No hope on jobs without radical change: Seek’s Andrew Bassat

Seek CEO Andrew Bassat. Picture: Aaron Francis

Seek boss Andrew Bassat says Australia has no hope of making up lost jobs from COVID-19 unless the country makes radical changes, with business taking more risks and government providing direct investment incentives and more than just tax cuts.

Bassat’s downbeat economic forecast was reflected in the online recruitment platform’s lower than expected guidance following the 2020 year results briefing.

While saying the guidance numbers were only “illustrative”, they were enough to spook the market, with forecast revenue of $1.5bn the lowest since 2018 and earnings before interest tax and depreciation of $330m the lowest since 2014.

Seek’s forecasts compare with market estimates of revenue totalling $1.7 billion, up on the 2020 year, and earnings at $437 million compared to $414 million in 2020.

The dismal outlook resulted in a 9.7 per cent fall in the company’s share price.

Bassat had already warned the market there would be no dividend and he sees the last 12 months as showing Seek in its true colours, focused on long-term growth at the risk of short term profits.

While advertising volumes fell by as much as 65 per cent at the height of the COVID-19 crisis, they are still down by 30 per cent. However Seek has maintained local employment levels to handle the recovery.

“Job creation will be at the centre of any economic recovery and Seek is well placed to play a meaningful role,” Bassat said.

Seek’s Chinese operations have recovered from steep early falls to be down only slightly in the fourth quarter.

If mirrored elsewhere this would suggest a quicker bounce back than Bassat is tipping.

Overall, Australian revenues fell 12 per cent and earnings by 15 per cent while Asian revenues fell 14 per cent and earnings by 26 per cent.

Mexico and Brazil both remain basket cases due to COVID.

In an interview Bassat said: “We looked at cutting costs but we have opted for long term growth by cutting contract margins and made no staff cuts.”

The country, he said, “hasn’t seen the full extent of job cuts needed”.

Bassat said business needed “more direct incentives from government”.

He added: “Business needs to take more risks.”

Without these changes “we have no hope of making up the jobs lost”.

“My hope is we can match skills needed with those on offer and draw up a map to put them together, but there is still too much friction in the system “ he added.