Well over a third of Australian businesses are set to make layoffs this year in response to rising inflationary pressures, with workers also unlikely to land a pay rise any time soon, according to a new survey.
HR platform Deel’s new Australian Business Leader Pulse Check: Business Growth, Workforce and Hiring Report, included a survey conducted by YouGov which found that virtually all Australian companies will be taking measures this year to manage increases in costs due to inflation.
For many companies, these measures will include laying off staff.
The survey found that just under 40 per cent of Australian businesses are expecting to make job cuts this year, while 47 per cent will be forgoing any significant pay rises.
Of these respondents, 14 per cent said that pay rises likely won’t be on offer at all, while 33 per cent said pay rises will only be offered to some employees based on their performance.
This will likely lead to more headwinds for businesses, with many workers crying out for a pay rise to help them deal with inflationary costs.
Nearly a third of the human resources professionals surveyed said pressure to increase wages is the top challenge they are currently facing.
In lieu of pay rises, Australian companies are looking to flexible work and international expansions to help retain their staff.
About 40 per cent of those surveyed said they already have a mobility option to allow their staff to work abroad, while 16 per cent are planning to do this or are already developing this.
Three in five respondents also said that their company is planning to expand into a new market in the next two or three years.
“Businesses in Australia are not only aware of the benefits of flexible work and a global perspective on finding and keeping talent, but are clearly embracing it,” said Deel country leader, Australia and New Zealand, Shannon Karaka.
“As talent challenges in the local market mount, a global approach to hiring represents a path forward for Australian businesses looking to buck the local market trends and go for growth.
“The research showcases just how prevalent an international strategy has become among organisations in Australia, and local businesses are fast adopting a recruitment and employee management approach to match.”
These moves may well help to retain staff, with previous research finding that employees with flexible working options are happier, more motivated and more likely to remain in their current role.
The report found that economic challenges are starting to bite in Australian companies. Nearly half of all senior business decision makers surveyed said that rising operating costs are their top challenge, while 92 per cent said they will be taking measures to manage it this year.
In terms of potential government support to assist with these challenges, more than a third of those surveyed said grants to adopt digital tools are crucial, 34 per cent said the government should reduce import taxes and tariffs, while 33 per cent called for a more streamlined migrant worker visa process.
A recent separate survey found that nearly a quarter of Australian workers are ready to leave their job this year, largely due to wanting a higher salary.