JobAdder has released its Q3-Q4 2022 Global Industry Report on Recruitment and Staffing. The report highlights the decrease in new job openings in Australia and New Zealand, suggesting a potential economic slowdown.
According to the latest data, the average number of jobs created by recruitment agency users in Australia in the fourth quarter of 2022 decreased from 66.3 in Q3 to 58.9. In New Zealand, the number of jobs created dropped from 59.9 to 53.
Despite this decline, the number of job applications per role in Australia increased from 15.3 in Q3 to 16.9 in Q4, while in New Zealand, the number of applications per job rose from 12.5 to 13.4. The previous trend of recruiters struggling to fill numerous job roles has now given way, providing recruiters in both Australia and New Zealand with an opportunity to take some time to re-evaluate and strategize for the future.
As per the CEO of JobAdder, Martin Herbst, “The imbalance between job demand and candidate undersupply, which was a persistent issue for recruiters due to high job growth and employee empowerment in the employment market, is set to change this year due to factors like slower growth, immigration restrictions, and sector-wide layoffs.”
Herbst added, “This shift will give recruiters more time to focus on strategic planning instead of frantically trying to fill open positions. This extra time can be utilised to train and upskill staff, enhance technology, and prioritise finding diverse candidates.
“Recruiters should seize this opportunity to shift their focus from survival mode to strategy mode, where they can explore new and unconventional candidate sources and eliminate unconscious bias through technology.”
Recruitment thought leader and JobAdder advisor, Greg Savage, said: “The impact on recruiters of more applications per job is very nuanced. Job volumes are dropping, but they are still healthy, and hiring continues. We are not in a recession (yet). The fact that candidate flow is increasing may also be a mixed blessing. The volume of candidates does not always mean more qualified candidates. Indeed, an impending downturn reduces candidate confidence and inclines many well-qualified people to stay put.”
In Q4 2022, agency users in Australia took 5.8 days to place candidates in temp and contract roles, but New Zealand knocked Australia off its long-held top spot by taking an average of 5.6 days. However, when filling permanent placements in Q4, Australia reclaimed its number one position, averaging 31.7 days compared to New Zealand’s 35.1 days.
It took significantly fewer days for temp and contract roles and permanent positions to be placed across Australia and New Zealand with JobAdder’s existing talent pool than for agencies to place these roles through an external source such as a job board.
In Australia, temp and contract roles were filled in an average of 4.8 days in Q4 when using the JobAdder database, compared to 25.3 days when using external sources. Similarly, New Zealand saw a marked difference in days to place temp and contract roles in Q4, averaging 18.2 days with an external source compared to just five days with the JobAdder database.
Recruitment agencies in the Australian market have seen consistent, steady growth in average agency fees, rising 0.6 per cent in Q3 and 0.7 per cent in Q4. Meanwhile, agencies in New Zealand experienced more fluctuations, dipping 0.5 per cent in Q3 before increasing by 1.8 per cent in Q4.
Mr. Savage added: “As hiring demand drops, agencies should not return to the lack of candidate service ethos that has characterised our industry for so long. Even as they increase business development with clients, agencies need to ensure they don’t take the focus off activating their candidate pipeline because it’s how they treat those candidates when they don’t need them that will dictate how many they have when the hiring market improves.
“Agencies need to be visible to their existing clients, nourish relationships with them and flex their business development muscle. Now is also the time to reignite dormant client relationships. Get in touch. Go and see them. Engage whenever possible. In their communications with clients, agencies should also focus on value.
“Explain that it’s harder to recruit great candidates in a depressed job market, not easier. The volume of applications increases, and the best candidates are reluctant to move. As a result, a recruiter works harder for the outcome, screening much more effectively to find the right candidates in what might become a crowded but not highly qualified candidate marketplace,” he said.
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