More needs to be done by the government in Australia to encourage skilled labor migration, a new report states.

According to the study by Dun & Bradstreet, the nation is experiencing significant pressure on its jobs market and will experience talent gaps unless action is taken to address the problem.

The research indicates skilled migrant workers are required to meet growing demand for skilled employees, with the expanding economy potentially pushing up wages.

More than one in four (27 per cent) respondents to a poll by the company predicted pay will be their primary concern during the coming months, with employment expectations in the country rising to a net index of 11.

Chief executive of Dun & Bradstreet Christine Christian stated: "Policy makers will need to ensure the supply of skilled labor can keep up with demand in order to avoid wages growth adding to inflationary pressure."

The Australian Bureau of Statistics reports unemployment in the country fell over the year to December 2010 by 0.4 points to 5.1 per cent.

Posted by Sarah Dixon