Positively, a significant number of respondents in the following industries expect headcount to increase: construction, digital, engineering, legal, property, tech, retail and not-for-profit. The most positive of survey respondents are in digital, with 75% of respondents indicating that hiring activity is slightly stronger or stronger when compared with last year.
Demand for entry level employees is expected to increase but mid-level candidates are the most in demand for the majority of industries, but has dropped year-on-year.
Consumer product and digital are the most optimistic industries, with the most respondents (over 37%) expecting a 6-10% bonus. Government (90%), not-for-profit (87.7%) and transport (63%) are the most pessimistic industries, expecting no bonus.
“Over 64% of respondents believe the main advantages of contracting are flexibility for the company, and helping to address short-term needs and 41% believe it's cost effective”
“The top two reasons for employees leaving their current organisations are limited career progression and seeking a new challenge”
“Demand for entry level employees is expected to increase but mid-level candidates are the most in demand for the majority of industries”
63% of respondents currently use contracting solutions in their organisations, but a total of 68% said they are willing to consider using contract workers. Employers in engineering, transport and government industries are the most likely to use contractors, while professional services are least likely.
Over 64% of respondents believe the main advantages of contracting are flexibility for the company, and helping to address short-term needs and 41% believe it's cost effective. However, 93% believe that contracting will not help develop the business in the long run and consistently across most industries, most indicated preference to invest in permanent solutions rather than contractors as the top reason for not hiring contractors.
The top two reasons for employees leaving their current organisations are limited career progression and seeking a new challenge – this is fairly consistent across all industries with the exception of mining and resources (48.5%) and technology (44.4%), where stagnant remuneration is more important than seeking a new challenge.
Most industries place diversity as a medium to high priority except for agency (50%) and agriculture (42.9%) where the majority indicated it was a low priority in their companies. Manufacturing and property industries are the most likely to have no diversity policies at all.
Residential building activity is forecast to remain solid into 2017. This is supported by elevated approvals, low mortgage interest rates, strong population growth and significant urban transport infrastructure developments.
The industry continues to prefer resourcing projects with permanent employees rather than contractors. Only 49% of construction companies use contractors, which is 28% lower than the overall average. Half of the companies who do not, however, are willing to consider it, citing it as a cost effective solution to resource shortages.
Roles currently in the highest demand are contract administrators, site managers and estimators.
Most property and construction professionals expect an increase in the next 12 months, with construction professionals expecting marginally more than their property counterparts. Global economic conditions are considered a significant factor, but the main one is the domestic economy.
The majority of workers do expect an increase in line with CPI however, although no one is expecting anything over 15%.
Turnover in the industry looks set to be in line with other industries, with reasons for leaving following a similar path; stagnant remuneration, limited career progression, and desire for new challenges taking out the top spots. Another driver is a move to client side property positions. A huge 60% say that a pay increase would make them stay.
Overall the construction market remains talent short with residential builders still working through an enlarged construction pipeline. Nearly half of surveyed businesses expect to increase their headcount in 2017, with the majority being mid-level hires.
Irrespective of the end of booms in two major construction sectors of resources and residential, the non-residential building work is growing, especially in the areas of health and aged care, student accommodation and retail which will help to rebalance and refocus the industry.
Probably the biggest and most interesting trend across the digital market is the investment by organisations towards building in-house teams and moving away from agency reliance. This is due to organisations increasingly want end to end ownership of their customer experience. Many employers will now opt for a hybrid model, where they can still maintain their agency relationships for elements of the digital mix. For recruitment, this means many of the roles in demand are for digital marketing generalists that are across all areas of digital and not specialists in one area.
Businesses are now dedicating significant proportions of their marketing budget to uplifting and growing their digital presence while also investing in increased salaries to secure the best available digital talent.
Content is still king in the world of digital engagement. Detailed content strategies with a focus on producing specific and relevant content has increasingly been a focus that brands utilised to engage and acquire new customers. This can be across a wide variety of mediums such as blogs, interviews and videos – challenging the status quo and being seen as thought leaders in their particular industries are common themes.
Digital analytics roles have been the focus of many established digital teams. Businesses are looking to invest in analytics, understand the data and use digital measurement to truly understand their customers and the market. This can then be used to inform business strategy and drive the digital agenda. Because of this, blending technical abilities with strong communications and stakeholder management skills are top priorities for employers hiring digital talent. Other roles in demand include; SEO/SEM experts, digital campaign managers and social media executives (entry level as well as managers).
