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Employers urged to think before cutting
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The warning comes in response to the Finsia/Roy Morgan Industry Opinion Poll of Finsia members* – a survey which highlights employment challenges facing Australia’s finance sector in the wake of the global financial crisis.
The research uncovered that whilst a large majority of poll respondents (93%) agreed that the recruitment market in the Australian finance sector has significantly declined since September 2008 and that graduate intake levels will be scaled back in 2009 (84%), many largely believe that the talent shortage Australia has experienced in recent years has not disappeared (76%) and will be back in greater force than before (67%).
Ninety–four per cent also believed that staff who are unsatisfied in their current roles are ‘riding out‘ the downturn instead of seeking other employment opportunities, and 66% of respondents agreed there has been a greater focus on fitting people to roles rather than attracting the right ‘talent‘.
While layoffs may be the most obvious cost–cutting measure, Dr Martin Fahy, CEO of Finsia, urges that companies who want to avoid a backlash – once the market snaps back into shape – would be wise to consider other options first.
“Just six months ago Australia was dealing with a rising talent shortage. Today, the pressure to cut labour costs is immense. But open–minded organisations will seek to exhaust other alternatives, which promise greater outcomes in the long–term.”
According to Jason Hemens, corporate communications manager at Michael Page International, there are several other strategies companies under cost–cutting pressure can try that don’t involve losing valuable talent.
“Employers should look at all the options available to them before letting skilled staff go. These options include reducing performance bonuses, cutting back on discretionary spend, office rental costs and training budgets. Redeployment is another strategy worth serious consideration,” he said.
“In trying times it’s sometimes difficult to think long term, but when it comes to human capital you need to. The companies who manage to retain the most skilled and productive workforce are the ones that will reap the benefits of a market upturn.”
Fahy added that companies should also be looking to the future, as this will also provide some direction and focus for the business and its employees.
“The focus now must be on rebuilding public confidence in our industry. Australia’s long–term ambition of becoming a regional financial hub should remain top of mind, as we refocus the regulatory issues surrounding the crisis. Australia’s financial services industry is well regarded internationally and we can turn this into a key competitive strength. Those who achieve outcomes through multiple routes will recognise that Australia’s human capital restraints have not disappeared. Rather, this period merely provides us with breathing space,” he said
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