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Monday, 07 September 2020 12:23

Executive job creation slows down in pandemic, IT sector hit hard Featured


Executive job creation in Australia has slowed right down - with the IT sector dropping into negative territory - since the beginning of the pandemic, but things are “not that bad and certainly not as woeful” as it is for skilled and semi-skilled workers, according to executive search firm EL Consult.

The slowdown hit the Information Technology sector hard, with IT - along with marketing - negative on the EL index for hiring executives in the month of August.

The EL Consult September report covering executive hiring in August shows that among the sectors, Management, driven by government hiring, was the best performer, followed by Engineering and Finance, "while Marketing and Information Technology were negative for the month".

Grant Montgomery, Managing Director of E.L Consult, says Australian governments haven’t cut any of their senior positions and are hiring at greater than replacement levels, commenting that “whether this is a deliberate strategy to boost the economy or simply a response to on-going budget growth remains to be seen”.

Montgomery says the picture for government hiring shows up in the “Management” sector which is primarily government positions, and management hiring numbers by volume have overtaken “Finance” as the largest number of new positions available and now stands at 40% of all executive hires.

According to EL Consult, the private sector is suffering much more but with the help of working from home strategies the overall loss of positions is limited and, in fact, states like NSW, Queensland and South Australia are hiring for new positions.

Montgomery, says that “working from home coupled with invigorated government hiring has stopped a massive unemployment shakeout in senior executive ranks”.

“The private sector is suffering more but this hasn’t impacted the figures by much as might be expected. What is likely is that small businesses are quietly putting up with the situation in the hope that the lockdowns will end soon. There really is no choice apart from closing their businesses altogether. No one can accurately say when things will return to normal and in most cases, they have debts and obligations that simply cannot be turned off.

“Unfortunately, the final step for many businesses is bankruptcy which once started could leave economies like Victoria’s in a position irrecoverable for a generation. “Let’ s all hope the lockdowns don’t go that far.” Montgomery said

“The E.L Index rose 8% overall in August, showing a continuous slow recovery that has been in place for four consecutive months. This national growth is driven by NSW which had a 13% increase.”

“Actually, Victorian demand rose by 1 per cent this month but this is not near replacement level and was boosted by government hiring.”

Montgomery says that “despite the enjoyment of it working from home” it is not a long-term solution for most executives.

“It is very difficult to hire people for senior positions on a work from home basis. Someone new needs to learn the cultural, social communication and ethical attitudes of the company and their team and just interviewing someone and emailing them a work schedule is bound to fail in the long term,” Montgomery notes.

“While productivity might initially rise, most studies have shown it falls rapidly once the novelty passes.

“Talking to each other is important for problem solving and accountability. And Zoom meetings are not a long-term replacement for face to face communication. Social interaction can be ignored for a short period, but this necessary part of teamwork cannot take place from computer screens on numerous kitchen tables in the burbs.” Montgomery concluded..

Across the states, New South Wales produced the strongest gain, followed closely by Queensland, while Western Australia was negative, the ACT was flat and Tasmania was negative due to a fallout in engineering positions.

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