The list of jobs where skills shortages are rife has almost doubled during the past year.
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Skills Minister Brendan O'Connor says the skills priority list growing from 153 to 286 occupations in 12 months speaks to "a really difficult challenge for this country".
Mr O'Connor said skills shortages would also continue to grow unless further investment was put into training and retaining staff in sectors facing shortages.
That includes health, education, trades, and community workers.
There has been a more than 40 per cent increase in jobs advertised in August compared to last year, with almost 310,000.
Mr O'Connor said the government has prioritised the issue by already convening a jobs and skills summit and supporting a pay rise for aged care workers.
"They should be treated and valued properly. We need to attain and attract aged care workers," he said.
The government has also increased the skilled migration cap to help address shortages in the near term, the minister told reporters in Melbourne.
The Australian Chamber of Commerce and Industry says targeted funding is needed to boost traineeships and apprenticeships.
Chief executive Andrew McKellar said any drop in take-ups would have a devastating impact on businesses.
"Our businesses are in desperate need for more staff. It will only be through improved investment," he said.
Prime Minister Anthony Albanese blamed the shortages on the previous coalition government.
"Today's report shows the previous Liberal-National government dropped the ball on supporting these opportunities," he said.
The Australian Council of Trade Unions also lashed the former government for cutting funding to TAFE and tertiary education.
Assistant secretary Scott Connolly said the federal government's signature jobs and skills summit showed investment was desperately needed.
He also called on the government to shut down the exploitation of migrants.
"Businesses must not be allowed to go back to using migration as an alternative for improving pay and conditions," he said.
Deputy Liberal leader Sussan Ley says the jobs and skills summit had failed to make any progress more than a month after it was held.
She also attacked the government for failing to pick up the opposition's proposed pension reform, allowing recipients to work more without having their benefits cut.
"If they had done that, we could have started to see older Australians take up positions in businesses that are crying out for labour," she said.
Mr O'Connor will host his state and territory counterparts for a ministerial meeting in Melbourne on Friday to discuss how best to address acute labour shortages.
Australian Associated Press
