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Pilot Episode 1
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Recruitment News Australia Episode 1
Introduction episode where Adele & Ross discuss how the podcast came to be and together they tackle the question of the week.
Question of the Week: The 4-day work week in recruitment, is this realistic?
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Transcript
Introduction to Recruitment News Australia
00:00:11
Speaker
Welcome to Recruitment News Australia, your weekly dose of news and issues relevant to the Australian recruitment industry. We will also tackle hot topics in our question of the week, answering recruitment related questions from our listeners. Join us every Tuesday on Recruitment News Australia with Ross and Adele. Adele, this is issue one. Let's tell the people how Recruitment News Australia came to be.
Origin of the Podcast and Weekly News Curation
00:00:39
Speaker
Well it was an idea Ross that we came together with at the RCSA conference in Hobart last year over a coffee in one of the breakout sessions we came up with the idea of providing a central news source of information for the industry. So what we'll be doing each week is curating sources of different news from across our industry in Australia and overseas and providing all that information in one location for you on this podcast.
00:01:06
Speaker
We'll also be addressing common issues and relevant content to the industry and in our hopes creating a bit of a community and a learning platform for our listeners. And my name's Adele Last. I've been working 26 years in the recruitment sector for a range of small private and larger publicly listed recruitment agencies
00:01:25
Speaker
I've worked as a GM and managed recruitment businesses before starting my own company three years ago involved in creating a pathways program, including training for new recruiters coming into our industry. Ignite chairman Gary Sladden has announced the appointment of the fifth CEO of his tenure after the news of incumbent CEO Tim Moran's departure.
Leadership Changes at Ignite
00:01:54
Speaker
Former Chandler McLeod CEO Cameron Judson will move from a non-executive director position to CEO, effective immediately. Since he departed Chandler McLeod in mid-2015, Judson has had a succession of shortish tenure CEO and board roles, none of which have been in the recruitment sector until he joined Ignite board last March. The real pain for the departing CEO isn't losing his job, it's the substantial hit Moran has taken to his personal wealth.
00:02:23
Speaker
In March 2022, he purchased just over 8 million shares in Ignite at $0.18 a share at a cost of nearly $1.5 million. He was instantly the third largest holder of Ignite shares. Today, Tim Moran's stake in Ignite is worth just $583,000. The company's share price peaked at $3.84 on the first day of December in 1999 when it was still known as Candle.
00:02:49
Speaker
The share price hasn't been above $0.30 for well over a decade and it was last above $1 in 2009. Moran's last aid ignite is officially Friday 31st March.
Consumer Misleading and Review Integrity Concerns
00:03:03
Speaker
Industry News Service shortlist last week reported concerns about the potential breach of consumer laws by SEEK-owned recruiter review site Saucer.
00:03:12
Speaker
The functionality in question is the option on the Salsa platform that allows users to add to their Salsa profile pre-existing customer testimonials from other sites, such as Google or LinkedIn. The specific concerns being when recruiters upload historical reviews to Salsa, they are dated at the time of the upload, not the time of the original review.
00:03:35
Speaker
The functionality that allows a star rating and a heading to be added to the third party review when such a star rating or heading is not a feature of the original third party review. These three features available to sources customers appear to unambiguously mislead consumers based on the following general advice offered by the Australian Competition and Consumer Commission spokesperson quoted in the shortlist article.
00:04:03
Speaker
Review platforms may mislead consumers in editing and publishing reviews on third-party websites. This may occur through a platform adding its own star rating to a consumer review, creating a new headline for that review, or changing the date of a review so that it is more current. According to the spokesperson, platforms that engage in this sort of conduct risk misleading consumers and breaching Australian consumer law.
00:04:31
Speaker
Shortlist article included responses from both Salsa and Seek, neither of which specifically addressed the three areas of concern raised by Shortlist.
Labour Market Trends and Data
00:04:42
Speaker
In January 2023, the seasonally adjusted labour market results showed a slight decline in the key measures except for jobs listed on the internet. Total employment decreased by 11,300 people to 13.72 million.
00:04:58
Speaker
Full-time employment decreased by 43,300, while part-time employment increased by 31,800 people. The participation rate decreased from 66.6% to 66.5%. The unemployment rate increased from 3.5 to 3.7%. The total number of unemployed people rose by 21,900 to 523,200 people.
00:05:25
Speaker
After the past two months of slight decline, job vacancies listed on the internet rose by 2% on the December figure, and this represents a 4.5% rise on the January 2022 figure. Tasmania reported the largest percentage rise of more than 9%, followed by South Australia and Queensland at 6.7% and 3.9%, respectively.
00:05:48
Speaker
SEEK also reported increased advert volumes. In January, month-on-month job ads rose for the first time since May of 2022, up by 2.8%. Applications per job ad increased by 9.2% in December.