In the next 12 months the need for digital talent is only going to grow, organisations will continue to evolve from traditional marketing methods and transition towards having a primarily digitally led focus with specialised heads in each role. Digital candidates will have increased control over their salary packages as they become more aware their skill set are in high demand. Organisations will also continue to source digital talent from areas such as the UK/US where these markets are a step ahead of Australia in terms of digital trends.
There has been significant growth within service and maintenance in the engineering and manufacturing sectors as businesses have had capital expenditure budgets reduced and operational budgets increased. This has led to a rise in roles within reliability and optimisation as businesses are looking to extend the lifespan of existing equipment rather than make new purchases.
There is less interest in candidates with oil, gas and mining specific experience as there is perceived difficulty transferring that over to other industries and more focus on candidates with traditional manufacturing experience.
Diversity and inclusion seem to be of a lower priority than in other industries, with only 46% of engineering respondents saying it is of high priority and there are programs in place.
Hiring remains steady across all sectors, with new challenges and limited career progression the biggest drivers for moving on, with individuals also citing personal reasons and team dynamics as reasons for leaving their current roles. Personal reasons are much more heavily weighted than other industries, at 35%.
Soft skills especially, the ability to interact with clients and stakeholders are currently seen as very important and are the deciding factor in most roles. Particularly in demand are:
With an extremely high demand for building service engineers.
Manufacturing is the most optimistic sector, with 76% expecting a 1-5% increase. Engineering (55%), mining (72%), and oil and gas (80%), are more likely to not expect a salary increase.
Economic conditions are more likely to impact salary and bonuses, than performance. For manufacturing (56%), domestic conditions have a greater impact while for mining and resources, global conditions have a greater impact (94%). For engineering, domestic conditions and performance are seen to of equal importance.
Similar to salary results, industries that do not expect salary increase, are also more likely to not expect any bonus.
With foreign exchange rates at their current constant, future growth is expected in both the domestic and export manufacturing markets with a focus on new product development and continuous improvement. This is particularly strong in the consumer goods sectors. Within engineering, the focus is on infrastructure and transport.
Over the past 12 months there has been a significant increase in newly created headcount within the not-for-profit, healthcare, education and aged care sectors. This occurred due to the commercial and government investment within infrastructure projects, predominantly in NSW and VIC, for healthcare and education, combined with legislative changes within the not-for-profit sector resulting in a focus on driving efficiencies. In addition to this, more multinationals are investing in Australia, and the first function they create is their finance team. This has led to an increased demand for finance professionals here.
Finance discipline seems to be more optimistic, with 81% expecting 1-5% increase, higher than overall average of 72%. All respondents in government and not-for-profit sectors expect 1-5% increase in salary but are most pessimistic with regards to bonus payment, 93% and 91% not expecting any increase respectively.
FD/CFO level individuals, currently in employment, are changing their passive search status to a more aggressive search for a number of reasons. They are focused on role fit – ability to add value, drive change, a challenging circumstance (where they can show their capability), a CEO/MD to truly partner with, clear KPIs and milestones within their first year.
Organisations are investing in business partnering roles, including management accountants and financial analysts. The ability to influence a peer through communication is valued and assessed in almost every interview. With the market shifting to business partner/FP&A type roles, the need for strong technical capability around accounting standards, compliance and reporting is an absolute must and salaries have increased to reflect this.
Contracting positions have been in particular demand, with employers bringing contract staff in to complete key projects. Only 24% of those not using contracting solutions are willing to consider contracting.
Commercial risk and assurance roles are also in demand – particularly within industry and commerce, banking, public sector and consultancies providing services to these sectors.
The offshoring of business intelligence, management and financial reporting will ideally create efficiencies gained, allowing leaner finance teams to provide a higher level of commercial decision support to a business.
Finance professionals will increasingly consider SME market opportunities – the traditional path for accountants has been to start at the bottom of a large corporate, progress up and when the opportunity presents itself, move to another large corporate. In an SME, the role is usually broader and more autonomous which allows an individual to provide more value – an incentive which is becoming more popular.
A high demand for a flexible workforce has resulted in a need for strong talent in the contracting space – this has been at all levels but particularly in the change management and senior generalist space. Nearly 60% of companies are using contractors as part of their regular workforce. 83% of those believe that contracting helps source for candidates for perm positions and offers flexibility in the short-term to meet company needs.
There is also a trend towards businesses up skilling internal talent and developing internal staff into senior level roles such as HR director rather than going to market to recruit.
Currently the most in demand roles are internal recruiters, HR business partners and learning and development specialists.
