Xero slows hiring rate as volatility, talent shortage hits

Scarce talent and market volatility have cooled the jets of Xero’s hiring spree just months after the cloud accounting giant announced it would hire 700 staff this financial year.

Xero chief executive officer Steve Vamos, right, and Asia director Joseph Lyons.

Scarce talent and market volatility have cooled the jets of Xero’s hiring spree just months after the cloud accounting giant announced it would hire 700 staff this financial year.

Speaking to The Australian on the sidelines of Xerocon – the company’s annual accountants conference – chief executive Steve Vamos and chief technology officer Mark Rees confirmed the company was struggling to find senior talent and it was being “cautious” with its hiring rate.

“We find that really senior talent, in engineering, data and skills, are still really scarce. There’s so much demand for them, particularly in security,” Mr Rees said.

“While we’re still really comfortable in our ability to hire ­people, the current economic environment has changed around the world so we’ve been more cautious and thinking about the way we hire and the rate at which we hire just acknowledging that volatility and seeing what some of our key companies are doing in the US.”

The move from the ASX-listed company comes amid cost-cutting at several Australian start-up and tech darlings, with Mr Yum cutting 17 per cent of staff and Linktree 17 per cent, while e-sports company ORDER has closed altogether.

Xero’s C-suit executives would not disclose the progress of the company’s hiring plans.

Mr Vamos said the company would look to foster the skills of its current staff and train its employees, as closed borders had reduced the talent pool of overseas workers.

“We’ve just had a couple of years where the flow of people to opportunity has slowly almost come to a stop,” he said.

“When people can’t move and the labour market can’t self-adapt to where the opportunities are, that causes the situation we have today. More broadly, there is no question that good technology talent is always in shorter supply than you would want.”

In earlier interviews, Mr Rees told The Australian that at least 20 per cent of Xero staff were on remote contracts and the company was not shy of looking abroad to fill skills gaps.

Mr Rees signalled that Xero was keeping a close eye on market movement in the US and the flow-on effect it has had on its customers. “While we haven’t seen a direct impact on the market yet, we’re being cautious and watchful in terms of how that changes,” he said.

Xero also announced it would invest $NZ472m ($423.8m) in product design and development this year, a large amount of which would be invested in AI.

Mr Rees said Xero was focused on three key areas of AI, including the capability to ingest data from PDFs and images, to develop business graphs, and to identify patterns and trends based on transactional data.

AI that could identify spending patterns formed part of Xero’s product Analytics Plus, which informed small business customers which invoice should be paid first and provided an overview of upcoming bills, Mr Vamos said.

The future of AI in accounting would involve “taking a customer’s data in Xero and creating insights – insights that can be linked to next best action,” he said. This was a part of Xero’s long-term goal of “democratising advice” and providing a coaching-like service to small business owners.

“It’s (about) creating a software environment which handles accounting and compliance and goes beyond that, with the collaboration of a small business with their accountant bookkeeper and beyond that with applications and services,” Mr Vamos said.