Australia’s job market recovering better than some G7 nations

Record levels of vacancies

There are some significant bumps along the road as the labour market continues to recover from the worst effects of the Covid pandemic. A record level of vacancies in Australia has been a headline statistic recently, causing headaches for agencies as they seek talent. This mirrors the experience of UK recruiters.

One of the reasons for such large gaps in the supply of talent has been the number of inactive workers, also known as the participation rate, the share of the population that is working or looking for jobs.

Some of the key reasons for high inactivity/low labour force participation rate include:

• Child and social care costs – some of the inactive have decided to ditch work and care for children, elderly or disabled relatives – it simply makes economic sense to them, given the high cost of care and the shortage of resources in the care sector
• Sickness – the severe backlog in socialised healthcare treatment and the effects of long Covid are partly responsible for swelling the ranks of the long-term sick
• Education and training – others that are classed as inactive have chosen to ring the changes and have left work to enter education or retrain for new careers or opportunities

However, Australia differs significantly from the UK, which has seen as many as 1 million workers disappear!

Australia outperforms UK in turning the tide of inactivity

Australia is outperforming nations in the G7 (allegedly the world’s largest developed economies), such as the UK.

Australia hasn’t only got more economically inactive people back to work, it’s got more back than pre-Covid – it has actually reversed the trend for inactivity that it saw before the pandemic hit.

Across the world, skyrocketing costs are creating upward pressure on wages. Increasing wage demands only serve to feed inflation, but when talent is in short supply, it​​ is a candidate-led market and ultimately pay and reward packages become pivotal to securing the skills that agency clients need.

That’s OK if agency clients are in a booming sector where growth is strong. However, there are many businesses in some sectors where there is a need to restore profitability before upping the wages, and offering increased salaries poses some challenges.

Maintain your focus on core recruitment issues with ETZ

For recruitment agencies, the market continues to be challenging while offering opportunities. To maintain focus on the core activity, recruitment businesses need access to reliable, best of breed technology.

ETZ’s leading timesheet, invoicing and payment solution, streamlines the back office processing of your recruitment agency. Our complementary solutions, ETZ Comply for onboarding and document management, and Caspian for business intelligence give agencies further capability to streamline and uncover opportunities.

ETZ is the RecTech partner of choice, helping agencies to navigate the pitfalls and obtain excellent value from technology. To find out more, call us on +61 (0) 405 458 821 or book a demo.