December Employment Market Update

Australian employers project minimal pay rises in 2024

According to Staffing Industry Analysts, most Australians shouldn’t expect pay raises above the inflation rate of 5.4% in 2024. A study reveals that 58% of employers don’t plan to offer increases exceeding 5.4%, potentially resulting in real-world pay cuts.

Jobseekers’ confidence in opportunities has declined, dropping from 38% in 2022 to 17% in 2023. Despite 74% of employees looking to change roles, pay becomes a lesser motivator in 2024, with only 22% considering a move for a higher salary, compared to 56% in 2023. The shift toward an employer’s market emphasizes job security and career development over pay.

Quarterly Australian work outlook for December quarter

AHRI’s quarterly report on the Australian labor market indicates ongoing strength in net employment intentions for the December quarter, with over 70% of respondents expecting to recruit. However, a notable increase in redundancy intentions, affecting around a third of employers, raises questions about the tension between recruitment plans and redundancy considerations.

The data suggests recruitment as an ongoing backfilling activity rather than a response to business growth. Higher redundancy intentions and slightly lower wage expectations may serve as indicators of potential economic challenges in 2024. HR professionals are urged to consider strategic measures to control costs, enhance productivity, and retain skilled employees.

New rules for Fixed-Term Contracts in Australia

Fairwork announced new rules for fixed term employment effective from December 6, 2023. Employers engaging employees on such contracts must provide a Fixed Term Contract Information Statement (FTCIS) and adhere to limitations on contract usage. Exceptions apply, and the rules don’t cover casual employees.

Fixed-term contracts are limited to two years, including any extensions or renewals. Renewal options must not exceed two years or renew more than once. The Fair Work Ombudsman has published guidelines on consecutive contract limitations and additional restrictions on using fixed-term contracts. More changes are being introduced in January 2025, which include minimum wage conditions for labour hire workers hosted by regulated workplaces and making wage theft and underpayments a criminal offence.

More to come on this later…