The new financial year is here, and it’s expected to bring challenges of its own. But it also comes with a renewed focus on growth and innovation for businesses in Australia. But this can’t happen without the right talent on board. That’s why recruitment is top-of-mind for many leaders.
So this begs the questions: What are the biggest hurdles companies are facing, and where are they putting their money to overcome them?
Let’s dive right in.
5 Recruitment Challenges in 2024
1. Talent Shortage and Skills Mismatch
Globally, 70% of tech leaders reported an all-time high demand for tech skills such as “cybersecurity expertise”, “big data analytics”, and “software architecture.” Yet employers struggle to find candidates with the right skills. 74% feel that their government could do more to tackle the digital skills. 6 out of 10 CIOs believe they’ll never have sufficient tech talent as the modern market landscape demands faster operating speeds, continuous innovation, and cost efficiency.
The Employ Recruiter Nation Report shows 57% of talent pros expect hiring to be tough this year. Why? Not enough quality candidates, competition from other employers, fewer recruiters, and more employees leaving.
This shortage hits SMBs harder, but even large enterprises see more open roles on the horizon.
2. Long Hiring Processes
Long hiring processes can scare off potential candidates. They’ll take offers from companies that move faster. In fact, 70% of professionals in Australia are abandoning job applications due to complicated and confusing recruitment processes.
Streamlining is essential. Plus, many organisations still grapple with unconscious biases and inclusive hiring. Diverse teams perform better, so this is a crucial area for improvement.
3. AI-Generated CVs
More candidates are turning to tools like ChatGPT, Claude.ai, and Gemini to craft their CVs. While this can lead to polished, professional documents, it also presents a few challenges.
AI-crafted CVs often mask genuine skills, experiences, and personalities, making it difficult for candidates to truly shine. Conversely, recruiters struggle to see the real person behind the AI-generated content. This lack of authenticity can result in missed opportunities for both parties.
4. Cost of Living Crisis
Despite a 4% rise in wages last year, it lagged behind a 5.3% increase in consumer prices.
To cope, more workers are taking on second jobs, reaching a record high of 6.6% last year. The recent job boom has eased some pressure by offering higher-paying roles and additional employment opportunities.
Inflation-adjusted wages are on the rise and are expected to continue increasing this year. However, the significant impact of the crisis means a full recovery could take 5-10 years.
Organisations with stagnant wage growth may face higher turnover as employees seek better incentives from competitors.
5. Uncompetitive Pay and Benefits
Around 43% of businesses lose talent due to uncompetitive pay and benefits. In a very tight labour market, people aren’t necessarily going to hang around if they’re not happy with their pay.
A survey of 1000 Australian workers found 58% would not take a job if the salary didn’t suit. 40% say they prioritise higher salaries when job hunting.
Strategic Investments: Where Talent Teams Plan to Invest
Investment in recruiting is set to rise or remain stable. Most talent acquisition pros expect to increase (61%) or maintain (29%) their recruiting spend. Medium-sized companies are more likely to boost budgets compared to enterprises and small businesses.
Here’s how companies plan to spend:
1. Partner with external firms
Partnering with external firms can significantly boost your talent team’s capacity. These partnerships allow internal teams to manage their workload effectively without compromising on quality.
For instance, at ThunderLabs, a nonprofit organisation worked with us, taking on the responsibility of interviewing and vetting over 100 candidates. This support was crucial for their internal recruitment team, which lacked the resources to handle such a high volume of candidates.
By leveraging external expertise, companies can streamline their recruitment processes and ensure they don’t miss out on top talent while still empowering their internal teams to focus on strategic priorities.
2. Employee Engagement and Retention
Keeping employees happy is critical. This means better manager training, acting on feedback, and creating internal mobility. 81% of Australian employers are focusing their benefits programs on employee attraction, retention and engagement.
According to The Workplace Engagement Index Report, crucial themes for sustained engagement include:
- Fair pay and financial benefits
- Transparent communication
- Work-life balance
- Flexible work arrangements
- Engaging work scopes
- A culture of empathy
- An inclusive environment
3. Diversity, Equity, and Inclusion (DEI)
Diversity, Equity, and Inclusion (DEI) remains a top priority. Indeed’s DEIB Survey 2023 shows that 8 out of 10 job seekers value organisations that promote diversity and inclusion.
Workday’s “Global Blueprint for Belonging and Diversity” study reveals that 43% of Australian companies are committed to attracting and recruiting a diverse workforce. Additionally, 83% of organisations now allocate a dedicated budget to DEI, up from 69% in 2022.
Addressing the “broken rung” in promotions, especially for women and minorities, is essential too. Many companies highlight their DEI commitments on career sites, write inclusive job descriptions, and use diverse interview panels.
4. Recruitment Process Outsourcing (RPO)
RPO is gaining traction. It means outsourcing some or all recruitment processes to external partners. This approach scales resources and fills roles quickly. According to Employ data, 55% of HR decision-makers are considering RPO in 2024. For project recruitment, RPO can be a game-changer.
Build Your A-Team Faster with ThunderLabs
With ThunderLabs as your partner, you can hire A-players in weeks while slashing fees by 70%.
At ThunderLabs, we understand the complexities of recruitment in today’s market. We help you find and hire the right people for your team. Leverage our large database of qualified candidates and our tailored recruitment solutions to get the talent you need, when you need it.
We offer a range of solutions, including:
1. CO-SOURCE: ASSEMBLE YOUR TEAM
Need to fill multiple roles quickly? Our Co-Source approach offers the perfect balance of volume and value, ensuring you get the best without compromising on quality.
2. HIRE A TOP TALENT
Got a one-off permanent role to fill? Our Retained model has you covered. Satisfaction guaranteed: if you’re not impressed in the first week, you get your money back. It’s peace of mind for key hires.
3. CONTRACT: WORK WITH EXPERTS
Need experts on demand? Our Contract option delivers the best in the market, not just the best on the bench. With competitive margins, you get high-calibre talent precisely when you need it, boosting project success.
Recruitment made easy. Think ThunderLabs.
