More than 120,000 new workers will be needed in the tourism industry over the next five years.
That includes about 60,000 skilled workers, The Australian Tourism Labour Force report, commissioned by Austrade and produced by Deloitte Access Economics, has found.
The report, released on Wednesday, estimated there is a shortage of about 38,000 workers now, with NSW, Queensland and Victoria the key areas.
There was a decrease in the number of businesses reporting recruitment and retaining difficulties on 2011 figures.
But half still said they have problems recruiting staff and just over a third have trouble retaining workers.
Nearly 70 per cent of businesses identified skills deficiencies, up 19 per cent in four years.
"It appears that while the ability for businesses to hire workers has improved, businesses are not finding the skills they need to operate effectively," the report said.
"This may ultimately be affecting the productivity and competitiveness of the sector."
There has also been a reduction in the use of overseas workers, now making up 10 per cent of the sector, down from 13 per cent in 2011.
