Boom times for graduates as skills shortages loom

Data is not yet available for the most recent cycle of graduates, but Federal Ministry of Education data shows that in 2020 and three months after graduation, more than 30% of students had no full-time job, compared to 20% ten years ago.

“We’re seeing more and more employers want to hire outside of academia because they’re having a hard time hiring at that more experienced level,” says Dan Purchas, GradConnection’s chief executive.

“The main change is that there are a lot of new entrants to the graduate market. There is more competition between more employers. Employers struggle because there are only a limited number of students in the market. The more competition there is in the market, the lower the number of applications received by each company. »

Purchas’ comments are backed up by data from Seek that tracks the number of applicants who apply for each job posting. Candidate levels are at their lowest point in more than a decade.

Just ask 21-year-old Gabrielle George, whose first job after graduating in nutrition science from Australian Catholic University couldn’t be nicer – working as a food tester for the company Hello Fresh home-delivered meal kits.

“I came across the job on LinkedIn, then applied through the company’s website,” says George. She only applied for two jobs, was interviewed for both, and accepted Hello Fresh.

Gabrielle George landed her dream job as a food tester for home-delivered meal kit company Hello Fresh. oscar colman

“I work in the test team. Developers will develop recipes, and then we will test those recipes. I do the second cook.

With job seekers in the driver’s seat, employers are finding they need to adjust their work practices to provide mentorship, development and training. And wages are also increasing. Gorton says salaries are rising 3% to 15% at finance, technology and accounting firms represented by Robert Half.

“Companies definitely need to rethink their benefits, because what’s important to people has definitely changed from what it was two years ago,” Gorton says.

Salaries still to catch up

But if the definition of skills shortages is an increase in wages, it doesn’t show up in official data, Hogan says.

“People usually change jobs to get a higher salary. I expect to see this in most specialist and professional sectors over the next few months. Turnover is important. It’s usually the catalyst and it’s a leading indicator,” says Hogan, managing director of EQ Economics.

Economist Warren Hogan says people usually change jobs to get a higher salary. Dominique Lorrimer

Although the salaries offered for jobs on Seek are not increasing, Broderick clarifies that he only has visibility on what is advertised, not on the final negotiated package. The two could be very different.

Broderick says many companies are reluctant to set the bar higher on what they offer. This, he says, is reflected in the Australian Bureau of Statistics’ Wage Price Index, which assesses the movements and wages of the entire labor force.

“But if there are pressure points and companies can’t fill new roles or replace existing ones, it will take some time before it starts to impact the existing employment base and the wages, but then the impact will be much bigger,” says Broderick.

There are many reports on many industries, especially law firms and professional services, coming soon. under pressure to raise wages to stay competitive and retain good staff.

Even graduates are attracted to a “boost” or signing-on payments, in areas of “skills demand where we know we are in competition to attract great talent,” says Dorothy Hisgrove, director of human resources at KPMG.

Dorothy Hisgrove, people manager at KPMG.

She describes this year’s starting salaries as being “in line with competitors and, in some markets, above those of our peers.” The position for 2023 is being revised, says Hisgrove.

Job security key

At the same time, COVID-19 has seen a profound shift towards people who value job security. Seek, for example, found that two in five candidates say COVID-19 is the main reason for not switching roles.

“The desire for security has really taken hold over the past two years. This whole idea of ​​last in, first out plays in people’s minds. There has been a real shift in how candidates approach their next career move,” Broderick says.

The jury is out on whether Australia, like the United States, is experiencing the “Great Resignation”. Broderick says there are early signs that such a phenomenon could take hold in Australia.

“Seasonality is probably what’s holding it back,” he says. “The Christmas period is not traditionally the time when people are looking to change jobs, but they are most active in the first quarter of the year.

“We don’t have any clear evidence that the big quit is happening. But that doesn’t mean it couldn’t happen here.

Marian Baird, head of work and organization studies at the University of Sydney, agrees. “I think it’s more of an American phenomenon. I haven’t seen enough evidence to say this is actually happening in Australia, but COVID-19 has made people rethink what they want. But I don’t think the economy is strong enough for people to quit their jobs just yet,” Baird says.

Gorton, however, is convinced that a big resignation is already underway. “Without a doubt. People are definitely rethinking what they want their professional life to be like. And if they can’t get it from their current employer, they move on,” Gorton says.

Labor shortages worry CEOs

Hisgrove says KPMG’s annual survey of Australian CEOs found that 70% of business leaders cited labor shortages as their biggest challenge for 2022, and they expect this continue for the next three to five years.

For some sectors, supply significantly exceeds demand. Grace Paul, 23, an honors science graduate from the University of Sydney, was one of nearly 1,000 applicants for a graduate position with global design, engineering and management consultancy firm Arcadis.

After submitting her CV to around 30 companies for her first post-graduate job, Paul did two online interviews and one face-to-face for the position at Arcadis, which she accepted without hesitation. “I just applied for whatever seemed interesting. I knew it was very competitive and I didn’t expect to land my dream job on the first try,” says Paul.

This surge in demand has empowered applicants, leaving companies struggling with applicants rejecting early offers in some cases. About 90% of students told GradConnection that they would continue to look for positions even if they had accepted an offer, believing that a replacement option was a smart move and that having multiple offers gave them a way to negotiate a better offer.

Although the job seeker is firmly in the driver’s seat, Gorton notes that there is a downside for existing employees.

“Skills shortages are so great that existing talent is running out. We talk daily to employees who are exhausted because they have to do the work of two or three people. And the increase in demand for graduates is partly because companies are getting smart and using graduates to help support older people,” says Gorton.

For companies, the balance between attracting and retaining staff without causing burnout will be the challenge of the next few years. With relative bargaining power having shifted to employees, there will likely be widespread cultural ramifications for businesses.

“Because people can pick and choose, there’s no doubt there will be an acceleration of the idea that there’s more to life than just making a lot of money,” Hogan says.

About Jessica J. Bass

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