Engineering a way out of the skills gap

By: Danis Hidayat Sumadilaga and Moekti P. Soejachmoen

This op-ed was published on The Jakarta Post on 13 July 2023.

The late biochemistry professor at Boston University and science fiction writer, Isaac Asimov, once quipped, “Science can amuse and fascinate us all, but it is engineering that changes the world. ”

The potential for engineering to change the world has been enhanced by a new Mutual Recognition Agreement (MRA) between Australia and Indonesia. Signed on 30 June 2023 by Engineers Australia and the Institution of Engineers Indonesia (PII), and part of the Indonesia-Australia Comprehensive Economic Partnership Agreement, the new MRA will support, for the first time ever, the exchange of skills between Indonesia and Australia to build mutual engineering capacity.

The MRA developed from a series of discussions and exchanges of experiences between the two peak bodies over the past 1.5 years. These discussions improved understanding of each country’s assessment of qualifications, independent practice, registration and credentialing for engineers. The resulting MRA is a major achievement that would not have been possible without some commonalities in qualifications and assessment standards across the two countries.

The MRA is therefore a testament that the qualifications and credentials of Indonesian engineers are on par with Australia. It opens up a new opportunity for Indonesia to leverage its abundant human resources to expand its services exports.

And the timing couldn’t be more perfect. Both Indonesia and Australia are facing skills shortages
especially for roles with greater technical specialisations, such as engineers.

In a 2021 discussion paper on engineering skills, Infrastructure Australia predicted that by next year demand for engineering skills in Australia would be 48 per cent higher than supply. Aircraft maintenance, civil, electrical, geotechnical, and mechanical engineering are all currently in shortage, with strong continued future demand predicted.

Likewise, Indonesia’s push for better quality infrastructure brings new challenges. Engineers are among the country’s top 20 occupations in short supply, according to a 2018 World Bank report. Construction managers, civil engineers, chemical engineers, environmental engineers, production engineers, and process engineers are all in critical shortage. According to Bappenas and the Japan International Cooperation Agency, over the next three to 10 years Indonesia will continue to have insufficient domestic supply for skills like structural engineers, network engineers, data engineers, and project managers for specific construction projects, such as tunnel construction.

The new MRA provides a welcome solution to these supply and demand constraints. It also establishes a single conformity assessment process rather than two separate ones, which will reduce transaction costs and increase administrative efficiency, leading to an increase in services trade.

Individuals will benefit on a very direct level from the new agreement. Australian states have long recognised the Engineers Australia assessment standards, and now, certified Indonesian Professional Engineers going through MRA pathways will also enjoy such recognition when they apply for a state practice license, as compared to the lengthy standard pathways.

The MRA also facilitates cross-border migration of credentialled engineers in matching areas of mutually-agreed practice or disciplines, and provides a future pathway for new or emerging areas to be included without renegotiating the MRA.

The MRA also brings benefits back to engineers’ home countries. Returnee professionals can transfer their knowledge to local colleagues, building flows of knowledge and peer learning. It is targeted at highly experienced engineers, who have a minimum of seven years’ post-graduate practical experience and at least two years managing significant engineering work. These experienced and qualified professionals can therefore make real contributions by transferring their knowledge and nurturing their local engineer community after gaining international experience.

The MRA is an encouraging milestone that recognises the quality of Indonesian professional engineers and paves the way for greater bilateral cooperation.

And this is just the beginning of the journey. With sufficient uptake of the MRA, there are many more
opportunities ahead for Indonesian engineers.

Danis Hidayat Sumadilaga is the President of the Institution of Engineers Indonesia (PII) and Moekti P. Soejachmoen is the Lead Adviser for Market Access at the IA-CEPA Economic Cooperation Program Katalis.