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Dodging Bullets: How the Federal Election Impacts Recruitment

Posted by Nigel Harse FRCSA on 10 August 2019
Dodging Bullets: How the Federal Election Impacts Recruitment

A win for the Liberal Party is a win for the Australia recruitment industry. Find out why, plus learn the impacts of the election on permanent sales.

In the lead up to the Federal Election, the widely speculated change of government caused unrest in the recruitment industry. Fortunately, we've dodged a bullet with the Liberal Party prevailing. In this post, we reflect on why a win for the Liberal Party is a win for the recruitment industry. We also look how permanent sales were impacted in the months preceding the election, plus provide a broader view of permanent sales from May 2018 to May 2019.

A flexible workforce means a bright future for Australia's economy

The recruitment industry has made significant progress in the past 20 years, incorporating temporary, contract and flexible work into the employment landscape. The anticipated change in leadership threatened to stunt, or even reverse, that hard-earned growth. By targeting the labour hire sector and advocating for old employment awards to be reinstated, the Labour Party posed a significant risk to the future of flexible work.

Thankfully, under Liberal's leadership, companies can continue to call on temporary staff as needed. Employees can continue to enjoy the flexibility of casual and contract work. Most importantly, Australia's economy can continue buoyantly as it has for the past two decades.

The impact of the election of permanent sales

The predicted change in leadership had an unsurprising impact on employer confidence, with many employers reluctant to take on permanent staff. Nigel Harse of Staffing Industry Metrics analysed data from 102 recruitment agencies and found that perm sales came off the boil from September 2018. As the election loomed closer, they declined further. By May 2019, just weeks from the election, average perm sales were down 20% on figures from May 2018.

Recruitment Agency Australian Average Perm Sales

Moving Annual Total (MAT) show positive growth

Most growing recruitment agencies tend to focus on monthly data. While it's important to look at monthly metrics, annual data offers a more accurate view of what's really happening in your business.

A reliable method of measuring progress is to look at your Moving Annual Total (MAT). MAT gives you the sum value of sales over a 12 month period. By taking monthly fluctuations out of the equation, MAT provides a true indicator of the market over the longer term.

The chart below provides a different view of permanent sales in 2018-19 using the MAT method. While the data confirms a decrease in permanent sales just before the election, it also shows 7% growth over the course of the 12 month period from May 2018 to May 2019.

Recruitment Agency Australian Average Perm Sales Annual Total

With the election and end of financial year now behind us and with the Liberal Party remaining at the helm, the permanent market is poised for another record breaking year. Is your recruitment agency ready to capitalise on opportunities?

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Nigel Harse FRCSAAuthor: Nigel Harse FRCSA
About: Highly regarded and widely sought after for his knowledge, unwavering passion and innovation, Nigel is a 40-year veteran of the recruitment industry.
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Tags: Perm Sales in Australia Insights Blog Recruitment Agency Profit Federal Election

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