Limited career progression opportunities is the biggest driver for HR professionals to move on, with many seeking a new challenge.
Scope for career progression is the main attraction and retention policy at 65%. HR professionals are also demanding an increase in workplace flexibility and salary when considering new opportunities.
This is in stark contrast to the benefits that HR professionals say are already in place at their companies.
Human resources is more optimistic than other disciplines when it comes to salary increases, especially in the not-for-profit sector, where all respondents expect 1-5% increase. This is compared to the industry average of 80%.
This was expected to be dependent mainly on individual, team or company performance rather than domestic or global economic conditions. In the wake of the Brexit vote this could change significantly in a short period of time.
When it comes to bonuses the industry is evenly split, with 50% of HR professionals expecting to receive one.
In the next 12 months it is expected there will be an increased demand for HR professionals with skills beyond the generalist space, specifically a need for them to have experience in remuneration and benefits as teams become leaner and more efficient. Offshoring of roles is expected, along with an increase in the need for data analytics specialists as new analytics and HR data systems are introduced.
The pace of change in the legal market has been high in recent months and this will continue to be the trend with the increased use of technology-led processes and clients continuing to demand more value for money. Both law firms and in-house teams are working hard to differentiate themselves in the market in order to attract high calibre law professionals – this has meant fierce competition for the best candidates in an already candidate short market.
An interesting trend over the last 12 months has been the noticeable increase in the use of social networking sites such as LinkedIn and Twitter as firms ramp up their marketing promotional activity, as well as law professionals themselves looking to grow their professional networks to acquire new business or for the potential of leveraging a professional relationship in the future. Presumably, this will continue into 2017.
In terms of salary and remuneration, the legal sector is more conservative than others, with no law professionals expecting a salary increase over 5%. Remuneration is a key reason for staff turnover, consequently, salary increment is the second most important factor in attracting talent.
The demand for property, corporate, IP/IT, commercial and banking still outstrips supply as the skills gap in the market continues. In these specific practice areas firms would be wise to widen the candidate pool as much as possible – including considering candidates at a lower level, those looking to relocate to Australia and in-house law professionals who are looking to move into private practice. There are plenty of candidates with relevant experience who can be brought in quickly to meet this demand, while being trained in private practice.
Confidence in the legal market should continue to grow with strong hiring activity across both private practice and in-house legal teams. 70% of law professionals expect to see headcount increases over the next 12 months and 62% expect steady hiring, a far more confident outlook than the majority of professions. Boutique firms will continue to strengthen which should lead to a higher demand for candidates which will have an impact on movement of law professionals from either in-house teams or larger law firms. Demand for in-house lawyers in a number of areas including FMCG, retail, telecoms and technology should continue over the next 12 months, so candidates with experience in these areas should be top of employers’ wish lists. Further demand for in-house lawyers is expected to grow due to the increase in legislation and a focus on risk management, specifically in the SME space.
Businesses are increasingly becoming more aware that to stay relevant in the current market conditions, the traditional four ‘P’s (product, price, place and promotions) are no longer all that matters. As all organisations shift focus more towards the thoughts/feelings of the ‘customer’ skill sets in highest demand (and most likely to receive above average salary increases) are CRM, insights, acquisition, loyalty and analytics focused roles.
Many employers continue to leverage a ‘try before you buy’ model and offer candidates fixed term/interim contracts over immediately permanent positions. Based on this the need for temporary and contract marketing professionals has increased since this time last year. Organisations are favouring engaging employees on a project-to-project basis, however only 13% of those not currently using contracting solutions are willing to consider it in the next 12 months.
Given this engagement shift employers tend to be more flexible on candidates’ experience when hiring contractors, provided the appropriate behaviours are illustrated. Candidates are becoming increasingly more open to contract/interim assignments if they provide an opportunity to explore a different industry or broaden their skill set.
There have been consistently high levels of hiring activity across the not-for-profit sectors as organisations become more business-savvy and as a result are seeking senior level marketing candidates from more corporate commercial backgrounds. In the FMCG space businesses are flattening the structure of their teams resulting in candidates taking on heavier workloads. This shift has started to impact engagement and morale with candidates across the sector thus leading to a general feel from candidates to explore their options. This is in contrast to marketing teams in general, where candidates have expected and generally seen better work-life balance.
Over the past couple of months there have been a significant number of changes within the services sector, in particular financial services where changes in leaderships are resulting in restructures.
