Despite low unemployment, competition for top roles remains intense
Australian employers are grappling with an unexpected hiring challenge: more job applications are not translating into better candidates, according to new research released by specialised recruiter Robert Half.
The study found 93% of Australian employers face difficulty identifying standout candidates in the current job market, despite a 17.7% year-over-year increase in job applications reported by employment website SEEK.
The research, conducted among 500 finance, accounting, IT, technology, and human resources hiring managers in October 2025, reveals a paradox in the employment landscape. While Australia’s unemployment rate sits at 4.1% and applications flood in, competition for top roles remains intense.
A significant trend emerged in the data: 82% of employers reported an increase in overqualified applicants over the past year. Technology hiring managers saw the highest proportion at 87%, compared with 82% in finance and accounting, and 73% in human resources.
“There’s been a noticeable increase in candidates applying for roles below their experience level, particularly in technology and finance. But overqualification is not necessarily a win. An overqualified candidate may bring experience, but if the role underutilises their skills, both engagement and retention can suffer,” said Nicole Gorton, director at Robert Half.
Obstacles in the recruiting process
The survey identified three primary obstacles preventing employers from identifying top applicants: high application volumes making thorough review difficult (37%), AI-generated CVs complicating candidate quality assessment (37%), and candidates lacking tailored or role-specific skills (35%).
Other challenges included limited visibility into soft skills or cultural fit (31%), generic CVs and cover letters (29%), and overqualification or mismatched experience levels (28%).
Employers identified specific qualities that help candidates stand out in the crowded field. Thirty-three percent cited demonstrated relevant experience tailored to the role, clear and concise communication in application materials, and evidence of adaptability or problem-solving skills as the top differentiators.
“Hiring managers are navigating higher volumes of applications and many are struggling to distinguish the best person for their open role. Uniform formatting, templated language, and AI-generated content often blur the differences between applicants, making it more challenging to evaluate genuine skills and suitability,” Gorton said.
The research suggests that despite apparent market softening, candidates who can effectively demonstrate role-specific experience, problem-solving capabilities, and cultural alignment have the advantage.
“Amid the noise of high application volumes and AI-generated content, employers are focused on indicators of role-specific experience, problem-solving capabilities, and cultural alignment. Candidates who can effectively demonstrate these attributes stand out in an otherwise crowded and undifferentiated talent pool,” Gorton concluded.
Turning to AI to find “hidden gem”
A LinkedIn study released in January also found that about two-thirds of recruiters say it has become harder to find qualified talent over the past year, even as application volumes have climbed sharply in many markets. Recruiters cited growing pressure to fill roles quickly and to identify “hidden gem” candidates amid intensifying competition, with many turning to technology to help bridge the gap.
The data also shows that recruiters are increasing their use of AI tools to uncover candidates with skills they might otherwise miss. According to the research, around 59% of recruiters say AI is already helping them find talent with relevant skills, and a majority plan to expand the use of such tools in hiring and screening processes throughout 2026.
