A number of Australian companies grappling with skills shortages expect their spending on wages and benefits to surge over the next year – threatening business performance.
Nearly half of senior Australian finance executives in large firms expect spending on recruitment and staff retention to grow significantly in 2011, a survey from American Express and CFO Research shows.
Respondents were divided almost equally on whether business performance was placed at greater risk by hiring new staff too quickly, or too slowly.
But skills shortages weigh on nearly everybody's mind, with more than 80% of Australian respondents identifying a lack of access to well-qualified staff as the greatest threat to their performance goals.
In response to this threat, half of finance executives expect their company to spend more on training in the next year. Around 40% are also bracing for increased outlay on bonuses, health benefits and facilitating flexible working arrangements.
Almost a quarter plan to increase their reliance on independent consultants or contractors to overcome any shortage of suitable full-time employees, while a similar percentage intend to turn to employment agencies for more temporary staff.
A plurality of respondents named sales as the most likely job category to require more staff, followed by operations and production, IT, marketing, R&D and customer service.
In each of these categories, no more than 13% of those surveyed expect to decrease headcount over the next 12 months.
Employment expenses threaten to dampen Australian finance executives' generally optimistic outlook for the next financial year – a comfortable majority expect top-line growth for the year, and 17% believe this growth will be substantial.
And 32% expect Australia's economic activity to increase this calendar quarter, with just 15% predicting that this will not occur until after the end of the year.
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