Resources, professional services and IT drive economy

Mining demand and soaring terms of trade are driving a two-speed economy, according to a report issued by global recruitment and management services firm Hudson.

The quarterly Hudson Report states that the divide between industries continues to significantly benefit some states and industries over others, despite cautious optimism in employer sentiment overall.

“It is clear the Australian labour market is reflecting broader global uncertainty as well as the already strong differences between sectors resulting from a two-speed economy,” said Mark Steyn, CEO of Hudson Australia/New Zealand. “Those industries connected to resources, professional services or IT remain robust, whereas other industries outside of these areas are weakening.”

The report shows a large divergence between resources, professional services and IT, compared with the rest of the economy. Australia-wide, the resources industry showed the highest level of hiring intentions with sentiment in the sector up 9.5 percentage points year-on-year and more than 30 percentage points above the net national average.

The professional services sector achieved the second highest level of confidence by industry with sentiment at net 50.8%, followed by the IT sector on net 42.7%, indicating that almost half of employers in the sector planned to hire staff by the end of 2011.

All surveyed industries indicated positive employer confidence, but the distance between the industries widened, ranging from net 7% in FMCG to net 58.3% in resources. The results between states was also marked: net 20.4% for Victoria to net 57% in Western Australia.

WA’s buoyant outlook is due to current and planned infrastructure developments, construction/property and engineering, with the sector indicating that 83.8% of employers planned to add to permanent headcount over the coming quarter. This is the highest sentiment ever recorded in the 10 years of the Hudson Employment Expectations Report.

Steyn said the current environment “creates particular challenges for hiring managers” and advocated “a strong employee value proposition that goes beyond a simple focus on salary” to attract talent.

“Today’s uncertain economic environment mean passive job seekers are perhaps less inclined to contemplate a career move. Clearly communicating the benefits of an organisation, to both passive and active job seekers, remains key to ensure a strong talent pipeline for the future,” he remarked.

For further detail on the report, see www.au.hudson.com.

As a project manager, have you been affected by the two-speed economy?