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One in three bosses planning redundancies

About 30% of employers intend to make some roles redundant within the next three months, according to a new report – almost double what was predicted three months ago.

13 Dec 2023

Mike Toten

Mike Toten is a freelance writer, editor and media commentator.

According to the Australian Human Resources Institute's (AHRI) latest Quarterly Work Outlook Report (for December 2023 quarter), about 70% of employers intend to recruit new employees during the next quarter, compared to 60% three months ago.

The report also claims that employee absenteeism is increasing, with employees now averaging six unscheduled days of absences per year. The main reasons appear to be the continued existence of COVID-19 plus managing at-home responsibilities and minor illnesses.

The report provides further information on how organisations measure absenteeism, and how they attempt to address its causes.

Other key findings included:

The main challenges affecting employees are cost-of-living pressures (51%), work/life balance, and high workloads (about 40% each).
About 45% of businesses plan to increase staff during the next quarter, versus only 4% planning a decrease. This indicates that most of those businesses intending to retrench employees also plan to recruit new ones. However, almost half (47%) reported difficulties in hiring staff during the past three months.
Overall employee turnover rate was 14%, higher in the private sector (18%) than elsewhere.
The average predicted pay increase over the next 12 months is 2.6%, versus 2.8% in the previous survey and 3.3% in the one before that.
Almost two-thirds of respondents believe that a law or policy that gives employees the right to disconnect from work-related communications outside of working hours would have a positive impact on employees in terms of being able to perform work flexibly.

What do these statistics mean?

The report offers the following explanations:

The increased “intention to recruit” reflects the ongoing difficulties many employers have faced with filling vacancies, but it is more a reflection of back-filling vacancies than an indicator of overall business growth. If that is correct, then increased recruitment is not incompatible with simultaneous increased redundancies.
High turnover rates and long-standing “proficiency gaps” are also driving the trends.
The slight fall predicted in wage growth (compared to the previous survey) is providing extra challenges for recruiters and HR functions, as they have to attract new employees while being under increased pressure to control overall costs. It indicates that approaches to remuneration and reward packages will need to become more creative.

Read the full report here:

The report findings are based on a quarterly survey of about 600 employers and HR practitioners. About 30% are from businesses with less than 20 employees, about 25% are from those with between 20 and 120 employees, and the remainder are from larger businesses. The quarterly surveys commenced in early 2023.