Christmas Job crisis: 1 in 3 Aussie companies set for job cull

A shocking new report reveals a looming job disaster in Australia, with a third of companies preparing for redundancies before Christmas.

Australians are facing a pre-Christmas employment nightmare, with a staggering one-third of companies planning to cut jobs in the coming weeks.

The latest report from the Australian HR Institute (AHRI) sounds the alarm on an impending job crisis, indicating that the public sector will be the hardest hit, where a dramatic 60 per cent of employers are set to make redundancies.

One third of Aussie companies set for mass lay-offs ahead of Christmas. Photo: Supplied.

The AHRI’s Quarterly Australian Work Outlook report, which involved more than 600 senior HR professionals, revealed a worrying trend of increasing job cuts, with 31 per cent of all Australian companies anticipating to make redundancies by the end of 2023.

“Almost a third (31 per cent) of respondents plan to make workers redundant in the December quarter of 2023, which is higher than the 17 per cent recorded in the September quarter of 2023,” the AHRI report highlighted.

The latest figures reveal a stark contrast across sectors when it comes to redundancy plans. The public sector sees the strongest blows with 60 per cent of employers intending to reduce their workforce, a significant rise from 29 per cent in June.

Manufacturing and production sectors are also among the hardest hit, with 37 per cent of employers preparing for staff cutbacks.

Redundancy intentions by sector. Source: AHRI Quarterly Australian Work Outlook December quarter 2023.

While a third of Australian companies anticipate lay-offs – there’s also a notable rise in recruitment intentions, jumping from 61 per cent to 71 per cent.

Sarah McCann-Bartlett, CEO of AHRI, sheds light on this paradox.

“Some of the factors that may be driving recruitment are ongoing high employee turnover rates, leaving essential roles vacant, and proficiency gaps among employers. This points towards recruitment as an ongoing backfilling activity rather than a response to, or driver of, business growth,” she said.

The report also flags the difficulty in recruiting in a tight market, with 47 per cent of employers experiencing recruitment challenges.

Employee turnover remains high at 14 per cent, particularly in the private manufacturing and production firms.

Employee turnover will remain high in manufacturing and production firms.

In a sign of increasing workplace stress, 40 per cent of employers reported a rise in staff taking sick or carers leave, driven by Covid-19, home responsibilities, and minor illnesses.

On average, workers took six days off in the last financial year.

AHRI’s report suggests that effective people management practices can significantly mitigate these stress factors.

“Cost-of-living pressures, work-life balance concerns, and excessive workloads are the most significant stress factors for workers,” the report stated.

Looking ahead to 2024, the economic outlook appears challenging, according to experts.

The mean basic pay increase in organisations is expected to be just 2.6 per cent over the next 12 months.

“The higher redundancy intentions, combined with modestly lower wage intentions, might mean economic challenges ahead,” Ms McCann-Bartlett warned.

“2024 looks a more challenging year for employers and workers. It will be important to consider strategic HR measures to control costs, enhance productivity, and attract and retain skilled employees.”