2024 Australian Market, Employment & Workforce Updates

• Australian Market Update 
• National & Industry Employment Insights 
• Top CEO Issues 
• Teams are busier than ever but accomplishing less, why? 
• New Super Payday Changes
• Employment Law Updates

AUSTRALIAN BUSINESS LANDSCAPE: WHAT C-SUITE LEADERS NEED TO KNOW FOR  2025

As Australia's economic landscape shifts, business leaders face a crucial period of transformation. With interest rates stabilising and international markets showing signs of recovery, 2025 is shaping up to be a year of opportunity for organisations ready to adapt and grow.

AUSTRALIAN MARKET UPDATE

• Interest rate cycle has shifted with RBA rates in holding pattern
• International interest rate cycle now coming down – US/UK/Europe/New Zealand
• Job volume surprisingly resilient with many organisations kicking off new projects and people initiatives as the new financial year commences
• Organisations very focused on change and transformation, emphasis on people and technology – focus on data and AI
• International backdrop suggests that 2025 could be a strong economic period. 2024 shaping up to be the year of the elections.

NATIONAL & INDUSTRY EMPLOYMENT INSIGHTS:

In trend terms, key statistics in September 2024:

• unemployment rate remained at 4.1%. 
• participation rate increased to 67.2%.
• employment increased to 14,514,300. 
• employment to population ratio remained at 64.4%.
• underemployment rate remained at 6.4%.
• monthly hours worked increased to 1,965 million.

Job ads nationally rose for a third consecutive month, up 0.5% m/m.  Applications per job ad also increased slightly, rising 0.7% m/m*.

After two years of broad decline, Hospitality & Tourism job ads have been growing since June and rose 1.1% in September. 

Increased demand in Trades & Services (1.0%) and Manufacturing, Transport & Logistics (1.3%), though marginal, also supported the overall rise in job ad volumes in September, whereas Information & Communication Technology (-3.7%) and Call Centre & Customer Service (-6.3%) were the largest industries to record a decline m/m. 

Over the past quarter the majority of growth has been in the Consumer Services sector, led by rising demand in Hospitality & Tourism (16% q/q) and Sport & Recreation (11% q/q) and to a lesser extent Retail & Consumer Products (3% q/q) and other industries. 

There was notable increases in candidate demand, measured by applications per job ad, for roles in Engineering (6.9%), Administration & Office Support and Construction (both 6.7%), Mining Resources & Energy (5.7%) and Retail & Consumer Services (5.6%).

Projected employment growth by industry, May 2023 to May 2028, and May 2023 to May 2033.

TOP 5 CEO ISSUES

The CEO Institute published the top 5 issues that their syndicate members raise during their monthly meetings.

1. Economic Challenges and Uncertainty

Many CEOs are grappling with the impacts of a slowing economy, increased costs of labor, utilities, and compliance. Decision making has slowed down, and there is growing caution around investments and expansion due to the economic environment. Companies are managing tight margins while preparing for potential recessionary conditions.

2. Talent Management & Retention

Retaining top talent remains a significant challenge, particularly with increasing employee expectations for higher renumeration and flexible working conditions. CEOs are also facing issues with leadership accountability, with gaps in strategic thinking and commercial awareness at senior levels. Effective coaching and addressing skills gaps are critical to maintaining high-performing teams.

3. Digital Marketing and AI

Digital marketing and AI integration are increasingly becoming central to business strategies. CEOs are leveraging AI to streamline customer interactions and enhance operational efficiency. As companies innovate, they are also investing in digital tools to remain agile and adapt to the shifting demands of the market.

4. Business Growth through Acquisitions

Despite the economic challenges, several CEOs are pursuing growth through acquisitions. Understanding synergies, cost savings, and cross-selling opportunities post-acquisition are key areas of focus. CEOs recognise the need to view their business as an investment and are working to grow its value to remain competitive.

5. Intellectual Property and Product Protection

Businesses focused on innovation and intellectual property are prioritising product design that prevents copying and theft. This is especially important in sectors like engineering where the protection of intellectual assets is directly linked to competitive advantage. CEOs are exploring strategies ot safeguard their IP while ensuring staff retention to support this effort.

TEAMS ARE BUSIER THAN EVER BUT ACCOMPLISHING LESS, WHY?

