Cost-cutting also driving firms to shift to AI, overseas talent
More than four in 10 employers in Australia are planning to reduce salaries and lay off staff this year as part of their cost-cutting strategies, according to a new report.
Deel's Australian Business Leader Pulse Check research revealed that 70% of Australian businesses will implement cost-cutting measures this year due to market uncertainty.
Part of their measures includes reducing employees' salaries (45%) and laying off staff (41%), according to the research.
Cost-cutting is also a major driver of employers' continued preference for remote work, with 60% citing the arrangement as a key benefit.
In fact, 92% of organisations said remote working remains a strategic priority for them despite recent mandates surrounding hybrid work and office-return policies.
Meanwhile, cost-cutting is also driving organisations to leverage new technologies like artificial intelligence to automate business processes (60%). It is also making other organisations consolidate their technology stack and reduce their tech vendors (59%).
This shift in focus on AI is expected to fuel demand for AI expertise in the next two to three years, according to the report, which found that 86% of organisations are already increasing their hiring budgets to secure AI-skilled talent.
More than half (57%) of business leaders, however, noted that the local skills gap will be a problem in the search for AI talent. Others cited the following issues:
To overcome these talent challenges, Deel's research revealed that 49% of employers are already expanding their talent search to include international markets.
Shannon Karaka, Country Leader at Deel ANZ, said global hiring offers companies the opportunity to access specialised skills that may still be emerging locally.
"The approach is increasing in popularity owing to its ability for the model to help bridge skills gaps, ensuring that Australia can remain competitive on a global scale," Karaka said in a statement.
"With 89% of Australian organisations stating they're open to hiring talent outside of the country, organisations are primed to take advantage of the benefits offered by a globalised market to ensure talent and skills funnels are prioritised, promoted, and invested in for the future, both domestically and internationally."
