Australia Is Offshoring Its Own Future Workforce

Who carries the cost?

The immediate cost lands on young Australians, and it compounds. Economists call it scarring: a slow start in entry-level jobs depresses earnings and progression for years. A 22-year-old who cannot find a first professional role is more likely to be underemployed at 30.

The second cost lands on the businesses that will need experienced staff in a decade. Li and Kumar put it plainly: Australia risks keeping the brands and customers while losing the expertise underneath. A country that stops training juniors becomes dependent on importing seniors.

The third cost is fiscal and social. Every young person who misses the transition into work relies on income support rather than paying tax. Regional Australia feels it first.

Consider how the effect of offshoring plays out across the four sectors SBAAS works with:

• Professional services. The graduate who would have become your senior accountant in 2032 never did the 200 reconciliations. Succession now depends on poaching or sponsoring.

• Trades and services. Fewer apprentices today means fewer licensed tradespeople and supervisors in five years. Labour costs rise, and the businesses that trained lose staff to those that did not.

• Allied health and NDIS. Practices increasingly offshore reception, plan management and billing. Those were the entry-level jobs that produced practice managers. Clinical roles cannot go offshore, but the operational backbone can.

• Not-for-profits. Finance and administration functions are prime candidates for outsourcing on tight budgets. A shared service replaces the junior coordinator who learned grant acquittals on the job, and the sector loses its future finance managers.

Why small business holds most of the answer

Australia has around 2.5 million small businesses, close to 98 per cent of all businesses. Most first jobs happen in one of them, not in a bank tower.

That gives small-business owners more influence over entry-level jobs than any other policy lever. It is also a competitive advantage. A firm that trains its own people builds loyalty, knowledge and a succession pipeline competitors cannot buy.

The challenge is designing entry-level jobs that still make commercial sense when the volume work has gone. The old model, where a junior spent two years on processing and absorbed judgement by osmosis, no longer stacks up. The new model has to be deliberate.

Designing entry-level jobs that survive

The approach below works for a three-person bookkeeping practice, a 20-person electrical contractor or a 50-staff NDIS provider.

Step 1: Separate training tasks from commodity tasks

List every task a junior currently does, or would do. Sort each one into two columns. Commodity tasks are high-volume, rules-based and interchangeable: data entry, transaction coding, basic scheduling, document formatting. Training tasks build judgement: client conversations, reviewing exceptions, diagnosing why a job ran over, drafting advice. For each task, note two numbers: how easily it could move offshore or into software, and how many learning hours a week it gives the junior.

Commodity tasks can be offshored or handled by an AI tool without damaging your pipeline. Training tasks stay with your junior, even when it is cheaper to send them elsewhere. The cost difference is your training budget.

Step 2: Build a 12-month pathway with named milestones

Write down what the junior should be able to do at three, six, nine and twelve months. Attach each milestone to a real task and a real reviewer. In an allied health practice, that might be: run the daily billing reconciliation by month three, manage the NDIS claiming cycle by month six, train a new receptionist by month twelve.

Structured pathways matter more when the volume work is gone. Without them, entry-level jobs at an AI-enabled firm become a year of watching rather than doing.

Step 3: Pair juniors with the tools, not against them

Jobs and Skills Australia found generative AI is more likely to augment work than replace it, especially in skilled occupations. Give your junior ownership of the AI tools and the offshore relationship. Make them the person who checks the offshore bookkeeper’s output, briefs the overseas developer, or audits the AI-generated draft. That is judgement work, and it is exactly what entry-level jobs should now contain.

Step 4: Use the incentives that exist

The Australian Apprenticeships Incentive System pays hiring incentives for apprentices and trainees in priority occupations. States run their own payroll tax and training subsidies. Settings changed in the May 2026 Federal Budget, and Ai Group has warned employer support is at its lowest level in decades. Check current rates on apprenticeships.gov.au before you plan a hire, and build them into the cost model.

Step 5: Measure retention, not just headcount

NCVER found the four-year completion rate for non-trade traineeships had fallen to 42.7 per cent for the 2021 cohort. The main reasons were pay, conditions and personal circumstances, most of which an employer can influence. Track completion and 24-month retention for every hire into entry-level jobs. A pathway that loses half its juniors is a cost, not an investment.

What government and large business should be doing

Small businesses can protect their own pipeline. It cannot fix the national one alone. Large companies should disclose which capabilities they move offshore and how they will maintain training for local talent.

Apprenticeship incentives should stop being changed with every budget. And government buyers can weight tenders toward suppliers that create entry-level jobs for Australians, as they already do for local content. None of that requires stopping offshoring. It requires making sure offshoring complements, rather than replaces, the country’s ability to develop its own workforce.

Frequently asked questions

They are increasingly the same decision. Officeworks and Woolworths paired offshoring with AI in the same announcements. Both remove the volume tasks that entry-level jobs were built on. Australian evidence points to slower growth in exposed occupations rather than outright loss. The US data shows a widening gap for young workers that Australia would be unwise to ignore.

Not broadly, yet. Indeed found graduate postings were still 1.5 times their 2019 level in 2025. The concern is composition: fewer entry-level jobs in exposed occupations and a thinner pathway from junior to senior roles.

Yes, and the best firms do both. Send commodity processing offshore. Keep judgement tasks, client contact and review work with your junior. Give the junior responsibility for managing the offshore output so the relationship becomes part of their training.

The Australian Apprenticeships Incentive System pays incentives for priority occupations, and states offer payroll tax exemptions and training subsidies. Settings changed in the May 2026 Budget, so verify current amounts at apprenticeships.gov.au before committing.

It matters more. Not-for-profits run on tight administration budgets and are prime candidates for shared-service outsourcing. The junior coordinator role that produced the sector’s finance and program managers is disappearing first. Protecting one of these entry-level jobs per organisation is a governance decision, not an HR one.

The bottom line

Offshoring is a rational decision for each company that makes it. Taken together, those decisions eliminate entry-level jobs where Australians learn skilled work. The labour market has absorbed the effect of offshoring so far. The pipeline has not.

The businesses that will have senior people in 2036 are the ones designing entry-level jobs for them now. SBAAS works with owners across professional services, trades, allied health and the not-for-profit sector on workforce structure, role design and succession planning. To talk through what your own first rung should look like, read more about how we work and book a conversation at https://sbaas.com.au/about-us/.