- Published
‘A forward view of the Australian labour market’
The Australian HR Institute (AHRI) recently released their June Quarter 2024 Work Outlook Report revealing that Australia’s skills gap is harming productivity, with high turnover predicted to be a key cause.
Disclosure: Information is reflective of the Australian HR Institute (AHRI), Quarterly Australian Work Outlook June Quarter 2024 statistics.
Source: AHRI Q2 2024 Work Outlook Report
Key Insights from AHRI Work Outlook Report
In the face of Australia’s nationwide skills shortage, recent research from the Australian HR Institute (AHRI) paints a clear picture of the challenge at the organisational level.
Skills Gap
According to AHRI’s June 2024 Quarterly Australian Work Outlook report, close to 1 in 5 of workers lack proficiency in their roles, with a notable majority (57%) of employers acknowledge the detrimental impact of skill gaps on their organisation’s productivity.
Training Investments
Despite this the report on proficiency levels, organisations have emphasised that 37% are intending to boost their investment in training within their business over the coming year, with merely 6% planning to reduce training allocations.
Recruitment
Employers addressing recruitment challenges are focussing on three key activities: enhancing the skills of current employees (30%), increasing wages (23%), and enhancing benefits (22%). Of those currently hiring, 40% encounter recruitment hurdles, a figure similar to the previous quarter’s 38%.
Employment Intentions
Employers indicated that the average anticipated basic pay rise in their organisation (excluding bonuses) is projected to be 3% for the 12 months leading up to April 2025, a decline from 3.7% for the 12 months preceding January 2025.
Employee turnover remains a concern, with the 12-month average turnover rate reaching 15% by March 2024, up one percentage point from the previous report. The public sector saw a significantly higher turnover rate at 23%, compared to 13% in the private sector. Looking ahead, 23% of employers anticipate worker redundancies in the upcoming June 2024 quarter, consistent with the previous quarter. However, there’s some optimism as 41% of organisations plan to increase staff levels, while only 5% intend to reduce their workforce during the same period.
The anticipated growth in employment presents a complex picture for both employers and policymakers. While there is optimism regarding job creation, questions linger about whether this growth is primarily driven by addressing existing job vacancies or signifies sustained job market expansion. Despite a recent decline in vacancies since mid-last year, they remain notably high, with nearly half of employers facing challenges in filling positions.
AHRI CEO, Sarah McCann-Bartlett believes the Australian jobs market remains tight but doesn’t seem to be driving real wage inflation. Thus, while the employment landscape shows signs of resilience, careful monitoring and strategic interventions may be necessary to navigate potential economic implications.
Exploring these nationwide statistics provide organisations with a valuable outlook on the current and future employment landscape, offering essential insights to assist in strategic planning, and decision making. Understanding and being aware of these dynamics are crucial so organisations can proactively address them.
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