The number one thing teams and executives need to hear right now is the idea that teams are busier than ever but accomplishing less. Research found that 65% of knowledge workers say that it’s more important to respond to notifications than it is to make progress on their top priorities. And similarly, 93% of Fortune 500 executives said their teams could accomplish the same amount in half the time if they could collaborate more effectively. That means we are in a how-to-work crisis, and teams need new practices and comfort with new types of technologies like AI in order to make more progress on what matters.

Organisations need goal-setting habits and norms that make it clear to teams, as well as their collaborators, about what work matters right now. And similarly, individuals need to develop daily practices to understand what matters today, and how do I design my day to achieve that?

AI is definitely the topic to be unpacking right now, there’s two things that teams need to understand about AI. First is that it’s about moving faster through tasks that could otherwise be automated, yes. But it’s also about being more creative. So teams should absolutely be using AI to find, manage, digest, share information.

Teams need to stop doing individually saved files or using document titles to try to manage things and instead have a conversation with their AI assistant about what they’re looking for and how to use that information. But also, teams need to use it to be creative. So if you are kicking off a new project or building a new strategy, and your favourite sparring partner is on a call or otherwise unavailable, open up a conversation with AI.

This can lead to real-time feedback, sharing of ideas, and really creating a true conversation. Because what’s really special about this moment is that, for the first time, technology speaks our language. And that is a huge unlock.

NEW SUPER PAYDAY CHANGES

In the 2023-24 Budget, the Government announced a reform to align employers’ payment of Superannuation Guarantee (SG) contributions with salary and wages, instead of the current quarterly requirement. This will take effect from 1 July 2026.

This will strengthen Australia’s superannuation system and help deliver a more dignified retirement to more Australian workers by tackling unpaid superannuation. The non-payment and underpayment of superannuation by employers risks the retirement income of millions of Australians. Non-payment and underpayment of superannuation is equivalent to wage theft and has significant impacts on retirement outcomes.

Around 8.9 million employees will benefit from higher retirement savings from receiving their superannuation contributions earlier and more frequently throughout their working life. These reforms will deter superannuation theft and enable the ATO to take quick action to rectify instances of unpaid superannuation.

What Does This Mean for Employers?

Employers will need to ensure compliance with several new reporting requirements under Single Touch Payroll (STP). You must report both the Ordinary Time Earnings (OTE) and the total Super liability for each employee, facilitating accurate superannuation assessment and compliance.

Key Changes Include:

• Reduced Allocation Time:
  The deadline for superannuation funds to allocate or return contributions will decrease from 20 business days to just 3 days.
• Simplified Fund Choice:
  Revised rules will make it easier for employees to nominate their super fund when starting a new job.

Exceptions to Note:

• Contributions have a deferred due date during the first two weeks of employment.
• Small and irregular payments that occur outside the regular pay cycle are not considered a “payday” until the next scheduled payment.

Why Are These Changes Happening?

• Enhanced Monitoring:
  Payday Super aims to improve the superannuation system, providing consistency and ease of tracking for both employers and employees.
• Increased Financial Security:
  More frequent contributions will enable employees to monitor their retirement savings effectively, enhancing their financial security.
• Streamlined Processes for Businesses:
  Employers will benefit from clearer payroll processes and reduced long-term liabilities.
• Tackling Unpaid Superannuation:
  These changes aim to enforce compliance with penalties for non-payment and underpayment, benefitting 8.9 million employees with higher retirement savings.
• Proactive Interventions:
  Employers can resolve issues early, allowing for prompt disclosures of any failures to pay Super on time, which can reduce penalties.

What If You're Not Compliant?

The updated Superannuation Guarantee charge imposes penalties and interest on late or incomplete payments, with escalating consequences for repeated non-compliance. Employees are ensured compensation for any delays, incentivising employers to settle outstanding superannuation promptly.

EMPLOYMENT LAW UPDATES

We can now deal with disputes about unfair contracts for independent contractors. 

We can cancel (set aside) or change (amend or vary) unfair terms that would relate to workplace relations matters if the independent contractor were an employee. 

Read about: 

• Independent contractor disputes about unfair contract terms including new laws about:
• unfair contract terms for independent contractors
• unfair terms in services contracts. 

There is a new definition of casual employee, and we can now deal with disputes about the right of casual employees to become permanent (in some circumstances). 