00:06:05
Speaker
ASX-listed IT recruiter High Tech Group reported revenue for the six months ended 31 December 2022 of $40.7 million, a year-on-year increase of 37%.
Recruitment Industry Financial Updates
00:06:17
Speaker
Gross profit climbed 21% to $4.9 million, and even a rose 10% to $3.2 million. Japan-based staffing firm Outsilcy, owner of local brands Clix, Hoban, Bluefin,
00:06:33
Speaker
PM partners Jigsaw and Horizon One reported revenue for the full year ended 31 December 2022 of US$5.18 billion, an increase of 21.2% when compared to the previous year, although operating profit declined by 8.1%.
00:06:53
Speaker
ASX listed people in, reported revenue for the six months ended 31 December 2022 of $597 million, a year on year increase of 89%. Existing operations reported growth of 21.3%. Normalised EBITDA rose 51% to $32.5 million and people in reaffirmed its 2023 financial year earnings guidance of $62 million EBITDA.
00:07:23
Speaker
Seek December 2022 half-year update reported the following. Net profit after tax of $135 million up 10%. Seek ANZ revenue $455 million up 19% and seek ANZ EBITDA $276 million up 8%. Ad volumes by buyer category saw agencies report 22% market share
00:07:50
Speaker
down from the 46% market share of total ad volume reported in 2019. Hayes July to December 2022 half-year results saw Hayes ANZ net fees reportedly down 1%. Hayes ANZ operating profit was down 36% to 31 million. Per net fees up 7% and temp net margin down 6%.
00:08:19
Speaker
Hay's ANZ consultant headcount was down 2% for the six months to 1,110 consultants. Western Australia is trying to poach British workers by tempting them with promises of higher salaries and lower bills in contrast to the UK where inflation strikes and a cost of living crisis have dominated the winter months.
International Recruitment Campaigns
00:08:41
Speaker
We're here to steal your workers by offering them a better life in one of the most beautiful places on the planet, WA Police and Public Safety Minister Paul Papalia will reportedly say in a new campaign. Mr. Papalia will lead a delegation to London and other cities later this month, which will be focused on filling 31,000 vacancies with skilled workers, including mechanics, builders, plumbers, dentists, police officers, and hospitality workers.
00:09:08
Speaker
Brits under the age of 35 will be able to travel and work in Australia more freely under the terms of the agreement struck in 2021, one of the UK's first post-Brexit trade deals. As part of the recruitment drive, WA officials have produced comparative data showing median Australian salaries are higher than their UK equivalent, as well as promoting Perth as having nearly an average of nine hours of sunshine a day.
00:09:34
Speaker
proximity to the beach, toll-free roads, low-cost public transport and better traffic are also listed as benefits. New Zealand's December 2022 quarter produced largely stable labour market results according to statistics New Zealand. Total employment rose quarter on quarter by 0.2% to 2.85 5 million workers.
00:10:00
Speaker
The unemployment rate rose slightly from 3.3% to 3.4%. The labor force participation rate remained at 71.7%. Average ordinary time earnings rose 7.2% over the year to reach $38.19 per hour. Last week, New Zealand Prime Minister Chris Hipkins announced the adult minimum wage will be rising by $1.50 an hour to $22.70 per hour beginning one April.
00:10:32
Speaker
And last week, the ABC reported the Victorian government is being urged to investigate the City of Greater Geelong's recruitment of high paid staff amid accusations of nepotism and the risk of soft corruption.
Issues of Nepotism in Recruitment
00:10:45
Speaker
Financial documents have revealed senior officer salaries have increased dramatically. In 2020, 37 staff earned more than $150,000 per year. And the following year, this number rose by 43%. The city is already under investigation over its recruitment of a new CEO,
00:11:02
Speaker
after the state's chief municipal inspector raised concerns the transparency and integrity of the process might have been compromised. Geelong Council was sacked in 2016 following a three-month investigation that found a deep-seated culture of bullying across the organisation, along with a host of further governance concerns.
Debating the Four-Day Work Week
00:11:29
Speaker
So our question of the week this week is about the four day work week in recruitment. Is this realistic Ross? I think yes, Adele. Firstly, agencies are making it work. I know it's a fairly small sample size at the moment, but there's been some very positive feedback from companies that are going down that path. Secondly, I think this is a critical step in potentially addressing the turnover issue we have in our industry.
