Australia’s workforce is set to become more insecure than ever as the pandemic encourages large enterprises to hire less permanent staff and more contractors, new research has revealed.
According to the , which surveyed more than 1,000 senior executives across 13 countries by outsourcing and staffing firm KellyOCG, Australian business leaders are more likely than their global counterparts to plug skill gaps by hiring a contractor for the job (52 per cent in Australia compared to 48 per cent globally).
Australian firms are also less likely than global counterparts to hire new permanent staff (36 per cent in Australia compared to 45 per cent globally).
“There’s a high demand, skilled workforce out there delivering on temporary requirements,” he told Yahoo Finance, adding that businesses need to respond quickly to challenges to survive.
“A lot of [the war for talent] has been absorbed through the creation of new temporary jobs.”
About a quarter of all Australian employees are classified as ‘casual’ workers, which includes everything from independent contractors to gig workers and tradies.
Hamilton estimates that roughly a third of office staff working for Australia’s large enterprises today would be “provided externally”.
“You go into most large enterprises in Australia and the executive would probably struggle to tell you how many temporary workers, how many contractors, or how many other service providers are there engaging,” he said.
“They may have a handle on the permanent workforce. But unlikely to have a true view of all the people coming into the organisation to get work done.”
Aussies are seeking out temporary work
Hamilton believes that the shift to a more temporary workforce is also being driven by workers who are itching for new opportunities.
“The reality is, a lot of people want to be engaged – particularly knowledge workers, like the IT contracting population in Australia. There’s the desire to be working for the latest technology,” said Hamilton.
“They’re generally getting a premium above their colleagues.”
It’s a good time to be looking for work right now, Hamilton added. The proof is in the data: SEEK’s latest employment report reveals that industries from all kinds of sectors are like, legal, banking, and advertising.
”For candidates who are motivated to look for work, there's a great opportunity right now.”
HR Partners’ Jeannette Lang says most organisations nowadays are employing a mix of temporary and full-time workers, which makes for “a more responsive, productive workplace and a flexible job market”.
“Many people have moved to the flexible short-term contract and temporary arrangement because they are either between perm roles or by choice to expand their resume by industry and skills,” Lang said.
“The COVID-19 experience has given them pause for thought and they now want to embrace a more flexible work life/balance.”
COVID-19 worsened insecure work
Research has shown that the pandemic hit lower-paid, insecure workers hardest. Casual employees lost their jobs at a rate eight times faster than permanent workers, and part-time job losses were three times worse than full-time workers, Australia Institute Centre for Future Work reveals.
Women and young people, in particular, have been impacted the most, with Australia’s pandemic-triggered downturn earning the nickname the ‘pink recession’.
Not only that, but the jobs recovery that started in May 2020 was driven predominantly by insecure jobs. From May to November last year, 400,000 new casual positions were created – a rate of 2,200 a day.
“Following the initial brunt, later in 2020, we observed the fastest casualisation of the Australian labour market in history, as well as the increased prevalence of other types of precarious employment,” Nuham said.
But casual employment is just one of several forms of insecure work, Director of the Centre for Future Work Jim Stanford added, which might include part-time jobs, temporary jobs, labour hire, independent contractors, and then the digital gig worker.
“So the problem of precarious work is bigger than the problem of casual work, and I think it's wrong to focus on the ratio of casual employment as the only indicator,” he said.
“Insecure work defined more broadly has definitely become in a way the new normal for a great deal of the labour market.”
And according to Griffith University professor of employment relations David Peetz, many so-called ‘casual’ jobs actually work permanent hours anyway.
“The big difference between leave-deprived employees and ‘permanents’ is in the power employees have.
“Sometimes you hear the term ‘permanent casuals’. They should more accurately be called ‘permanently insecure’.”