Read about: 

• Casual to permanent status including new laws about:
•  disputes relating to the right of casuals to become permanent employees
• the definition of a casual employee. 

We can now deal with disputes about the employee right to disconnect. 

Read about:

• Right to disconnect disputesincludes new laws about:
•  how we deal with disputes about the right to disconnect, including: 
• stop orders, and 
• changes to general protections. 

Building on existing reporting requirements, companies with over 100 employees must now publish their gender pay gap data publicly. This increased transparency aims to accelerate progress towards pay equity and may impact employer branding and recruitment.

As these changes take effect, it's crucial for executives to:

1. Review and update company policies and employment contracts
2. Invest in training for managers on new compliance requirements
3. Conduct thorough audits of payroll and workforce management systems
4. Engage legal counsel to navigate complex cases

By proactively addressing these updates, Australian business leaders can mitigate risks, foster positive workplace cultures, and position their organisations for success in an evolving regulatory environment.

Organisations who fail to comply with these reporting requirements face the risk of being publicly named in WGEA’s Non-compliant organisations list, which will name those employers who have not met their obligations or WGEA’s minimum standards to show commitment to gender equality.

Flexible Work Arrangements

The pandemic-driven shift to remote work has led to permanent changes in legislation. Employers are now required to have a formal policy on flexible work arrangements and must provide valid business reasons for denying such requests. This change aims to promote work-life balance and inclusivity, particularly benefiting working parents and caregivers.

Casual Employment Reforms

Building on the 2021 reforms, casual employment definitions have been further refined. Employers must offer permanent positions to casual employees who have worked regular patterns for 12 months, unless there are reasonable grounds not to do so. This change significantly impacts workforce planning and budgeting.

There have been multiple changes to casual employment laws.

These include to:

• how casual work is defined
• the pathway to full-time or part-time employment
• employee and employer responsibilities.

A new definition of ‘casual employee’ will be introduced to the Fair Work Act. Under this definition, a person is a casual employee if, when they start employment:

• the employment relationship has no firm advance commitment to ongoing work, taking into account a number of factors, and
• they’re entitled to a casual loading or specific casual pay rate under an award, registered agreement, or employment contract.

Casuals employed before 26 August 2024

Employees classified as casual who were with their employer before 26 August 2024 will stay casual under the new definition unless they move to permanent employment. 

For casuals employed from 26 August 2024, the new casual employee definition will apply.

Wage Theft Criminalisation

Following Victoria's lead, wage theft has been criminalised nationally. Executives need to ensure robust payroll systems and regular audits to avoid severe penalties, including potential imprisonment for deliberate underpayment.

With the rise of digital workforce management tools, new regulations have been introduced to protect employee data. Businesses must now obtain explicit consent for collecting and using certain types of employee information, particularly in relation to health data and performance metrics.

CONCLUSION

For C-suite leaders, 2025 presents a unique opportunity to position their organisations for success. The combination of stabilising economic conditions, technological advancement, and regulatory changes creates an environment where forward-thinking companies can thrive.

The key to success will lie in balancing innovation with compliance, while maintaining a strong focus on talent management and operational efficiency. Organisations that can effectively navigate these changes while leveraging new technologies and maintaining strong workforce relations will be best positioned to capitalise on the opportunities ahead.

RESEARCH

https://www.abs.gov.au/statistics/labour/employment-and-unemployment/labour-force-australia/latest-release
https://www.jobsandskills.gov.au/data/employment-projections
https://treasury.gov.au/sites/default/files/2024-09/p2024-581438-payday-super-factsheet.pdf
https://performhr.com.au/are-you-ready-for-the-new-super-payday-changes/
https://treasury.gov.au/sites/default/files/2024-09/p2024-581438-payday-super-factsheet.pdf
https://hbr.org/sponsored/2024/10/video-quick-take-atlassians-annie-dean-on-collaboration-trends-ai-and-new-ways-of-working
https://www.mcw.com.au/gender-pay-gap-reporting-what-does-it-mean-and-what-should-you-be-doing/
https://treasury.gov.au/sites/default/files/2024-09/p2024-581438-payday-super-factsheet.pdf
https://www.seek.com.au/about/news/article/seek-employment-report-septemberTOP 5 CEO ISSUES