Why permanent positions will be more important than ever
Rebuilding their full-time workforces should be a priority for Australian companies that want to get ahead as the economy re-opens, writes Dean Davidson, ANZ Executive General Manager at career consultancy and recruitment firm Hudson.
Wondering whether the Covid-19 crisis will put paid to the permanent position for good and all? It’s a fair question and one that’s understandably occupying the minds of many Australians who’ve found their services surplus to requirements, in the overnight recession the virus has ushered in.
Since the pandemic was declared in March 2020, we’ve seen the swift and unprecedented shedding of jobs, by businesses of all sizes and stripes – up to 835,000 of them between March and May, according to estimates by the Australian Bureau of Statistics.
Seemingly every week since then has brought news of another wave of redundancies, as businesses shore up their balance sheets by slashing the payroll.
In June it was the turn of the professional services sector with Big Four firms Deloitte, KPMG and PwC all reducing their headcounts in response to a sharp downturn in demand. Meanwhile, in the higher education sector, there are an estimated 21,000 full-time jobs at imminent risk, as a result of the decline in international student numbers.
From full-time to casual?
Will these permanent roles return as the economy regathers steam? Or are they destined to morph into casual and contract gigs, as organisations hedge their bets by adopting more contingent hiring models?
Some will undoubtedly do the latter. The past two decades have seen steady casualisation of the Australian labour market – one in four of us were employed casually in 2019 – and the Covid-19 crisis is likely to accelerate that trend.
But while taking on temporary workers may be the best way to satisfy immediate skill requirements, it’s not an ideal strategy for rebuilding an organisation’s technical and cultural capacity. And that’s just what thousands of organisations will need to do, in some guise, as economic activity intensifies and Australia, along with the rest of the world, re-opens for business.
As a result, I believe we’re likely to see hiring occur in three categories, as we did in the wake of the country’s last broadly comparable employment downturn, the global financial crisis of 2009. Companies will take on casual labour to plug gaps, contractors for project work and full timers for roles which are viewed as critical to the long-term direction, growth and prosperity of the organisation.
One area that’s likely to see surging demand for permanent personnel is the digital sphere, as local organisations accelerate their investment in transformation initiatives, after being caught on the hop by the Covid-19 crisis. Hudson’s recent Pulse Survey revealed that 78 per cent of respondents planned to hire permanent technical and digital talent over the next 12 months, with tech chiefs on the hunt for employees with ecommerce, customer apps and remote working expertise.
Getting on the front foot
Just when permanent hiring will begin again in earnest is the sixty-four-dollar question. Currently, businesses are still battening down the hatches and understandably so, given the ongoing uncertainty around the duration and severity of Victoria’s second wave lockdown and the likelihood of its being replicated elsewhere in the country, should cases spike.
Individuals who’ve kept their jobs are, in many instances, stepping up and doing ‘whatever it takes’ to help their employers navigate the eye of the storm – and ensure they have work at the other end. It’s a good survival strategy – and one which can allow businesses to hit short term financial targets – but it’s not sustainable in the longer term. Moreover, an over-stretched (and over-stressed!) team won’t have the capacity to take advantage of emerging opportunities, as the economy recovers.
When green shoots start to emerge, businesses will need to shift their focus to investing in essential human capital; hiring the key talents they need to capitalise on those opportunities and operate effectively in the new normal.
Digital transformation programs may be among the first to get the green light, as businesses eschew time consuming business case reviews in favour of fast track approval for ‘quick win’ investments in artificial intelligence, machine learning and digital innovation.
Timing will be key, as it always is in business. While getting ahead of the curve costs money, so does leaving it too late and having to play catch-up, while competitors move forward with confidence.
Now may not be the time to act but it’s the time to start planning. The composition of your workforce – and your success in bringing the right skillsets on board for the long haul – will play a key role in determining whether your enterprise sinks or swims in the challenging period ahead.