Advances in technology will continue to limit pure traditionalist marketing roles so candidates should prepare to up skill themselves in evolving digital marketing trends. There has been a rapid adoption of in-house digital roles migrating across from agency side. The recent restructures within financial services will see significant opportunity in this area.
Actionable analytics, snackable content, Big Data and clickbait are just some of the buzzwords you should expect to hear about over the coming months as the utilisation of data helps brands understand more about their customers in their acquisition and retention efforts.
The procurement, supply chain and logistics sectors are going through a period of change designed to improve efficiency and reduce costs. There has been offshoring of transactional functions and a focus on strategic procurement and supply chain at head office level, with less focus on people with purchasing experience and more on those with end to end experience. Value add is the current key word, with some functions being decentralised.
All respondents in procurement for government sector, indicated steady to strong hiring activity. 50% of respondents in procurement for the industry and manufacturing sectors, indicated slightly weaker to weaker hiring activity. Supply chain is more pessimistic with over 40% indicating weaker or slightly weaker hiring activity, compared to overall average of 28%, especially in the manufacturing industry.
The logistics and distribution sectors expect investment in both systems and headcount.
Mid and entry level roles are most in demand, but specialists are also needed significantly more than in other industries.
A huge 81% of respondents from the government industry and 71% from manufacturing are using contracting solutions. The majority believe that the contract roles get paid more than permanent employees, contrary to the overall average.
Procurement: there is high demand for category managers, procurement analysts and those with strategic sourcing experience.
Supply chain: steady demand for supply chain managers, supply chain analysts and demand planning analysts.
Logistics: distribution centre managers and professional warehouse managers, especially those who are systems savvy with managerial and full end to end supply chain experience are sought after, as are logistics and operations managers.
70% of procurement and supply chain professionals expect a raise this year.
When it comes to bonuses they are more pessimistic, with 66% expecting no bonus, compared to the overall average of 49%.
Procurement functions within many business will continue to become a more strategic offering to support the cost reduction initiatives which most businesses are undertaking. Investment in headcount, though generally low, will primarily be at a mid to senior level as a number of transactional functions continue to be offshored.
Reviews of where the procurement and supply chain functions belong will continue, as well as review of how the function should be structured.
There will be continued high demand for strategic procurement professionals, especially those with experience in structuring a business partnering function, writing policies and procedures and following that through to implementation.
Across the previous 12 months we have seen a buoyant market for property professionals nationally with relevant local experience, across both the private and public sectors. Within the private sector the majority of positions recruited have been permanent positions, whereas within the public sector the vast majority of positions recruited have been contracting positions. The Sydney and Melbourne markets continue to see a high demand for both client side project managers as well as facility management professionals with strong presentation and communications skills.
Half of the workforce now has flexible working arrangements, with technology provided to allow home access. A significant portion are reaping the benefits of corporate wellness programmes and social responsibility activities, allowing them to spend time giving back to the community without losing commission or base pay.
The industry is expecting to expand, with over 60% predicting they will increase headcount in the next 12 months, mainly at mid and entry level.
Limited career progression opportunities are the biggest driver for property professionals to move on, with individuals often seeking a new challenge. Stagnant remuneration is also a key driver for individuals to seek a new role.
There continues to be a very strong demand for qualified project managers with strong communication and presentation skills, particularly in the Sydney and Melbourne markets. There is a high demand for project managers with health, aged care, retail and also education industry experience.
Development managers with both residential and mixed use experience have also been in high demand across the last 12 months. Mixed use development projects in under-utilised areas of capital cities will be more and more prevalent across the next 12-24 months.
Corporate facility managers with strong communication and presentation skills will continue to be in demand. There are also an increasing number of employers choosing to recruit candidates with hospitality industry experience into frontline facilities management positions. Corporate facility managers with activity based working experience are also currently sought after.
Most property professionals expect an increase in the next 12 months, reasons being mainly based on team and company performance.
The average bonus is expected to be between 1-5%, but a staggering 11% of respondents expect over 20%.
As the battle for relevance continues in the retail space, organisations are now focusing on the total ‘experience’ that consumers have with every interaction – be it online or in-store. The consistency and relevance from ‘on’ to ‘off’ line will continue to define the key success of a retailer in current challenging market conditions. Based on this shift and following a number of years of importing talent from mature international retail markets who have already started to win this battle with consumers, the focus on talent has shifted to the development of local candidates. While international candidates are not totally being discounted, they are generally only being considered at an executive or senior leadership level.
The increased focus on local candidate attraction has given those with in demand skill sets, such as planning and design to command higher salaries within existing roles and when exploring external opportunities. Where demand cannot be met in like-for-like sectors employers are looking to related industries, such as hospitality or wholesale sales to widen the talent pool.