00:12:00
Speaker
turnover rates between 35 and 45 percent per annum in our industry. There's a lot of burnout and that does concern me and I think in terms of the well-being of people and longevity in our industry, four days a week work and three days rest could be very helpful in that regard. Related to that of course is making our industry more family friendly. People with parental or caring responsibilities
00:12:29
Speaker
I think I'm more inclined to be attracted to or stay in our industry because they're working four days and having three days off or potentially even scaling back if they see that the industry is sympathetic and actively promoting a four-day week than people who can only work or only want to work say three days a week or even two days a week. I think I'm more encouraged to enter the industry or potentially stay in the industry.
00:12:59
Speaker
And the third point is, frankly, I think it will help agencies be more brutal about the work that they're going to take on and not take on. If you are working four days, not five, you really can't afford to take on too many jobs where there's a low probability of filling that job. And I do think this is a big factor causing burnout in our industry. Many people doing too much work on assignments, they ultimately do not get paid for. So I do think it will help.
00:13:29
Speaker
people be a lot more commercial about things that they're working on and to maximise the time they're spending on the assignments that they believe they have the highest likelihood of filling.
Implementing a Four-Day Work Week
00:13:42
Speaker
Interesting point, Ross. I have some real concerns so I'm going to take the more negative response to this one and say I'm really not sure it is realistic in recruitment because we are very client-directed in the way we work. It's a very service-oriented industry and we
00:13:59
Speaker
need to be able to match our client needs when they occur. So I struggle with the idea of how a very service-oriented, client-directed industry is going to be able to say to a client, I'm not available at that time, whether that means because the business is closed on the fifth day or the recruiter is not available and someone else has to jump in. And as we know, sometimes clients don't want to deal with
00:14:24
Speaker
a different contact. So that's my first point. The next one I'm concerned about is managing time in this process. It takes a very sophisticated time management process to be able to squeeze five days work into four days. And to be perfectly frank, I just see a lack of discipline in the industry being able to do that. I'm not sure that people understand what it takes to be able to gain those efficiencies, I suppose, in the way we work and squeeze the five days.
00:14:54
Speaker
into four. So that's my second concern. And then my third one comes from my days as a temp recruiter of just understanding how fickle the temp client can be. They want to speak to you that day. They want to be able to get to you with a sense of urgency and they want to respond straight away. So
00:15:13
Speaker
My concern is what happens when they can't get you and they need to speak to a colleague who they don't know or don't, don't feel they, you know, understand their work environment or their needs or your office is closed. You know, will they simply go elsewhere? You know, how will it work with your temp business? Will you lose clients? Hmm. Okay. Well, let's finish with some recommendations or things to consider.
00:15:41
Speaker
Because if you are an owner thinking about this, then let's offer you something. All right. So firstly, I would recommend that you start with a pilot program, maybe three or six months, because if you give something, it's very hard to take it back. Whereas if you say to your team, it's a pilot program, it needs to work. We have a three month timeframe.
00:16:09
Speaker
to make it work or a six month timeframe. I think it generates mutual responsibility, the job of the owner or the leaders of the business to make it work. Secondly, if you are a business that has both temporary and permanent recruitment, there may need to be
00:16:32
Speaker
some slight differences because of the nature of temporary or labour hire or contract work where jobs can come in and be lost on the same day and that's a far less frequent occurrence in permanent recruitment. So you may just need to consider the
00:16:49
Speaker
should be or might need to be tweaks in the difference between those divisions. Adele, what about others? Yeah, I think also clarity on the details of things like which days. How is it going to work in terms of the day off? Is it a rotating system? Is it the same day for each person each week? How will things like sickly be managed? Are people going to be able to
00:17:13
Speaker
switch days if they need to, if they're not well, those kind of things. So I think some real clarity around the details, you need to sit down as a business owner with your leaders and work those kind of details out so that you've covered every scenario, as well as the expectations of the day off, because that's another area I think that could be an area of concern is
00:17:34
Speaker
What happens on that fifth day? What is the expectation from the business to the employee? Are you expecting that they have their phone on and take a call? Can they turn it off? Do they need to log in if something urgent happens? And then what occurs for that? Do they get that time back in lieu? Or what actually happens on the fifth day? So clarity on details, managing expectations on the fifth day.
00:17:58
Speaker
And then my final bit of advice to somebody thinking about this as an option would be to make sure you understand your reasons for doing it, why you're introducing this into your business.
00:18:09
Speaker
and make sure you've got some really key metrics in place so that you can measure the things like job fill rate and speed to make sure that you can see that it's working. You may also be measuring things like morale and staff turnover and lack thereof. So there should be both positive, hopefully mostly positive, more than negative impacts, but you want to make sure that you are measuring them either way.
Conclusion and Subscription Reminder
00:18:38
Speaker
Welcome to the Recruitment News Australia Podcast with Ross Clannan and Adele Last, giving you your dose of recruitment news and information. That's a wrap. Don't forget to subscribe to the podcast wherever you get your podcasts from, Google, Apple, Spotify or on our website.