Published on the 22/06/2023 | Written by Heather Wright

Intentions are high, but what about supply?…

Australia’s IT sector has recorded the strongest hiring intention worldwide, while in New Zealand, firms are reversing their hiring intentions for IT contractors, but the market for permanent employees is running high.

The findings come from two separate reports. In Australia, the global Manpower Group Employment Outlook Survey shows Australian employers are anticipating a moderate increase in hiring activity in Q3, with IT hiring in particular looking buoyant.

The survey covered nearly 39,000 employers in 41 countries. Manpower no longer provides services in New Zealand, so no Kiwi organisations were included in the survey.

“Despite challenges leaders are still adopting a growth mindset and focusing on long-term success.”

Forty-six percent of the 1,020 Australian employers surveyed, across all industries, reported they were planning to increase headcount during the coming quarter, with just 12 percent expecting a decrease.

After seasonal adjustments, that gives Australia a net employment outlook of +37 percent – a seven percentage point jump on the previous quarter, but one percentage point down on the same time last year.

It’s the tech sector, however, that is looking most robust with a net employment outlook of 61 percent – far outstripping demand in other sectors, and nearly 20 percentage points ahead of second placed financials and real estate on 42 percent.

Across the ditch in New Zealand, Absolute IT’s Job Market Salary Report 2023 says 82 percent of employers are planning to hire permanent IT staff this year, with 81 percent of those planning to increase their headcount by up to five, 12 percent planning to hire between six and 15 new permanent employees, and seven percent planning to recruit 16 or more this year.

That demand, Absolute IT says is being driven by increased demand of IT from the business, new projects, and replacing exiting staff. Increased customer demand and adoption of new technology round out the top five primary reasons for hiring.

It’s a slightly different story on the contract hiring side, however, with just 39 percent planning to bolster their teams with contractors – down from 51 percent last year.

But companies face a potential ongoing exodus of IT staff, too, with 59 percent of Kiwi tech professionals reporting they’re considering moving to a new workplace – and 59 percent of those considering a new role already actively looking.

Penny O’Reilly, Manpower Group Australia managing director, says while Australian businesses are facing daily challenges with supply chains, demand levels, inflation and talent availability, leaders are still adopting a growth mindset and focusing on long-term success.

“The Australian information technology sector continues to go from strength to strength,” O’Reilly says.

“Demand for software developers, data analysts and cyber security professionals continues to boom, especially in the banking, finance and retail space.”

But while there might be intent to hire in the coming months, finding those workers continues to be a challenge, with 84 percent of organisations in the Manpower survey reporting difficulty finding the IT talent they need and O’Reilly noting domestic and international businesses are ‘competing hard’ to recruit the in-demand skills locally.

There is, however, slow and steady growth in the number of people in the Australian IT sector. Last month, Tech Council of Australia (TCA) reported an eight percent increase in tech jobs in the year, taking the country’s tech workforce to 935,000 in February. The TCA says those numbers were bolstered even more with 10,500 jobs added in the three months to March.

The February numbers put Australia at 78 percent of its goal of 1.2 million tech workers by 2030.

That growth came against some dramatic downsizing by tech firms, with companies including Atlassian and Xero each laying off hundreds of staff, while companies including Swyftx and Linktree also slashed staff.

But the TCA says its research shows that for every job lost in the past quarter, 20 have been created.

It says most of the growth is coming from the ‘indirect’ tech sector – technology intensive jobs within non-tech industries such as retail, banking, professional services, government and mining.

Kate Pounder, Tech Council of Australia chief executive, says the growth in non-traditional tech industries shows digital skills are becoming deeply embedded into all facets of the economy.

“Tech is now a major employer in all states and territories, with the tech workforce being Australia’s seventh largest employing industry,” Pounder says.

As to the skills most in demand, in New Zealand it’s business analytics, software development, project management, support/help desk and data/database that lead the charge. Project management has moved into joint second spot, up from eight last year, further highlighting the increase in new projects spurring hiring. Data related skills are also a big mover for the year, up from nine last year.

But it’s artificial intelligence and internet of things that are most getting technology professionals excited, followed by data insight platforms, advanced automation and robotic process automation and blockchain.

Manpower’s report for Australia doesn’t identify specific tech skills most in demand, but does note that the top soft skills IT employers are seeking include critical thinking and analysis, creativity and originality and leadership and social influence.

The local findings come as a global report from Experis – part of ManpowerGroup – finds more than three-quarters of IT organisations are struggling to find talent with half saying they were training and upskilling their current workforce to address tech staffing challenges.

An increasing number companies were also either adopting or planning to adopt emerging technologies including AI, conversational AI, machine learning, and virtual reality (VR) to help in recruiting.

“The integration of AI, machine learning, VR/AR and other emerging technologies is rapidly transforming industries and driving the need for an adaptable workforce,” says Ger Doyle, Experis senior vice president.

“We are seeing companies embrace these new technologies with many seeking to hire or upskill existing talent to take advantage of potential productivity gains. Smart employers know that embracing digitisation and nurturing human talent will enhance their readiness to succeed in this era of rapid technological advancement.”