Redundancy fears holding Australian workers back from changing jobs

The fear of being the “last in, first out” is holding workers back from seeking more lucrative salaries. But experts have a different view on this.

Redundancy fears are making Aussie workers reluctant to move to higher paying jobs. But experts say the concerns are unwarranted and there are still plenty of lucrative opportunities with long-term prospects.

Fear of being the “last in, first out” – whereby the last employees hired will be the first to be let go if a company needs to make job cuts – is likely keeping two-thirds of Australians from looking for a better paid role. This is despite many feeling the cost-of-living pinch, new research reveals.

Almost half of Aussies are worried about being made redundant, according to recruiter Randstad, having been spooked by persistent talk of a recession, job cuts at corporate giants such as Telstra and the demise of organisations like budget airline Bonza.

But experts say there is no need for panic and that stable job opportunities are still plentiful.

“Yes, it feels a bit grey,” says Randstad professional talent solutions director Jo Jakobs. “But this is as good a time as any to look for work, especially if you need more pay or there’s a lack of progression or flexible work arrangements in your current job.

“We are still at almost record low levels of unemployment and there’s still an enormous scarcity of people with specialised skills in the market.”

Amber alert

Australian workers are becoming more risk adverse as high living costs continue to bite, Jakobs says, preferring any job, regardless of the pay, over the prospect of no job at all.

But she stresses sentiment expressed in the Randstad research is not the reality of the current job market, which she says is still strong, albeit slowly returning to pre-Covid conditions.

“If you look at some of the news that’s come out recently (around redundancies) then I guess you can understand some of the concern,” Jakobs says.

“I wouldn’t say people are on red alert (over job losses) – they might be at amber.

“But nearly 50 per cent of people being worried about (job cuts) doesn’t make it true that 50 per cent of people are going to lose their job.

“There are still some great jobs out there and (employers) are still going without workers because of the shortage of talent.”

Jakobs urges cash-strapped workers to explore other employment options so they can make an informed decision about whether to stay in, or leave, their current role.

“If people are deeply unhappy in their work or they’re looking for progression and they can’t find it in their current organisation then, yes, now is the time to seek out and explore new job opportunities,” she says.

“No one risks anything through exploration and discovery and that’s something all of us should be feeling very confident to do.”

Marketing professional Talita Tuipulotu.

‘It doesn’t take up brain space’

Poor pay and a lack of career satisfaction caused marketing professional Talita Tuipulotu, 30, to change jobs last month.

She admits quitting her old role to become the newest hire at her present company did cause a moment of anxiety, with fears of becoming the “last-in, first-out”.

“We are in a bit of an economic crisis so I was thinking, ‘have I done the right thing?’” she says.

“But being mentally happy outweighed everything else.

“I love what I do now. (Changing jobs) was definitely the best thing for me and (the thought of redundancy) doesn’t take up much brain space anymore.”

Old rules don’t apply

Almost two-thirds of businesses expect to increase staffing levels in the next year, which experts hope will relieve worker anxiety about being made redundant, new research from recruiter Hays shows.

In any case, Hays Asia Pacific chief executive officer Matthew Dickason says employers no longer rely only on tenure when it comes to making job cuts, preferring to make decisions based on the value each worker brings to the company.

“That (last-in, first-out redundancy method) has its drawbacks. It leads to a loss of new talent that can bring in new ideas and skills,” he says.

Dickason says workers can reduce their risk of redundancy by ensuring their skills remain up-to-date and in-demand and seeking feedback from their employer about how they are performing and the areas in which they can improve.

Focusing on industries that are experiencing strong growth also puts workers at an advantage, he says, noting the human resources and accounting sectors are among those intending to significantly increase staffing, while hiring in construction remains downcast.

Overall, Dickason says the future is still bright for workers.

“There’s undoubtedly still skills shortages that exist in the marketplace,” he says. “I don’t think you need to be worried about job security.”

Worker sentiment

– 44 per cent of Australian workers are worried about losing their job, up from 27 per cent in 2023.

– 67 per cent of workers feel too risk averse to jump jobs for better pay, even if they have not received a pay rise in the past two years, as “last-in, first-out” concerns weigh heavily.

– Instead of switching jobs, 19 per cent of workers – about 2.6 million Australians – have or are considering taking on a second role or increasing their hours with their current boss to meet rising costs of living.

Source: Randstad