A few months ago, the Australian Federal Government hosted a summit to address a critical shortage of workers to fill jobs. Could that party be over?
An October survey by Reserve Bank of Australia (RBA) reports a significant falloff by businesses intending to increase the number of people they employ. As reported in an excellent article on the national broadcaster ABC’s website, hiring intentions to increase staff headcounts have fallen from 70 percent to around 55 percent. The impact of this is expected to contribute to a rise in unemployment over the next 2 years.
On the upside, very few businesses are expecting to reduce their headcounts, therefore putting a lid on future rises in unemployment. “It remains to be seen whether employers will reduce or increase their workers’ hours as a trade-off for not reducing headcounts,” said Workers to Hire founder Michael Hargreaves. “What is for certain, employers and consumers facing a headwind of increasing operating and living costs,” Michael Hargreaves added.
It is significant that businesses are unlikely sack workers, given that the Federal Government has successfully sought to increase the minimum wages of Australia’s lowest paid workers. Around 25 percent of Australia’s workforce is employed on the minimum wage or under an award. The implications of increasing the minimum wage include increased penalty rates and superannuation costs to employers.
The rationale for increasing the minimum wage is a consequence of real-wage stagnation over recent years and exacerbated by inflationary pressures on the cost of living since the RBA first increased interest rates in May this year. In what has become a monthly habit, increasing interest rates are putting pressure on the disposable incomes of average and lower paid workers with mortgages. A flow-on to rents is expected soon, and this too will add to inflation.
Various media commentators are now predicting that the RBA will take their foot off the interest rate pedal as discretionary spending shows signs of easing. Cashed up professional workers in well paid secure roles have largely created the secondary demand for lesser paid hospitality and retail jobs. This is evident by near full occupancies for getaway accommodation where the price for a weekend stay exceeds the minimum weekly wage.
What we are seeing in response to rising living costs in higher paid professionals shifting jobs, or bargaining higher salaries, at around twice the rate of lower skilled workers, according to statistics published by the Australian Bureau of Statistics (ABS). We are also witnessing an increase in the number of workers having more than one employer. Mobility and multi-employment are at record highs.
Statistics republished by the ABC find that the number of people holding more than one job “rose by more than 4.3 percent in the three months to June. Almost 900,000 working-age Australians now have more than one job. Workers seeking second jobs and recent retirees seeking to re-enter the workforce are the primary catchment of the newly launched website workerstohire.com.au.
Highly paid professionals on the career treadmill, who work some of the longest hours in the developed world, are not the predicted catchment of Workers to Hire. “These workers,” said Michael Hargreaves, “post their career achievements on sites like LinkedIn and respond to online job boards like Seek.” “By contrast, workers seeking lesser skilled roles post a profile on Workers to Hire for free, just like the do on social media.” Employers apply to candidates on the site, rather than the other way around.
The Workers to Hire website is positioned between careerists seeking full-time employment and short-term freelancing by professionals to multiple businesses. Because Workers to Hire charges minimal fees to contact a candidate, workerstohire.com.au is predicted to be a game-changer for small-to-medium size employers who’ve been constrained by the cost of advertising or by their location to put up signs.