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E.L Index: Executive Employment Trends in Australia – April 2024

18 Apr 2024 | Index Report

The Australian economy is soft and the job market still likely to remain flat.

Infrastructure projects are pushing up the demand for engineers.

Information Technology executives are benefiting from AI-related demand.

Demand for Executive Positions in Australia in April 2024

Demand for Australian executives remains flat after many months of decline,

Mr Grant Montgomery, Managing Director of E.L Consult, a leading executive search firm that has researched and published the E.L. Executive Demand Index for over 30 years, said:

The zero result this month is actually more positive than it has been for months, but it is unlikely that it signals that job demand reached the bottom.

The trend is and has been down over the last few months down and unlikely to recover substantially for some time.

Engineering & Technology Have Positive Performance  

Just two atypical performances by engineering and Technology jobs, have managed to keep overall demand at zero instead of negative.” Mr Montgomery said.

the research results are patchy across the states and territories, with four of them rising slightly and four of them falling.

The high scores in Engineering and Information Technology demand are excellent and probably the best two sectors to have a positive performance as they are both lead indicators for investment.

What is more, the increases in these two sectors have not come as a result of pump primingby the public sector employing more people which often occurs when a recession is looming.

Engineering, is closely related to capital investment and apart from infrastructure development, it is safe to assume that there is some renewed interest in property development with the increasing immigration putting heavy demand on the housing sector.

Increased demand for engineers may also be attributed to the push for renewables and the associated rewiring of the country.

Figures show that there is very little capital investment going into industrial development however, as this sector, which desperately needs to invest to improve productivity, is continuing to die.

Information Technology is also a good sector to rise, and indicates that some planning is underway for a potential boom created by Artificial Intelligence, particularly machine learning, as well as companies seeking to improve the efficiency of their service systems and back office.

“The improvements in these can have a multiplier effect on the rest of the economy over time Engineering in the wider building industry and Information Technology because of the cost savings that can eventuate.

The World Economic Forum predicts that while AI may replace around 85 million jobs by 2025, it will also create approximately 97 million new jobs,” Mr Montgomery said.

In March, among the states the results were split 50/50. New South Wales was the major mover among the states, rising 5 per cent. Other gains were in the Northern Territory, Queensland and the ACT. All other states and territories were lower.

Demand was higher in Engineering and Information Technology, with Engineering demand better across both online and offline job advertisements. Losses across the other sectors were relatively minor, with the Financial index recording the worst result

Call Grant Montgomery on +612 9221 6688 or 0414926688 for further details

March 2024 Statistics

March 2024 National Index

March 2024 National Index: 544

Same period last year (March 2023): 654

Percentage change over last month: zero

National Summary

Demand for Australian executives has been flat after many months of decline. The flat result in the month of March is as likely to be an aberration rather than the start of a new, strongly positive, trend. The result of 0 per cent reflects a couple of positive sectors rather than a positive result across the board.

National Demand for Executives Over Last Seven Years

The three-monthly trend figure has shown some signs of gains after a significant downturn.

State by State Comparison 

In March, among the states the results were split 50/50. New South Wales was the major mover among the states, rising 5 per cent. Other gainers were the Northern Territory, Queensland and the ACT. All other states and territories were lower.

Employment Trends for Executive Groups

Demand was higher in Engineering and Information Technology, with Engineering demand better across both online and offline job advertisements. Losses across the other sectors were relatively minor, with the Financial index recording the worst result.

March 2024 E.L Finance Index

March 2024 E.L Finance Index: 814

Same period last year (March 2023): 987

Percentage change over last month: -5%

Financial positions were down a further 5 per cent over the prior month, making it consecutive falls. The Finance index remains below its medium-term average.

Print public sector ads were actually higher over the month, but web-based advertising was lower in both the government and business sectors.

March 2024 E.L Engineering Index

March 2024 E.L Engineering Index: 284

Same period last year (March 2023):  384

Percentage change over last month: 14%

Engineering recorded a 14 per cent increase compared with the prior month, recovering most of its losses from the prior month.

 

There are signs that the index may be finding a new floor, although it is still significantly lower than its most recent high of March 2023.

Increased demand for engineers may also be attributed to the push for renewables and the associated rewiring of the country.

March 2024 E.L Management Index

March 2024 E.L Management Index: 780

Same period last year (March 2023): 988

Percentage change over last month: -1%

The Management sector fell 1 per cent in March compared with the prior month.

The Management index seems to be holding on to the significant gain made in the beginning of the year.

In March losses across most states and territories were nearly offset by gains in New South Wales, the Northern Territory and the ACT.

March 2024 E.L Information Technology Index

March 2024 E.L Information Technology Index: 256

Same period last year (March 2023): 267 

Percentage change over last month: 13%

Information Technology gained 13 per cent in March, making it the second highest riser among the sectors.

The IT index has now moved to its highest point in 2024, but remains under the level of this time last year.

Web advertising the majority of demand – was higher in both the business and government sectors.

March 2024 E.L Marketing Index

March 2024 E.L Marketing Index: 506 

Same period last year (March 2023): 521

Percentage change over last month: -1%

The Marketing index fell 1 per cent in March compared to the prior month, with web-based advertising falling slightly.

The Index has oscillated around the 500-point mark since 2021, with some saw-tooth tendencies. The interpretation of this is that the industry has not seen the same fall off in demand seen in other sectors over the past year, but it also did not see the gains other sectors made in 2021.

Amid the states and regions, New South Wales and Queensland showed gains but these were offset by losses elsewhere.

About the E.L Index

The E.L Index is a comprehensive monthly analysis of employment trends at executive level. An Australian analysis is produced in Sydney and an Asian analysis in Hong Kong and Singapore.

The E.L Index has shown by two separate University studies to correlate strongly with general economic and business trends. It is featured by most of the major news services and is closely followed by government and central bank analysts.

The E.L Index is actually a combined national index of all executive demand made up of five separate indices; E.L Finance Index, E.L IT Index, E.L Management Index, E.L Marketing Index and the E.L Engineering Index.

The National and specific career group Indexes are shown as relative indexes recording the monthly demand activity for executive positions in the current month against the demand in a historical base period which is normalised to 100. The historical base period used was the average of the last quarter of 1992 which research showed to be the bottom of that downturn.

By averaging to a historical base period the comparison of, say, June 1994 to June 2000 is meaningful, giving a clean, easily understood appreciation of changing investment and economic trends without seasonal obscurity.

The E.L Index utilises data from both print and internet sources and is the only employment index to do so.

The print data is collected from the major employment paper in each state. National papers are not used to avoid “doubling up”. Internet data is not collected off the web sites which can be subject to some error but instead collected through raw data provided by the ISP themselves. Print data has over 15 years of historical data and the internet more than 6 years.

Why Executive Demand is a Primary Lead Indicator?

It is often claimed that unemployment figures and broad-based job vacancy surveys do not give a fair impression of what is occurring in executive ranks. The E.L Index addresses this and has some interesting correlative and predictive qualities. Such as:

  • Employment of management usually precedes the employment of skilled and unskilled workers.

  • Employment of engineering executives precedes major capital investment.

  • The division between various management sectors gives an indication of which sectors of the economy are experiencing growth or decline.

  • Compares month-by-month changes in the public and private sector as well as monitoring government expenditure patterns.

  • Makes regional comparisons after allowing for population differences.

  • It shows a ‘rate of change’ and can therefore be realistically compared to general economic and employment growth, unlike some surveys that report absolute numbers.

  • Core data is collected on an actual expenditure of business and government, not on a respondent’s opinion or confidence level.