS data provides a reality check: many Australians are not without work because they don’t want it. They are without work because they cannot see a clear path from what they know today to what employers are asking for.

That gap is exactly where HR can lead. By modernising how we define talent and investing in agile, industry-aligned learning, we won’t just fill jobs. We will build workforces that can keep pace with change – the most strategic contribution HR can make to Australia’s future prosperity.

Nic Cola is the CEO of RMIT Online.