The Australian Two-Speed Economy

The Australian 'Two-Speed' Economy - Australia

The Australian ‘two-speed economy’ is affecting the need for specialists in the HR market, says Peter Barber.

Australia is still a ‘two-speed economy’, with a strong mining sector (albeit plateauing somewhat) largely confined to Western Australia and to Queensland contrasted with slow to negative growth in other states and sectors. That two-speed economy means that activity in the HR market is not necessarily consistent. The Prime Minister is soon to announce the date of the general election for later this year, so from an investment and business activity perspective, we expect that to have an effect in terms of activity in the next few months – some will be reticent to invest until after the election happens, with the major parties promising differing approaches to the laws impacting business in terms of incentives and taxation.

Where we have seen good levels of activity is in specialist areas such as talent management, culture and capability. These are not necessarily roles that we see recruited in softer economic times but some of our clients have continued to be active in these areas due to the specific needs within their businesses. And it’s still the case that key senior remuneration and benefits specialists and senior HRBPs will always find roles even if processes may be taking longer than usual.

Many major corporations now have well and truly bedded- down the business partnering model. There are shared services functions established in most leading businesses, and they’re at a level of sophistication where they can concentrate on senior talent and the specialisms needed to ensure that the business partners are supported. The transformations happening in a number of major corporations are absolutely dependent on the HR function, particularly OD practitioners, culture, capability and leadership specialists.

Corporations with a regional footprint will increasingly look into Asia for the specialist skills and capabilities that they may not find here. However, major players in the Australian market are also cognisant of the benefits of importing talent from the UK: people who have worked in complex corporate environments with a very strongly entrenched business- partnering model are highly regarded by corporations and other employers. That’s not just UK expats being able to secure work – and sponsorship is still possible for senior people – but it is also a point of difference for Frazer Jones that we can bring back Australians who have had that five-year stint in London and been exposed to a significant scale and sophistication of HR, and are now looking to return. Specialists are also being appointed for short-term project-based work, and as such we’re seeing more focus on contracting in the Australian market.

That includes contracting in some sectors where budget or headcount restrictions are precluding employers from engaging someone on a permanent basis, which reflects the softness in parts of the economy. It is also down to a more strategic use of temporary resources for discrete project work, even at a senior level.

Our clients are still subject to the high Australian dollar, uncertainty about the election, and the potential change in fortunes of the mining sector that has driven the economy so significantly over the past few years. But there are major projects on-going, for example the national telecommunications carrier Telstra has been carrying out targeted recruitment for senior roles in L&OD and HR. Similarly, the National Broadband Network, the government’s high speed broadband internet network, is the biggest infrastructure project in Australia’s history worth $10’s of billions (see Tim Drinkall’s article). Key players in the financial
services sector may have restructured but entities like Suncorp remain robust employers of HR talent. We expect to increase targetted HR recruitment activity this financial year, and our ability to source specialists will be further in demand.

Download the article

View & download the full report