Employers Cautious to Commit to New Headcount
Employers Cautious to Commit to New Headcount
Despite Strong Economic Outlook
Hudson Report survey shows solid economic
expansion not yet translating into increased hiring
expectations
New
Zealand – 26 March 2014 – Hiring expectations
have dipped slightly for the second consecutive quarter,
down 3.5 percentage points (pp), according to the latest
Hudson Report: Employment Trends released today[1].
The drop indicates a slower-than-expected start to the year in terms of hiring given strengthening business confidence and robust economic growth.
Nearly two-thirds (64.6%) of the more than 1,000 employers surveyed said they intend to keep staffing levels steady this quarter. This is a 4.3pp increase, while positive hiring intentions remain relatively stable at 27.3% and, Hudson says, reflects caution in the market.
“The 2014 year started gangbusters with economic indicators almost universally promising renewed and strengthening growth. But while the market is undoubtedly feeling confident, it hasn’t translated into the aggressive hiring activity that was predicted,” said Roman Rogers, Executive General Manager, Hudson New Zealand.
“Employers are also facing the dual pressures of needing to reward and energise existing staff seeking higher pay, with the ongoing mandate to limit cost increases.”
“Where rewarding all staff
is not immediately possible, we recommend being very clear
on what the next steps are for employees and what they can
do in order to reach their salary goals. Organisations might
also consider putting in place intermediary periods whereby
KPI-driven performance-based salary increases may be
introduced on July 1 or October 1, as these performance
targets are met.”
Hiring intentions in the South
Island, while remaining the strongest across the regions,
have dropped a significant 10.3pp with 38.7% of employers
intending to increase headcount, in the lowest result since
Q2 2011.
“This drop in hiring intentions is, in part, linked to the lack of speed around the execution of the Canterbury re-build, as well as the continued adjustment of the market’s expectations around actual hiring requirements,” Rogers said.
Construction and commercial roles remain in demand in Canterbury, including project managers, quantity surveyors and estimators, and there is also increased demand from manufacturing companies who are supplying products to the re-build.
Construction and investment in professional
services[2] are driving the economy in
Auckland and the wider region. Building
consents for 2013 are at their highest levels since 2008[3] and intentions to keep headcount
steady are up 6.9pp to 69.1% in Upper North
Island.
Intentions to increase headcount in
Wellington increased a marginal 0.4pp. With
the Government Financial Year ending on June 30 and the
General Election in September, little growth in hiring is
expected in the coming two
quarters.
Nationwide, the Construction / Property / Engineering sector remains the industry with the highest positive hiring intentions (50.0%), followed by Information Technology (43.4%), Manufacturing (32.9%), Government (26.2%) and Financial Services / Insurance (21.6%).
Hiring intentions in Financial Services / Insurance is back on the rise, up 3.1pp.
“This reflects
increasing profitability in the banking sector and a higher
level of confidence in the industry’s future” said
Rogers.[4]
Teams have been realigned to meet
new strategic plans and specialisations, and sought after
roles include product managers, credit, operational risk &
compliance, insights & analytics, change managers, business
analysts and project managers.
Contractor hiring expectations are up across the board with intention to hire Office Support contractors up a significant 10.5pp this quarter, followed by contractors in Financial Services and Sales, Marketing & Communications, up by 7.3pp and 3.1pp respectively.
“Contracting is on the rise, with companies seeking to grow by using contractors more extensively than before. And, people are more open to taking on contracting roles than they had been previously,” Rogers said.
“While employees in this market have
usually been risk-averse, their worries have been alleviated
by evidence of the more positive economy. They view
contracting as more lucrative than permanent work, see an
opportunity to gain flexibility around work / life balance
and are keen to experience more interesting project work
that they might otherwise get.”
- ENDS
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