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AUKUS Has a People Problem

Unless Australia can develop its skilled workforce, it will struggle to acquire the advanced defence capabilities outlined in the AUKUS agreement. The limited pool of skilled workers is a problem affecting many industries and technology fields across Australia. More than that, it’s a problem common to countries that are natural partners to Australia, including the United States and United Kingdom in AUKUS. It’s something we need to address together to ensure AUKUS achieves its potential.

As US Senate Armed Services Committee chair Jack Reed acknowledged in a discussion with a Washington defence writers’ group this year, ‘We need skilled workers here in the United States and we also want to develop skilled workers in Australia, too … That requires training and in this labor market … it’s very difficult to get workers for any type of activity.’

Last month’s AUKUS ‘optimal pathway’ announcement outlined the beginnings of a solution with Australian investment in US and UK submarine construction and the training of Australian submariners, but the challenge is enormous. The workforce shortage was identified as a ‘key vulnerability’ in a 2020 report to Congress from the US Navy, with material engineers, marine electricians and tech-specific specialists in short supply. Despite increased funding and recruitment drives, the talent deficit is proving difficult to rectify because of the extensive training required for individuals to qualify in these fields.

For Australia and its partners, the skill shortage is particularly evident in advanced technology sectors, including areas of priority for AUKUS Pillar 2—the non-submarine component of the agreement that focuses on technology sharing in eight critical sectors, including artificial intelligence and quantum computing.

To support AUKUS and to maintain its strengths in advanced technologies, Australia will need to create an environment that discourages highly skilled homegrown talent from being drawn away by the global thirst for skills.

A key part of the answer lies in greater collaboration involving the Department of Defence, educational institutions and the private sector. Public–private partnerships are an avenue to nurture talent and begin addressing the skilled workforce challenges. They provide streamlined avenues for funding and education, while encouraging local and foreign commercial investment. Canberra needs to recognise its responsibility to provide sufficient government funding to facilitate the formation of public–private partnerships that benefit national security.

Australia already has public–private partnerships in the advanced technology sector that have demonstrated their viability and can serve as a scalable model for pursing similar arrangements under the multilateral framework of AUKUS.

Sydney-based startup Silicon Quantum Computing was established in 2017 out of the University of New South Wales, with $83 million in capital funding from a combination of public and private entities, including the federal government, the Commonwealth Bank, Telstra and the NSW government. The company is now a leader in quantum computing innovation largely because talented and visionary individuals were provided with a favorable innovation ecosystem facilitated through government-led and industry-supported investment.

Australia and its AUKUS partners should foster similar initiatives in a multilateral context and identify strengths in each other’s industries across the technology areas of Pillar 2. In the US, an example of a cross-border public–private partnership is the microelectronics program partnership between Arizona State University and the Taiwan Semiconductor Manufacturing Company that is aided by the US CHIPS and Science Act. This is a successful model that in part addresses the skills gap and develops the semiconductor workforce in specific areas of deficiency. It demonstrates the importance of government-driven stimulus.

The AUKUS partners will need to address additional policy considerations to more easily facilitate this, including reviewing the notoriously restrictive export controls under the US International Traffic in Arms Regulations, creating skilled AUKUS visas and education pathways, and providing tax incentives for private companies to invest in AUKUS partners’ industries where it might be more expensive than in other parts of the world.

Domestically, Australia has taken some positive steps to facilitate public–private partnerships and address the underlying education challenge. In June 2022, the government pledged to create an advanced strategic research agency, modeled on the US Defense Advanced Research Agency, to support AUKUS’s and Australia’s sovereign technology goals. The new agency’s role in linking Australian industry and universities with AUKUS allies will be a practical step towards collectively addressing the limited talent pool available to execute collective security requirements.

But greater effort is required. The 13 March AUKUS optimal pathway announcement didn’t touch on how Pillar 2 will be tackled by the partners. Nevertheless, Canberra can take proactive actions to champion public–private partnerships domestically and address domestic workforce challenges ahead of greater multilateral coordination under the AUKUS framework.

Source : Australian Strategic Policy Institute