Learn about 'silver lining' in HR’s 'recruitment difficulty' with new research
The latest Internet Vacancy Index (IVI) showed that job advertisements declined in July, the first recorded monthly fall in 2022, a report from the National Skills Commission (NSC) recently revealed.
NSC said that job advertisements consecutively increased from January 2022 to June 2022. Yet, come July 2022, job advertisements dropped by 3.8% (11,200), standing at 288,500. HRD probes if this could signal an upcoming trend in “recruitment difficulty” and what possible implications it may have for employers.
A decline in HR’s recruitment activity for Australian employers
All states and territories experienced a decline in recruitment activity in July 2022, according to NSC’s media release.
“The sharpest decline was recorded in the Northern Territory, where recruitment activity fell by 8.2% (or 260 job ads), followed by Victoria (down by 7.8% or 6,200 job ads) and the Australian Capital Territory (down by 6.0% or 490 job ads),” the NSC said.
The commission further said South Australia had the smallest decline in job advertisements, down by 0.8% or 120 job ads.
Notwithstanding the drop in July 2022, NSC said there was substantial growth in recruitment activity in the last twelve months, with job advertisements at 24.5% higher than in July 2021.
“In comparison to levels of recruitment activity observed prior to the COVID-19 pandemic, online job advertisements are up by 71.4% (120,200 job ads),” NSC said.
“This growth is reflected across all jurisdictions, with increases ranging from 31.2% (1,800 job ads) in the ACT to 139.8% (2,500 job ads) in Tasmania,” it added.
What do the numbers mean for employers?
According to NSC, one of the most misunderstood terms when it comes to recruitment surveys is the phrase “recruitment difficulty.”
The commission clarified that the recruitment difficulty rate is “the proportion of recruiting employers who experienced difficulty hiring.”
It further said that the recruitment difficulty rate doesn’t correlate to all employers and only related to those presently recruiting or who had recruited in the prior month. “’Difficulty hiring’ is a subjective measure for the employer to assess,” NSC said.
Additionally, the commission said that recruitment difficulty does not necessarily mean that positions become unfilled.
“That said, some employers who fill jobs within a few weeks do indicate that they found it difficult to recruit staff with the right skills,” NSC said.
“This may mean employers have had to compromise or be more flexible in who they hire – such as hiring less experienced applicants and training on the job, or changing the nature of a role to suit those applicants that are available,” it added.
Despite the seriousness of the recruitment difficulty, the commission said there is a “silver lining to this cloud.”
“That silver lining is that recruitment difficulty is not just a function of mismatches (e.g. employers seeking skills in short supply or employers and potential employees being located in different parts of the country), but that recruitment difficulty is often highly correlated to the general strength of the labour market,” NSC said.
It further explained that when more employers search for staff, finding the right employee naturally becomes more challenging before another employer snaps them up.
Thus, the NSC said that “with the unemployment rate at a low level and job vacancies much higher than prior to the pandemic, at least part of the recruitment difficulty being cited by employers will reflect the strength in the jobs market.”
