New Employment Hero data shows casual hiring at its weakest in 13 months. CEO Ben Thompson explains what’s driving the slowdown.
Australia’s small and medium business labour market showed further signs of cooling in July, with casual employment falling 0.7% month-on-month, the weakest monthly result for casual workers in 13 months.
The latest Employment Hero Jobs Report also found SMB headcount contracted slightly, down 0.1% month-on-month, marking the weakest monthly change across the reporting period. The report draws on first-party payroll and employment data from more than 23,000 businesses and 1.7 million employees across Australia.
The slowdown wasn’t uniform. South Australia bucked the national trend, recording the strongest employment growth in the country at 0.7% month-on-month, while New South Wales fell into negative growth at negative 0.4%.
Wage growth varied just as widely by state. Queensland recorded the strongest monthly wage growth nationally at 1.8% month-on-month, with solid annual growth of 4.5%. Average hourly wages there now sit at $46.80, closing in on New South Wales, where hourly wages average $47.20 despite slower annual growth of 3.8%.
Tasmania posted the strongest annual wage growth in the country at 5.5%, even though it still has the nation’s lowest average hourly wage at $42.90. Nationally, wages rose 1.2% month-on-month in July, a second straight month of growth, though annual wage growth eased to 4.2%, the lowest recorded across the 13-month reporting period.
Employment Hero CEO Ben Thompson said the July data reflects businesses taking a more cautious approach to hiring rather than losing confidence altogether.
“When businesses pull back on casual hiring, it’s a clear sign they’re being forced to scrutinise every dollar and ask harder questions about how they can stretch their resources further,” Thompson said.
“It’s been a hard year for Australian businesses, but we’re not seeing them lose their ambition. Our quarterly pulse check of business leaders found more than half remain positive about the next six months. The challenge is turning that confidence into capacity. I hear from businesses every day that are under pressure to lift productivity, reduce staff burnout and be more selective about where they add headcount,” he said.
“That’s creating the slower hiring market we’re seeing, but it doesn’t necessarily mean a weaker one. We’re standing on the edge of a once in a generation opportunity, where AI and technology can fundamentally change how productive Australian businesses can be. The question is whether we make it easier for entrepreneurs to seize that opportunity, or keep burying them in complexity,” Thompson said.
While the broader market cooled, workers aged 18 to 24 continued to lead the country on both employment and wage growth for a second consecutive month. Headcount for this age group rose 0.9% month-on-month, and their earnings grew 1.7% month-on-month and 8.0% year-on-year, both the strongest of any age cohort.
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Yajush writes for Dynamic Business and previously covered business news at Reuters.
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