As we all know, it’s an employee’s job market right now. Unemployment is at its lowest since the early 70s, and workforce participation is at record levels[1].

Astonishingly, in absolute numbers there were more unemployed Australians in 1982, when the population was 11 million less[2].

The upshot is that right now there are 432,000[3] jobs available for the 507,000[4] people looking for work. Which means it's impossible to fill all those vacancies, as there will never be a perfect mapping between the skills of all the people looking for work at any given time, and the jobs available.

Vacancy rates by sector

In the administrative and support sector, which includes contact centres, the level of vacancies remains 10% higher than pre-pandemic levels, with 34% of businesses reporting unfilled jobs, and a 9% vacancy rate as a proportion of total jobs in the industry – by far the highest. Think about that. It means that for every ten people who work in a contact centre, there is one more job that remains unfilled.

While the vacancy rate for nearly all sectors is double what it was pre-pandemic, the data suggests that contact centres are having a harder time than most attracting the staff they need. The table below shows the latest job vacancy rate for selected industries:

We’ve tried a few different things since COVID-19. We brought on temp staff as we didn’t know what the future looked like. We’ve gone back to permanent staff now to find the right people who want to work with us long term. We have an ‘always on’ recruitment strategy both internally and with our agency. We bring on a few people a month to keep numbers up.

General Manager Member Engagement, Large Super Fund

Reasons for vacancies

What’s interesting are the reasons employers give for these vacancies. The main one is to replace a staff member who left or resigned. That is cited by 80% of employers today, and it’s only risen 1% since the pandemic despite the so-called Great Resignation.

What has increased significantly is the number of employers citing increased workload as a reason for vacancies. Reported by 36% pre-pandemic, today 44% of employers say it’s the reason for job vacancies. That increase suggests some of these are new jobs, not just replacements for staff members who have left.

Some of the increase in workload is due to the difficulty in hiring, which could potentially be down to reduced immigration and population growth since the pandemic. Those businesses that survived the pandemic are also busier as some of their competition had to close down. Additionally, sick rates have skyrocketed[5], so absenteeism is a major issue right now.

Where are jobs being created?

An interesting picture emerges when you look at all the jobs that have been created since the pandemic. From its pre-pandemic height in February 2020, the Australian economy has added 1,060,000 jobs. These have been overwhelmingly in the healthcare, processional services, construction and education sectors.

The administration and support services sector, which includes contact centres, has actually shrunk in headcount since the start of the pandemic.

Paradoxically, the sector also has by far the highest rate of unfilled vacancies. So there is demand for more workers. The industry, however, appears unable to attract them.

What we seem to be seeing is a flight by workers to more traditionally stable, secure, well-paid and full-time jobs such has those offered by the healthcare, professional services, construction and education sectors. Public administration, financial services, and mining have also grown considerably.

It’s the economy

An economy that is creating lots of new jobs, as Australia’s currently is, is usually an economy doing well. However, Australia’s GDP growth is slowing down[6], inflation is heading north at an alarming rate[7], and wage growth is so sluggish that, in real terms given rising inflation, most workers are getting pay cuts[8].

The current situation is largely still a hangover from the COVID-19 pandemic. A combination of factors including low immigration, an ageing population many of whom are retiring early, high levels of sick leave due to COVID-19, people leaving the workforce due to mental health and work-life balance issues, and a technology skills gap have left Australia severely understaffed.

All this has happened at a time when the printing of endless money by governments around the world to get us through the lockdowns has caused an inflation crisis. Inflation brings with it double jeopardy: not only does it make workers feel poorer – because in real terms they are – it also suppresses the wage growth that might alleviate that as governments and employers resist adding to the inflationary bonfire by putting up wages.

However, none of that changes the fact that this is a job market in which employees are dictating the terms to employers. For organisations that need to recruit – as so many do – we recommend finding out exactly what employees want, so you can attract them to your business, and build a new employee value proposition around that.

It’s definitely a tight labour market. Not having access to our usual educated backpackers has made it difficult for contact centres. When we do make offers to candidates, they now quickly get counter-offers. We’ve increased our salary package as there’s more competition for the same people. We’re also losing more people than usual to other areas of the business, like underwriting and operations, as they are finding candidates hard to come by too and the contact centre is a good feeder.

Head of Member Services, Large Insurance Mutual Fund

What can contact centres do?

Like everyone else, your employees and your customers are probably feeling the pinch. As we have seen from the job market numbers, contact centres are having a hard time attracting staff and also have the highest vacancy rates.

Contact centres that find themselves in this position have a few options open to them. First of all, you can degrade your service levels – as we saw many large businesses do during the pandemic staff shortages. But customers will only put up with longer wait times for so long.

You can also invest more in self-service and AI technologies to improve efficiency and productivity. This requires you to have money available to invest, of course. However, it still remains to be seen whether customers are truly comfortable with increasing levels of automation.

Asking more of your existing staff is also likely to be self-defeating. Overwork and stress are leading causes of attrition, and if you can’t replace people when they leave it’s only going to leave you even more understaffed than you already were.

We believe that the answer for any contact centre finding it difficult to fill their vacancies with the right people, is to fundamentally reinvent your Employee Value Proposition and refresh your recruitment process.

Contact centres have one great advantage over most other sectors; they are genuinely able to offer flexible, hybrid and home working. This should open up all kinds of opportunities to attract employees from talent pools previously untapped by the industry.

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Footnotes:

[1]https://www.abs.gov.au/statistics/labour/jobs/job-vacancies-australia/latest-release

[2]https://www.afr.com/policy/economy/the-jobs-boom-in-nine-charts-20220818-p5bauk

[3]https://www.abs.gov.au/statistics/labour/jobs/job-vacancies-australia/latest-release

[4]https://www.abs.gov.au/statistics/labour/employment-and-unemployment/labour-force-australia/latest-release

[5]https://www.theguardian.com/australia-news/2022/aug/18/sick-days-double-the-normal-winter-rate-in-july-abs-data-shows

[6]https://www.abs.gov.au/statistics/economy/national-accounts/australian-national-accounts-national-income-expenditure-and-product/latest-release

[7]https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/consumer-price-index-australia/latest-release

[8]https://www.abs.gov.au/media-centre/media-releases/slower-increase-average-weekly-full-time-earnings