South-west businesses continue to suffer chronic staff shortages ahead of the summer peak

Warrnambool and the south-west region continue to lead the country with an unemployment rate of just 1.3 per cent, according to Australian Bureau of Statistics data.

This was ahead of Bendigo which had a rate of 1.7 per cent, while in Ballarat it was two per cent and in Geelong 2.4 per cent.

The regional unemployment rate of 2.9 per cent has stayed near all-time record lows - and the lowest of all the states.

The national rate sits at 3.1 per cent.

Pavilion Cafe and Bar owner Jon Watson said while staffing shortages had eased slightly on last summer he was still in desperate need of kitchen staff.

"I've got a terrible chef shortage. Front of house, if you'd asked me a week ago I would have said chronic but it's getting better," he said.

"I still need four in the kitchen and I just don't know where I am going to find them.

"I'd love four full-timers.

"As business owners, we've never worked more than what we have in the last year.

"We're there seven days a week really.

"Hopefully that will get better."

But he said there was a chronic shortage in every industry.

After attending a government-organised jobs skills forum recently, he said everyone had the same story of staff shortages across all industries.

"The other thing that is worrying from a hospitality point of view is this is gearing up to be the biggest summer we've ever had because people are just so excited about getting out of Melbourne and getting away," Mr Watson said.

"Talking to the hotels, everyone is so heavily booked already.

"We are two months out from Christmas yet most people are saying they're booked out.

"It will be a big summer."

Mr Watson said people avoiding flooded parts of the state would come to the south-west.

"It's having the staff to be able to service them," he said.

"There's quite a few businesses not working to their full capacity due to the staffing issue."

Mr Watson said the Melbourne Cup long weekend had brought in more tourists than usual.

"We were doing numbers that we normally wouldn't do unless it was January," he said.

So many visitors commented that they had changed their long weekend destination due to the floods elsewhere, he said.