The demand for psychologists will outstrip supply by nearly 100 percent in the next decade, a new report from the Federal Government’s Department of Health, Disability and Ageing shows.
The shortfall will be a staggering 96.6 percent by 2038, compared to 57.3 percent in 2025, according to the Department’s just-released Psychology Supply and Demand Study .
Macquarie University Master of Clinical Psychology Dr Leanne Hall said the “abysmal” statistics had promoted a training overhaul which many in the field feared would turn into a box-ticking exercise.
“The mental health workforce shortage tends to get framed as a pipeline issue, like we just need to train more people, but that’s only part of the story,” Dr Hall said.
Despite the demand there is not sufficient paid jobs coming online to soak up the interest from potential students and patient demand.
To become a registered general psychologist, students currently complete a three-year undergraduate degree.
After this, they must do an accredited fourth honours year, either a one-or-two year master’s program, and a paid one-year internship.
They are then required to complete a period of supervised registrar training after six years of full-time study.
The government has directed the Psychology Board of Australia to replace this with a single integrated five-year program from 2026.
The new training, which is under public consultation until June 10, will embed practical placements earlier, remove the national psychology exam for domestic graduates, and introduce a potential exit point after three years into a new “psychology assistant” role.
Dr Hall said, in principle and on paper, the reforms looked good because the current pathway was complex and confusing for students, the public and services.
However she said there was a distinct lack of detail in the government’s plans.
“It’s unclear exactly how practical placements are going to be embedded earlier in the training process without any additional funding allocated to the services who provide that supervision,” Dr Hall said.
Practical placements presented a significant bottleneck to workforce training because mental health services were under acute pressure, which limits their ability to take on and support registrars, she said.
“At present, there are limited employment opportunities for graduate psychologists within publicly funded services, where the need is greatest. As a result, many graduates move directly into private practice, leaving significant gaps elsewhere in the system,” Dr Hall said.
“In short, this is not simply a supply problem, it’s a system problem.”
Two in five Australians aged 16–24 experienced a mental disorder in the last 12 months, according to the most recent National Study of Mental Health and Wellbeing.
“If you want more clinical psychologists and psychiatrists to be supporting patients with complex mental health, then you need to create funding structures and community-led care models that can actually support that,” Dr Hall said.
Public mental health services tend to have narrow eligibility criteria and long waiting lists. Without access to these services, the alternative is private care. But seeing a psychologist without a Medicare referral is often prohibitively expensive.
“This is where significant equity issues emerge, with access to care increasingly determined by a person’s financial capacity rather than their level of need,” Dr Hall says.
“People are left cycling between short‑term supports, usually emergency departments, or systems that were never designed to provide ongoing mental health care… including the justice system.”
