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How safe is your job? A shift in Australia’s workforce is well underway

·5-min read
Australia's workforce is becoming more casualised. (Photographer: Brendon Thorne/Bloomberg)
Australia's workforce is becoming more casualised. (Photographer: Brendon Thorne/Bloomberg)

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 Global Workforce Agility Report 2021, 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).

Before the latest Delta COVID-19 outbreak, which has now sent three Australian states into lockdown, Australia’s economic recovery saw the unemployment rate fall to a 10-year low, job ads to an all-time high and sparking a massive war for talent across the nation amid closed borders.

KellyOCG Asia Pacific regional director Peter Hamilton said organisations were dealing with the “fierce” war for talent by “taking a more fluid approach”.

“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.”

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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.”

SYDNEY, AUSTRALIA - JULY 13: Commuters are seen in a normally busy Martin Place in Sydney's CBD on July 13, 2021 in Sydney, Australia. Prime Minister Scott Morrison and NSW Premier Gladys Berejiklian have announced a financial assistance package to support NSW households and businesses affected by the current COVID-19 lockdown. The combined federal and state support package will see the COVID-19 disaster payment increased to $600 from week four of lockdown, if a person has lost 20 or more hours of work a week, or $375 if a person has lost between eight and 20 hours of work a week. A new business support payment will also be available to entities with an annual turnover between $75,000 and $50 million who can demonstrate a 30 percent decline in turnover. COVID-19 lockdown restrictions are currently in place across Greater Sydney, the Blue Mountains, the Central Coast and Wollongong as NSW continues to record new community COVID-19 cases. All residents are subject to stay-at-home orders and are only permitted to leave their homes for essential reasons, including purchasing essential goods, accessing or providing care or healthcare, work, education and exercise. (Photo by Jenny Evans/Getty Images)
Roughly a third of workers in Australia's biggest companies are contractors. (Photo by Jenny Evans/Getty Images)

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.

Research and advisory firm Gartner’s latest Global Talent Monitor report shows that 24 per cent of Australian workers are looking to switch jobs as work/life balance and mental health becomes increasingly prized above career growth.

“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 currently hiring, including professional services sectors 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”.

Workers are embracing the pandemic-triggered volatility in the employment market right now, she said in a career advice note from December.

“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

The pandemic has exacerbated a trend of casualisation within Australia’s workforce that was already happening.

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 analysis 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.

Speaking to a Senate Select Committee on Job Security in April this year, Centre for Future Work economist Dan Nahum said the brunt of COVID-19 was felt “most acutely” by casual workers.

“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.

A food delivery rider makes her way in the Melbourne Central Business District on July 16, 2021, after Australia's second largest city entered a fresh lockdown amid a resurgence in coronavirus cases. (Photo by ASANKA BRENDON RATNAYAKE / AFP) (Photo by ASANKA BRENDON RATNAYAKE/AFP via Getty Images)
A food delivery rider in Melbourne CBD on July 16, 2021, after Australia's second largest city entered a fresh lockdown. (Photo by ASANKA BRENDON RATNAYAKE/AFP via Getty Images)

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.

“It’s better to just call them ‘leave-deprived’ employees,” he wrote in a recent piece for The Conversation.

“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’.”

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