Both major parties need to do more to help with the current skills shortage, especially among young unemployed people in Western Sydney, the small business peak body says.
The chair of the Council of Small Business Organisations of Australia Matthew Addison says that while the COVID-19 pandemic impacted the number of international workers coming into the country, it also saw a slowing in training locals.
"There has been a lack of people developing their skills," Mr Addison said.
"There has been a lack of willingness to engage trainees, and therefore we have got that whole flow-on effect, it's going to take a little while to recover."
In Sydney's south-west, the owner of Bonnyrigg Tyres & Mechanical Simon Grima had struggled to get skilled workers before the pandemic.
"But I think COVID has made the problem worse," he said.
"There has been an increasing demand for skilled labour, I have been contacting local TAFE colleges trying to get employees, it is making it hard to run a business."
Mr Grima was forced to return to the shop floor due to a lack of junior mechanics.
"We are losing our trades because they are going to do work where no qualifications are needed and getting higher wages."
A mismatch exists, according to Mr Addison, between the low unemployment rate nationally, and that of young people in parts of Western Sydney.
According the Australian Bureau of Statistics labour force data for January, the unemployment rate remained at 3.5 per cent, while the youth rate was at 7.8 per cent.
Organisations working in Western Sydney, including Wesley Mission, said parts of the region had double that rate, especially among jobseekers from a disadvantaged background.
"We have this real mismatch between the low unemployment rate nationally, but high rates of unemployed youth," Mr Addison said.
"To engage unemployed youth in the small business sector, it needs a real willingness and ability to train them up over a period of time."
He acknowledged the current high costs for business, coupled with rising interest rates and inflation has made that difficult.
"While the economic environment is so tight it's quite hard for a small business to embark on that training," he said.
"We are looking for the next NSW government to continue support, so they [small business owners] can engage with younger staff needed for their different operating environments."
NSW Labor on Sunday launched its official election campaign, including a promise of an extra 1,000 apprentices and trainees for state-run agencies if it wins on March 25.
It's in addition to TAFE announcements made by both major parties.
Last week, the Perrottet government launched its small business strategy, with a promise to increase the sector by 20 per cent by the year 2030, along with better access to training.
For Mr Grima, the overall decline in local manufacturing in recent years is to blame, which has seen less workers being trained in vocational skills.
"We are losing all our manufacturing, and one day we are going to find all our skilled people, our labourers are from overseas as there no trades in Australia," he said.
