The economic fallout from the COVID-19 crisis has seen Australia enter a recession – facing one of the largest labour market shock since the Great Depression.
With restrictions coming back again in certain areas of the state, businesses are contemplating about what recovery could actually mean for them right now. Nearly a quarter of a million people lost their jobs since May, sending the unemployment rate to 7.1%, the highest since October 2001.
Nonetheless, Prime Minister Scott Morrison shared “These are our dark times, but I can see that ray of light, and I’m sure Australians can see that,” he told reporters in Canberra.
As such, what would the current labour market landscape and macroeconomic effects brought about by COVID-19 look like? And what are some indicators of possible pathways to recovery?
Here are some top learnings from SEEK – Australian employment marketplace – virtual webinar on the Employment Market in Australia.
A quick glimpse of Australia’s current labour market
Some key highlights on the market we are facing today:
- We are experiencing the first recession in almost 30 years
- We are experiencing the highest unemployment rate since Oct 2001 at 7.1%
- 3 million have left the workforce or reduced their hours over March and April
- We are at the lowest labour participation rate of 62.9% since 2001 Jan
Given the above circumstances, SEEK, shared that candidate activity is also currently low. This suggests that not many people are open to change jobs or look for new opportunities given the growing competitiveness on job security, and fear of being made redundant.
While pessimism exists in the market given the bleak outlook, the national government intends on building what it has called "a bridge to recovery on the other side" of the health crisis through an unprecedented wage subsidy scheme. This would also support jobs for 6 million people at a cost of AUD 130 billion over the next six months. Recovery can also be seen across some sectors and states, but at varying levels.
Consumer services includes a range across hospitality, tourism and retail. All around the world, it is known that this sector was hit the hardest during the pandemic as remote working and digital adoption have generally been weak as only the larger companies had the financial capacity to go digital.
Nonetheless, SEEK posits that consumer products have bounced back from a low, and consumer confidence are making a return. However, this sector is highly dependent on the policies and restrictions that are still in place within the state, and thus uncertainty will continue. In order to prepare businesses in this industry, organisations need to be ready for the new normal as automation and technologies integrate more across businesses. Automation will transform the ‘retail experience’ of consumers with self-check kiosks, mobile app to pay in-store or getting rid of checkout altogether with online stores. Automation and tech adoption will also lead to the creation of jobs as companies invest in growth.
Construction and industrial services
This industry covers trade and services, as well as architecture, which have been under restrictions since the lockdown. Although there are some who have returned to work, the situation continues to be unclear with COVID-19 cases rising again. However, as shared by SEEK, industrial sectors like manufacturing, transport, mining, and farming are almost back at pre-COVID levels in terms of job vacancies and opportunities.
Information Communication Technologies (ICT)
Job opportunities have fallen considerably and recovery have been sluggish for ICT in the nation. It is notable that ICT in Australia is heavily reliant on contingent labour and although there are opportunities available, demand for such roles fell due to lack of optimism for job security.
Job security has led to a greater appetite to take on key permanent roles as growing uncertainties and anxiety within ICT continue.
Nonetheless, there have been recovery on IT projects seen by greater capital expenditure of businesses. They are now seeing this move as an investment to future success, and depending on level of confidence, they might start to rehire and go back to recruitment soon albeit a gradual growth.
Optimism in the contractual market
SEEK shared that part-time and contract work will still be on the rise. Following the coronavirus-triggered job cuts spree, businesses are more cautious about hiring full-time staff.
With stable full-time work and permanent roles on an all-time low, one will have to consider part-time and contract options to maintain an income that supports their lifestyle.
Research has also shown that workers are going out of their comfort zone. Employees in Australia are 1.4 times more likely to apply for jobs in different industries, especially those in badly-hit sectors such as recreation and travel. Meanwhile, workers in essential services and sectors that have grown during the pandemic – like network infrastructure, healthcare, and delivery services – are more likely to apply for jobs in their own industry.
Why you should not fear if you are on a contractual employment?
Although there may be a lull in activity, contractors can still use this time to network and build connections within their workplace. LinkedIn is a great place to start. Think of this as a chance to do some business planning, getting your CV and LinkedIn profile up to date and your portfolio in order.
You could also use it as a chance to upskill, by using sites such as Skill share that have made online learning easier than ever and allowing you to brush up on relevant skills to add to your CV. You can adapt to the online way of working, as many other businesses have done, by maybe offering virtual coaching or consulting in your areas of expertise via Zoom or a similar online platform. Think about what you can offer post-pandemic, and how you can go about honing your own personal brand or offering so that you can adapt to the new climate and possibly offer a more niche service in the long run.
Hiring or looking for a new role?
Interested in discussing career options in the current economic situation today? To hear about the latest opportunities on the market please don’t hesitate to contact us at our Sydney or Melbourne office. Do also follow our Linkedin page for continual updates on the job market.