Hiring Trends 2023: How to Attract Top Talent in a Tough Market

by Beam



Australian businesses are still finding it hard to hire staff. If you’re looking for top talent in a tough market, knowing what candidates want can help with recruitment – and retention.

“You just can’t get the staff these days,” goes the old joke. But since Covid, finding good quality employees – or even any employees – has been no laughing matter for Australian businesses.

And the problem hasn’t gone away: 59% of Australian businesses experienced difficulty hiring staff in their most recent recruitment round, according to the July 2023 Recruitment Insights and Outlook Survey from Jobs & Skills Australia.

On the bright side, the proportion of businesses struggling to recruit is falling. Led by the capital cities, the recruitment difficulty rate improved by 16 percentage points compared to July 2022 when it hit record highs.

However, only 51% of employers recruited in July (down from 59% a year previously), with some businesses even giving up trying. Jobs & Skills Australia interviewed 4000 employers between March and July 2023 and discovered that 11% of them “had vacancies they were not actively trying to fill, largely because they felt they would not receive enough applicants or suitable applicants, or because they simply perceived it would be too difficult to recruit”.

Recruitment difficulty: city vs country

Recruitment difficulty: by sector, June 2023 quarter

High hopes?

What hope is there for businesses looking to recruit this financial year?

On the plus side, net overseas migration is expected to be 315,000 in 2023-24, meaning there’ll be a larger pool of talent to choose from.

However, there are still a lot of job vacancies to fill, with 431,600 vacancies in May according to the Australian Bureau of Statistics (ABS). While that number is falling, though only very slowly (down 2% month on month), it’s still 89.3% higher than in February 2020, pre-pandemic.

And with the unemployment rate at 3.6% – only slightly above its lowest level in almost half a century – many businesses could continue to find recruitment a challenge.

Why can’t businesses find staff?

In June 2022, with the recruitment crisis at its highest point, the ABS asked employers what factors were affecting their ability to find suitable staff. Their responses were:

A lack of willing or suitably qualified workers was the main reason businesses were struggling to recruit. But in many cases there was also a gap between what employers were offering, and what candidates were looking for.

Competing interests

Flexibility can be a key issue. Almost all workers (94% in June 2023) would like to work at least partly at home, and 64% would like a hybrid arrangement, according to the Taking the Pulse of the Nation report, from the Melbourne Institute and Roy Morgan.

Employers are increasingly willing to offer this; 60% of workers said their employers permitted hybrid work, up from 49% in April 2021. But it’s still a pain point – workers and employers only agree 37% of the time on the number of hours spent working from home, a figure that’s been constant for the past two years, the report found.

Wages, too, can be an issue on which employers and employees disagree. Of course, this has always been the case, and no doubt always will be, but in a high-inflation environment, with both parties facing rising costs, the disconnect can be greater.

In the March quarter of 2023, seasonally adjusted annual wage growth increased to 3.7%, its highest rate since 2012, according to the ABS. But that will be cold comfort for many workers. With the consumer price index rising as high as 7.8% in December 2022, and still standing at an uncomfortable 6.0% in June 2023, wages have not kept pace with inflation.

According to PwC’s Global Workforce Hopes and Fears Survey 2023, 14% of employees around the world struggle to pay bills every month, and another 42% say once they cover their expenses, they have little or nothing left over (up from 37% in 2022).

Beam can help with retaining and onboarding staff

How to attract talent…

So, is attracting top talent simply a case of offering great pay and flexible conditions? A quick glance at a list of what candidates are looking for in an employer might suggest so. According to the 2023 LinkedIn Future of Recruiting global report, the most important priorities for candidates in Australia and New Zealand were:

  1. 1. Flexibility
  2. 2. Compensation
  3. 3. Career growth
  4. 4. Security
  5. 5. Impactful work
  6. 6. Opportunity to learn new skills

While offering good pay and flexibility is obviously important, the LinkedIn report goes on to explain that recruiters tend to get tunnel vision and think these two factors are the be-all and end-all. A fuller picture of what candidates want is more nuanced than that.

“Instead of fixating on the particulars of your flexible work policy, hone in on the end result – happy and inspired employees – and don’t neglect other aspects of your company culture that foster that happiness,” the report says.

“And rather than only focusing on how people can advance within your organisation, show candidates how they can develop new skills to elevate their career, whether or not they choose to stay at your company.”

Developing a clearly defined employee value proposition (EVP) that tells a candidate what they get when they work for you is increasingly important as businesses fight for top talent, says Hays. It will cover everything from company values and culture to rewards and opportunities.

And once you have a clear message, social media can be a really valuable recruitment tool. You can use social media channels to establish your employer brand, find hidden talent and give them a reason to come to you, and create a hiring journey that convinces candidates to become employees.

… and how to retain talent

Once you’ve attracted staff, how do you keep them? A 2022 Gartner survey found that “culture is king” when it comes to retention, with manager quality, respect and people management being the top three reasons Australian workers leave their employer.

Australian employers should prioritise quality leadership and a positive work culture or risk losing staff in a highly competitive market, Gartner said.

The pandemic showed us that employees crave investment in the human aspects of work, says McKinsey. “Yes, they want pay, benefits, and perks, but more than that they want to feel valued by their organisations and managers. They want meaningful – though not necessarily in-person – interactions, not just transactions.”

Integrating workers into your organisation’s culture from the beginning can be crucial to establishing a positive working relationship. A 2015 Brandon Hall report found organisations offering a strong onboarding process (socialisation and engagement in company culture over the first year) could improve new hire retention by 82% and productivity by more than 70%.

“Companies with weak onboarding programs lose the confidence of their candidates and are more likely to lose these individuals in the first year,” the report said.

Onboarding is evolving, and a robust onboarding process starts on day one. By using automated processes such as Beam’s Super Fund Onboarding (SFO), employers can ensure their new recruits spend less time doing paperwork and more getting to know their new colleagues and being immersed in their new role.

In an environment where recruitment is proving so difficult that businesses are giving up, understanding what candidates want is crucial. As is working out exactly what you can offer them, how you communicate that effectively and deliver on that experience once they’re onboard. Remember, culture is king, and workers want meaningful interactions. Starting on day one.

Give your employees the smoothest of starts with Beam’s SFO

Important information:

Beam is part of the Australian Retirement Trust Group.  Beam is issued by Precision Administration Services Pty Ltd (Precision) (ABN 47 098 977 667, AFSL No. 246 604). Precision is wholly owned by Australian Retirement Trust Pty Ltd (ABN 88 010 720 840, AFSL No. 228 975) (via its custodian) as Trustee for Australian Retirement Trust (ABN 60 905 115 063). Read the PDS and FSG at before considering if our services are appropriate for you.

Back to Knowledge Hub