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Hiring Expectations Dip Slightly Despite Positive Conditions

Hiring Expectations Dip Slightly Despite Positive Economic Conditions

Hudson Report survey shows employers remain cautious

New Zealand – 15 January 2014 – Hiring expectations dipped slightly this quarter, down 2.9 percentage points (pp) from the previous quarter’s five-year high, according to the latest Hudson Report: Employment Trends released today[1].

The drop comes despite New Zealand’s economic indicators showing organisations are well positioned for 2014 as a result of strengthening business confidence and solid economic expansion.

Nearly two thirds (60.3%) of the more than 1,000 employers surveyed said they intend to keep staffing levels steady this quarter. This rose 3.3pp and accounts for the slight drop in positive hiring intentions, which remain relatively stable at 30.8% and Hudson says, reflects continued caution in the market.

“Although indicators suggest another year of continued economic growth, employers are cautious and remain hesitant to commit to new headcount, particularly with an eye to the performance of the Australian economy,” said Roman Rogers, Executive General Manager, Hudson New Zealand.

“The employment market remains tight, so employers’ ability to find the people and skill sets they need, and take advantage of the more confident economic conditions will be critical to getting ahead in the next 12 months.”

“In saying that, with the labour market still subject to fluctuations in demand, the challenge for employers in 2014 will be to navigate the step-change from a pure focus on productivity to pursuing new growth opportunities and making the decision to take on new staff.”

Hiring intentions in the South Island remain the strongest across the regions, with 49.0% of employers intending to increase headcount. This is largely being driven by demand for labour in all forms in Canterbury. Strong manufacturing activity[2] in Auckland is driving positive hiring intentions up 1.4pp to 28.2% in Upper North Island.

Intention to increase headcount in the Lower North Island dropped 8.7pp to 24.8%. This is reflective of the level of financial restraint the current government is exercising over public expenditure in relation to its self-imposed cap on public sector headcount.

Nationwide, the Construction/Property/Engineering sector remains the industry with the highest positive hiring intentions (58.0%), followed by Information Technology (47.9%), Manufacturing (43.6%), Government (29.6%), Healthcare (excl. government) (25.0%) and Financial Services/Insurance (18.5%).

The strength in Construction/Property/Engineering is underpinned by the Canterbury re-build and to a lesser extent demand for housing in Auckland.  Candidates in demand include project managers, estimators, quantity surveyors, contracts managers and individuals with civil engineering skills across a broad range of disciplines.

“Throughout the IT sector, many organisations are approaching the time where investment in upgrades or new platforms is a requirement rather than an option, and there is a growing focus on digital,” said Mr Rogers.

“The ability to manage the IT infrastructure procurement process effectively and invest wisely will be crucial to getting ahead in 2014 and beyond. And we’re seeing acceleration in investment in digital-related roles.”

IT candidates in demand include project managers, business analysts, developers and testers. Demand for ICT contractors is the strongest across all professions, with 31.3% of ICT employers looking to increase contracting headcount.

Overall demand for contractors eased due to seasonal factors, dropping 5.0pp to 19.8% intention to hire, as organisations sought to maintain leaner operations during the holiday period and as projects requiring additional resource come to a close. This trend is likely to continue as the year goes on and organisations’ appetite to add permanent headcount grows stronger.

“Favourable economic conditions have employers well positioned to pursue expansion plans in the year 2014. The organisations with the right skills and people in place will be well placed to capitalise on the growth opportunities in the current environment.”

[1] Hudson surveyed 1,091 New Zealand employers about their hiring intentions January to March 2014

[1] Business NZ PMI – November 2013

ENDS

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