With the evolution of consumers’ continued trend to exhibit DIY behaviours in the kitchen and around the home there will significant growth in the home, trade, food services and supermarket channels. As with previous years, Australians continue to soak up changes in fashion and popular culture trends and this has been no different as fashion retailers continue to work hard to stand out.
Merchandise planners, store/assistant store managers and space/design planners continue to be the roles in highest demand. This is generally down to organisations continuing to look for an ‘edge’ on how they can make each inch of the ‘bricks and mortar’ space count while also ensuring the in-store experience is outstanding. Franchise recruitment/development roles also continue to be talent short as franchise platforms work hard to provide appropriate support to their franchise networks. There has been significant growth in fashion and food services based roles as consumers become more educated in these areas and the choice available develops further. Overall and across all job types, strong commercially minded and mentally agile behaviours in candidates continue to be highly sought after by employers.
The dynamic of sales teams and the remuneration and benefits they are demanding has taken a significant turn in the last 12 months. While companies in every industry still prefer to invest in permanent employees rather than contractors (75% to 25%) the permanent sales professionals are demanding a much more flexible working environment to remain engaged.
Half of the sales workforce now has flexible working arrangements, with technology provided to allow home access. A significant portion are reaping the benefits of corporate wellness programmes and social responsibility activities, allowing them to spend time giving back to the community without losing commission or base pay.
The consumer products and retail industries are leading the way in diversity, it being medium to high priority in every company surveyed, with the majority having formal inclusion policies and programmes in place.
The current market is resilient, with hiring activity steady across all locations. Limited career progression opportunities are the biggest driver for sales professionals to move on, with individuals often seeking a new challenge or wanting to escape from changed team dynamics.
Predictably, retention follows the opposite pattern, with scope for career progression cited by three quarters of respondents as a reason for remaining with their current company. Salary, work-life balance and learning and development opportunities are all closely aligned, but a definite second to the opportunity to climb the career ladder.
Employers will be hiring most aggressively at the middle management level in the next 12 months, but entry level sales professionals are also required and specialists in high demand. Executive management movements are expected to remain stable and minimal. Business development managers with hunter mentalities when searching new revenue streams are in demand across all channels, signalling a move away from traditional account management. Particularly in demand are candidates able to think laterally and target the market accordingly.
Almost two thirds of sales professionals expect a raise this year, with only 25% expecting not to receive a bonus. This was expected to be dependent on domestic economic conditions and company performance, with only 6% foreseeing that global economic conditions would have any impact. In the wake of the Brexit vote this could change significantly in a short period of time.
FMCG companies make the most consistent bonus payments, with employees expecting between 10-15% of their base salary if they hit all of their KPIs.
Business and professional services and industrial and technical industries can often get higher commissions rather than set company bonuses. While more risky, as long as they make sales and the company performance is on track, their OTE and bonus payments can be much higher.
The overall technology market continues to be very competitive with businesses looking at their service offering and structure to deliver future growth. This includes a focus on delivering better service to customers and more innovative products at the most competitive price point. This market dynamic is driving a strong demand for commercially and results orientated candidates that can deliver these strategies to internal and external stakeholders.
The best calibre candidates are in high demand and are in a strong position to be able to choose their next employer. With this in mind and the fact that brands’ social media platforms and websites can deliver information around the employee experience, more organisations are looking at ways to enhance their employee value proposition (EVP).
There is a strong demand for softer skills that will continue way into the future. Businesses are looking for candidates to have more than just strong technology skills. CIOs and their teams are no longer an isolated function but one that needs to be fully integrated into the operations of a business. With this in mind candidates are required to have excellent interpersonal skills, the ability to think laterally and solve problems and to be able to perform in an environment where team work is a major focus.
There will continue to be strong demand for business analysts as companies will increasingly require the need for strong links between the technology operation and the business heads. The focus here is on making sure that technology projects are relevant, measurable and deliver strategic goals.
Cloud architects have been in demand for the last 12 months and this trend will continue, driven by businesses shifting infrastructure in this direction. Due to the focus on security the quality of people in these roles are viewed as being essential to the smooth running of any technology operation.
Technology continues to carve out an increasingly important role in the way in which a business is run. Growth and agility are the goals for any organisation and as such there is a focus on ensuring the right technology talent is available to enable success. This means that the demand for the best candidates, while already high, will only increase in the next 12 months. The focus will be on recruiting and retaining the best talent in the market.