In amongst low unemployment and an ongoing ‘War for Talent’ in specific industries across Australia, the election of a new LNP government in Queensland has altered the job market paradigm in Queensland.
Elected on a general premise to increase value for money to Queensland residents for the state services they receive, the Newman government has made election promises on a range of issues including freezing car registration fees, reducing annual water and electricity bills and offering discounts for commuters on public transport. In order to achieve this, the new LNP government has already targeted significant cost savings within the State Government, with the reduction of public servants in non-front line services being a key pillar of their approach.
In May, the Queensland Premier announced plans to eliminate up to 30,000 temporary positions, among them an unspecified number of IT roles, from the state’s 250,000 strong payroll, in a bid to rein in state spending (http://m.smh.com.au/it-pro/government-it/government–it-contractors-in-limbo-20120618-20jev.html).
The outcome of this policy is about to hit the Queensland job market, with hundreds of highly qualified staff currently employed on ‘temporary’ government or ‘agency’ contracts being terminated the 29th June. As mentioned in the above article, this is having a particularly profound effect on the IT job market, with skills such as Application and Database Developers, Project Managers and Business Analysts – which have traditionally been in demand in Queensland and elsewhere – about to become readily available.
Already TMS is seeing incidental evidence of the private sector taking advantage of this sudden increase in availability for IT and other skills, with a number of organisations hiring key staff to fill gaps in these fields, although demand is unlikely to match supply in the short term. Equally, our recruitment team are seeing an increase in job applications and a rationalisation of wage demands by those coming out of the public sector, which is likely to have an impact on wage inflation in the short term. A final outcome of this development seems to be a push towards permanent employment from the candidate base, who appear more motivated by stability in this time of uncertainty in the Queensland job market.
All of which raises the question, is it now a buyer’s market for quality labour in Queensland, and what does this mean to employers?
It is important when answering these questions to consider the scope of the current cuts to the Queensland Government labour force. All indications are that only ‘non front-line’ services are affected, and as such the influx of quality resources on the market is likely to be limited to mainly corporate functions such as IT, Finance, HR and administration. Given the major skills shortage in the Queensland market currently is in the engineering space, we do not anticipate a major spike in private sector employment as a result of this development. However, there may be some opportunistic hiring of staff by the private sector in certain key roles within their corporate services functions.
For employers, the good news is that some (but not all) of the skills they have had difficulty securing for their businesses may be more prevalent and affordable than in recent times, although this is unlikely to be more than a short term phenomenon. They may also have slightly more success in attracting skilled workers in to permanent employment, given the desire for stability in the candidate market place in Queensland at present. Some staff retention issues may also be eased slightly in this climate, although this will be limited to specific disciplines rather than across the board.
One further thought for consideration is the potential for further cuts to the permanent government workforce hinted at by the Premier’s government in recent weeks (http://www.theaustralian.com.au/national-affairs/state-politics/newman-braces-for-job-cuts-backlash/story-e6frgczx-1226401655339). There is already anecdotal evidence of a lowering in morale within the public service entities in Queensland as a result of this speculation, which could lead to higher than average attrition rates within certain sectors of the government workforce. In addition, if these cuts do eventuate, they are likely to further skew the balance of power in the job market in Queensland in favour of employers, although we anticipate this would happen over a longer period and therefore not have as pronounced an effect as the initial cuts.