Australia's construction industry is headed for another skills shortage, according to Troy Williams, CEO of Skill360 Australia, a Group Training Organisation that employs trainees and apprentices and places them with host employers across a range of industry sectors.

"We had a skills shortage two or three years ago. We don't have that at the moment because of the downturn, but the moment things pick up again, we will have another skills shortage," Williams said.

"The reality is we need new apprentice numbers at about three times what they are now. They weren't as they should have been prior to the economic downturn. The fact that new apprenticeship numbers have collapsed in some sectors of the building industry signals that in probably five years, we are going to have a skills shortage that is more acute than it was recently."

As part of this year's Budget, the federal government is investing $3.8 billion over four years to support apprenticeships and traineeships, avoid a skills shortage and prepare for Australia's recovery from the global financial crisis.

Incentives include a new payment called 'Tools for Your Trade' where apprentices will be given five cash payments totalling $3,800 over the term of their apprenticeship to help meet the costs of tools, books, protective clothing and fees.

Eligibility for the $4,000 incentive payment to the employers of apprentices who are studying Diploma or Advanced Diploma level qualifications will also be broadened and the Support for Mid-Career Apprentice payments will, from January 1, 2010, be extended from those aged 30 and over to those aged 25 and over.

Baulderstone has 14 apprentices across Australia, the majority of whom are working towards a trade in carpentry, however they also have yard workers who gain experience in plant equipment and heavy machinery.

According to Leah Fischer, Baulderstone's corporate communications manager, the economic downturn hasn't affected the number of apprentices working for the company, or how they are being trained. She agrees with Williams that retaining apprentices is one of the best ways to avoid a future skills shortage.

"For every year that apprentices are not employed, as time goes on, there will be a gap in the business. For example, no first year apprentices in 2009 means that by 2010 there will be no one with one year's experience, and so the gaps move forward in the business," she said.

Like Baulderstone, Laing O'Rourke is as much committed to hiring and training apprentices as it was before the economic crisis set in. Michelle Cook, Laing O'Rourke's training coordinator for Queensland, is pleased with the apprenticeship incentives and increased spending on infrastructure,  and believes that they will definitely help to increase the number of apprentices that the company employs, which currently stands at 50.

"It's business as usual for us ... I am in the process of hiring as we speak. My plan to get the numbers where I wanted them to be by the end of 2009 might not quite get to the exact number, but I can make up for that when the industry is in full swing again," she said.

It is predicted that in the near future, the construction industry will experience a surge in activity, once government spending and infrastructure plans trickle through, and according to Cook, with more work comes more of a demand for construction workers and apprentices.

"My numbers of apprentices will definitely increase. The more projects we have the more apprentices assigned. Our strategy is to maintain a minimum of 10 per cent to training and development on each project," she said.

According to Williams, however, government incentives will not do enough to avoid the future skills shortage, and he believes that two key factors have contributed to Australia's past and future skills shortages in the building and construction industries. The first is that more and more apprentices are completing their apprenticeships and moving on to become qualified tradespeople, and the second is that far less new apprentices are coming through to replace those now qualified ones.

"Fundamentally, what we need is for the private sector to be confident to take on apprentices and trainees ... The situation is getting better, I think there's not quite as much pessimism around as there was earlier in the year, but the solution will always be with private sector contractors having confidence to both keep on their existing apprentices and take on new ones, and although we are seeing a drop in the number of apprentices losing their jobs, we are not seeing an increase in the number of new apprentices at this stage," he explained.