This OECD report comes at a time when governments around the world are beginning the process of recovery from the COVID-19 crisis. With the closure of its borders to non-residents in March 2020, and by quickly imposing social distancing rules and closures of non-essential services, Australia, with among the lowest death rates in the world, has weathered the pandemic relatively well compared to many other countries but some of its regions have been hit harder than others. Small outbreaks have led to short localised lockdowns and some state border closures. Vaccinations began in February 2021, with widespread vaccination expected by the end of 2021.

COVID-19 is likely to accelerate the megatrends that were already changing labour markets prior to the pandemic. But although Australia has been spared the worst of the pandemic’s effects, like many other countries, it has led to an acceleration in automation as firms expanded their use of technologies in the face of lockdown measures. The pandemic has also accelerated other megatrends, in particular around sustainability, and heightened awareness of inclusiveness, as part of an agenda to ‘build back better.’ Whilst, the long-term impacts of these changes remains uncertain, for example with respect to remote-working, it is more likely than not that they result in permanent changes, at least in some form. It is also inevitable that the transitions will differ across people and places. Some will find the transition more difficult, however it could also reorient trends such as urbanisation and globalisation that open up new opportunities for places that were previously left behind.

This OECD report sheds light on the threats and opportunities facing local labour markets in Australia in the future of work. It also highlights the actions needed to prepare people, places and firms. The report includes a special focus on the regions of Sydney-South West (New South Wales) and Warrnambool and South West (Victoria). Even before COVID-19, automation, digitalisation and artificial intelligence were already re-shaping local labour markets across Australia. Whilst these trends offer the opportunity to boost productivity, increase prosperity and raise living standards, they can also cause disparities. Workers who lose jobs may not always have the skills needed in a changing labour market and might struggle to find a new job and the opportunities are not always equal across places.

This report is part of the OECD Review on Local Job Creation Series within the Programme of Work of the OECD Local Employment and Economic Development (LEED) Programme. Created in 1982, the LEED Programme aims to contribute to the creation of more and better jobs in more productive and inclusive economies. It produces guidance to make the implementation of national policies more effective at the local level, while stimulating innovative practices on the ground. The OECD LEED Directing Committee, which gathers governments of OECD member and non-member countries, oversees the work of the LEED Programme. This report was approved by written procedure by the OECD LEED Directing Committee on 22 June 2021.

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